Ball State faculty member issues study on tax districts

Few people realize how many hands touch their tax dollars.

One such example is the concept of special districts, which can affect anybody paying taxes to a particular county, according to Ball State director of research Dagney Faulk.

A study recently completed by Faulk answered some questions about whether or not special districting was beneficial to the state.

"It just depends on how the district was set up in each individual county, but a portion of the residents pay property taxes to the district," Faulk said. "It's like this layering of the local government where a person can live in a county, in a city, in a school district, and they can live in a variety of special districts and pay taxes to all of those different levels of local government."

Faulk and Larita Killian, assistant professor in the division of business at IUPU Columbus, worked together to complete the study.

"We were looking at the growth of special districts in Indiana and the surrounding states, and we found that starting in 1952 to 2007, there has been a lot of growth in the U.S. as a whole but also in Indiana," Faulk said. "For example the number increased from 293 in 1952 to 1,272 special districts in 2007."

Special districts can be beneficial by providing public services to communities, but the design itself can allow for a larger debt than normal governments.

Faulk and Killian found that although there are issues surrounding the advantages of special districts compared to normal governments, the lack of public knowledge on the issue is a real obstacle and they hope students will learn from this study.

"Many students, I hope, will become future citizens and future voters of Indiana, and I hope students will consider the importance for efficiency and transparency and accountability ... in government," Killian said.

Killian said she feels the study has been skewed in its receptions.

"We're not saying special districts are negative or bad in any way what so ever and in fact, the title that some people are giving this, our study, does not say eliminate special districts," Killian said. "What it says is there's important issues related to special districts that we should be considering and thinking about. So it doesn't say yes, more or no, fewer special districts."

Killian wants those who read the study to understand that the message she is trying to voice is special districts have benefits and negatives. Faulk said he hopes this study creates a new awareness for those who read it.

"I guess [I want] just an awareness that special districts exist and as students graduate and take jobs and become tax payers, that they're paying taxes in a variety of local government jurisdictions, including special districts," he said.

Killian said some special districts are created because they are allowed to take on more debt than normal governments.

"What is true is that sometimes, special districts are created, not always because they're all very different, for the purpose of circumventing debt limits on general governments," Killian said. "So for instance, the city and the county may have debt limits, constitutional or due to state laws, they're only allowed to take on so much debt."

Killian said she hopes the study will create a conversation and get people thinking about how special districts affect them as citizens.

"It's important for readers to know, we're not saying special districts are always good or always bad; it's much more complex than that," Killian said. "The important thing is to understand the impact of special districts and then to think about how do we deal with these issues." 


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