The Town of Munster will be staring down some hard choices if Senate Bill 1 and other bills aiming to cut property taxes make it past the finish line this legislative session, its councilors warned.
Amid a discussion about renewing its contract with Indiana law firm Barnes & Thornberg during Monday night’s Town Councilman Chuck Gardiner, R-3, asked whether the council has gotten a feel for the issues for which the firm will lobby on the town’s behalf. With those bills wending their way through, the town is poised to lose money for which it can’t afford, he said.
“My concern is, there’s certainly a lot of discussion at the State level about tax revenue, coming to cities and towns,” Gardiner said. “I know that the Association of Indiana Municipalities (AIM) is really heavily talking about replacing but not erasing that money.”
Senate Bill 1 would would change the homestead standard deduction amount to 60% of the homestead’s assessed value if the value is more than $125,000, or $48,000 plus 60% of the remaining assessed value if the homestead has an assessed value of $125,000 or less. In addition, the bill states a controlled project or a school tax levy referendum can be held only at a general election in an even-numbered year.
Council President George Shinkan, R-1, said they’ve anticipated the legislative bills were coming, so they have talked about the ways in which the town would replace any revenues lost to these property-tax reductions. They’re also working with someone at the federal level through Governor Mike Braun’s office about getting appropriations, he said.
“Again … I’m just concerned about the state Senate Bill, which is going to truly affect us,” Gardiner said. “I remember what happened with the school, and now the school goes out every seven years for referendum.
“We are doing a good job of paying our employees. We’re adding employees. We’re adding services. But I’m also concerned that, you know, basic government services might have to be cut if we don’t have a way to replace those revenues that currently we’re receiving with the property tax.”
The Senate Bill 1 fiscal note shows that school corporations are projected to lose around $536 million in revenue in 2026, between $626 million to $641 million in 2027, and between $708 million and $737 million in 2028.
Shinkan and Councilman Dave Nellans, R-4, agreed and said the town would have to start looking at a food and beverage tax, gas tax, hotel tax and even an increased wheel tax.
“We would have to find if it were to pass as it sits right now, we would have to find other revenue sources,” Shinkan said.
“Or it means cutting service, and just to that purpose, you know, in the last year, we probably added what, 20 employees to the town. So again, it is something that we have to be very careful about,” Gardiner said.
Munster Police officers in December received a second — and in many cases a third — raise for while the rest of the town’s employees got their first after the town approved a 3% raise for all non-sworn employees, the Post-Tribune previously reported. The council also approved purchasing six new squad cars — at an initial cost of $291,483.50, to be paid out of the town’s TIF district — to “accommodate the six additional officers” the town sought to hire.
The Council previously approved the purchase of 20 new police vehicles, also paid out of the TIF.
Staff reporter Alexandra Kukulka contributed.
Michelle L. Quinn is a freelance reporter for the Post-Tribune.
