Town of Fishers Neighborhood Meetings—What they are saying

So far, the Town of Fishers (TOF) has met with (or tried to met with) about 14 Geist Area neighborhoods—one or more members of the GUO has been at each meeting. Some of the meetings have been well attended—especially if the neighborhood is on septic—while others were not attended by anyone at all (other than the GUO).

The net of TOF’s presentation is an “inducement” to encourage homeowners to be voluntarily annexed. The inducement is:

1. The annexation would not be effective until 12/31/08.
2. Homeowners would not begin paying increased property taxes until 2010, based on the 2009 assessment (which is the law).
3. The Town would abate a portion of the higher property taxes over a three year period—the abatement percentages are defined by state law:
a. 75% discount year 1 (2010)
b. 50% discount year 2 (2011)
c. 25% discount year 3 (2012)
d. Full fare beginning year 4 (2013)
4. For those on well and septic that want water/sewer connections, the deal basically includes 30 year interest free financing of the cost of doing so, along with some other benefits.

They are saying that our property taxes would go up 16.45%. They dispute our estimate of a 20% – 22% increase, but those numbers were obtained from TOF back in November 2005 when several Geist property owners asked the Town what their individual tax increase would be—so, these are their numbers. Keep in mind also that originally TOF claimed our taxes would only go up 14.68%.

Regardless, using TOF figures handed out at their presentations, if your house is valued at $500,000 then your tax increase will be $1,010 per year—a jump from $6,139 to $7,149—year after year (assuming you get all of the homestead and tax replacement credits available). For a million dollar home, taxes go up $2,127 per year: that’s over $21,000 in ten years excluding any tax rate increases by Fishers, Hamilton County, Fall Creek Township, and HSE.

With the exception of providing interest free financing for water/sewer connections for those currently on septic, thus far TOF has offered nothing else in exchange for higher taxes.

Voluntary vs. Involuntary and the Numbers

It is our understanding that the Town plans to mail their proposal for “voluntary” annexation to all Geist Area homeowners early in September. We believe that the proposal will be a recap of the tax abatement offer (outlined above), and perhaps one or two offerings such as a new firehouse. The mailing may or may not contain a pre-annexation agreement for you to consider signing.

If it does contain a pre-annexation agreement and if it is patterned after the pre-annexation agreements offered to those considering water/sewer hookups, it is not an agreement to be voluntarily annexed, but rather an agreement to not remonstrate against annexation.

What does that mean? Under law, to be voluntarily annexed 51% of the property owners of the area wishing to be annexed must petition the Town Council requesting annexation. That means a majority of the people want to be annexed.

We don’t think they will seek voluntary annexation as outlined under the law, but rather re-introduce the forced annexation ordinances, and if they have enough homeowners who have signed “pre-annexation” agreements then the forced annexation cannot be fought.

A supermajority is needed to legally fight a forced annexation: 65% of the property owners must sign a petition against the annexation. But, if TOF can get 36% of Geist property owners to sign a pre-annexation agreement, then it will not be possible for the rest to remonstrate as the 65% threshold cannot be met. Pretty good strategy on their part, wouldn’t you say?

So what’s the risk? TOF would like you to think that annexation is inevitable and you are better off taking their tax abatement deal now than risk paying 100% of the additional taxes once the forced annexation goes through.

But, check it out: using TOF numbers they say that if your home is worth $500,000 you will save $1,514 in reduced taxes over the first three years of annexation. After that (beginning in 2013) you will pay an additional $1,010 each year—given that the average length of time one keeps the same home is 7 years, that’s $7,070.

If we fight the forced annexation—our attorney has said that if we get the 65% we will get to court and our case against forced annexation is highly defensible—it could take several years before the case is resolved and you could save more money by fighting annexation than by taking the deal.

[Keep in mind that property taxes are paid in arrears, which is why if the “voluntary” annexation is effective 12/31/08, property taxes would be assessed in 2009 and become payable in 2010.]

If we fight the annexation, assuming it would take three years to pass the ordinances, file the remonstration, and go through a court hearing (including the inevitable appeal), the economics would be:

Again, assuming a three year process: (1) if “voluntary” annexation goes through you would pay an additional $2524 in property taxes between now and 2013 (on a $500,000 home, using TOF figures); (2) if we fight annexation a lose, you would still save $504 over the pre-annexation offer; and, (3) fighting annexation and winning—a likely scenario—you would save $2524, plus $1010 per year each year thereafter.

Under the law, even if the Town Council introduces the forced annexation ordinances at their September 17^th meeting, they still have to hold a public hearing no earlier than 60 days after that and cannot adopt the ordinances for another 30 days after the public hearing. This would take the timeline to about December 17^th just to pass the ordinances.

Then we have 90 days to collect petitions and file our remonstrance; that takes the timeline to about March 17, 2008. Then a hearing has to be scheduled and held, the ruling made, and the inevitable appeal by the Town to occur. This could easily push the timeline out to sometime in 2010 before resolution. The above table conservatively assumes, if TOF prevails, annexation at the end of 2010 and tax payments beginning 2012 for taxes assessed in 2011. Each year added on to this would save you another $1010.

If Geist prevails—and there is every reason to believe that we would—then there are no new taxes as TOF cannot try to annex us again for 4 years.

Moreover, the state Senate has formed a study committee to review state annexation laws. Fighting annexation now gives the legislature time to perhaps fix current annexation law and, perhaps, end all of this silliness once and for all.

Lastly, don’t forget that the proposed tax increase by Fishers of 16.45% may or may not hold up long term—if it’s higher, your savings in fighting forced annexation will be higher, as well; this is on top of the huge tax increases we just got hit with; likely, as Fishers annexes more territory the Township will have to increase taxes to make up for the short-fall; and, HSE may need to raise taxes as well as more and more people move into Fishers.