$3M Projected Shortfall May Mean New County Tax
July 28, 2016 at 4:25 p.m.
By Jordan Fouts-
Kosciusko County Council discussed Thursday the urgent need to find new revenue sources in light of a report on the financial shape of the county from Umbaugh and Associates. Without any action, Umbaugh projects a budget shortage of $3 million after two years.
Umbaugh will present its full report during a public meeting May 22 at 7 p.m. in the county courthouse.
The high tide of that red ink, $2 million, will hit the county highway department – just as Superintendent Scott Tilden predicted when he took the job four years ago, County Commissioner Ron Truex observed during the meeting. The county has been supplementing highway expenses from Economic Development Income Tax funds, which Truex cautioned are in danger of drying up if the highway department isn’t made self-sustaining.
“When (Tilden) came in, he said, ‘Holy cow guys, we got a problem,’” Truex said. “We didn’t suddenly realize we’re short on money – it’s been documented in the past four years.”
The county has not taken any major action on taxes since EDIT was established in early 2000 to support expansion of the county jail, he said. The fund for capital projects was set at 0.3 percent and at that time the County Option Income Tax was raised from 0.6 to 0.7 percent, together meeting the set limit of 1 percent.
Council President Bob Sanders agreed with the pressing need to find new sources of revenue.
“At this point, the Band-Aids® are getting smaller and the wound is getting bigger,” he remarked. “We’re being put into a spot where we have to come up with some kind of decision, or else tear the roads up and go back to the days of mud and dirt.”
He said one viable source of revenue may be a wheel tax, a payment collected during vehicle registration that many surrounding counties have adopted. The money, limited to road use, must be divided among all cities and towns in the county, he said, something the county would have to factor in when considering its own needs.
Council would need to enact a wheel tax by June 30 to begin collecting in July and start receiving the money next year, he said. Any later and the county wouldn’t begin receiving the money until 2016.
Councilman Jim Moyer also suggested that county departments look into enacting or increasing fees for certain services, which in some cases could generate tens of thousands of extra dollars. He added that the county has done well to hold off on raising taxes for so long.
Councilman Doug Heinisch said costs should be cut at the same time new revenue is created, and that council should take a hard look at what the departments are spending. Department heads should also report on their service level and what services would look like under further cuts, he added.
But Sanders and Truex both indicated that departments have already been trimmed to the limit and that further cuts would hurt services that residents rely on. Asking department heads to get rid of more people wouldn’t help the local economy either, Sanders said.
Sheriff Rocky Goshert, Auditor Marsha McSherry and Treasurer Sue Ann Mitchell all reported that their departments are already operating on minimal staffing and that further cuts would not only hurt services, but also start cutting into their ability to collect revenue.
“In the courthouse, listening to the managers – we’re trimmed down pretty darn thin. Just for the record,” Truex remarked.
Also Thursday, council approved an additional appropriation of $132,591.83 from the Louis Dreyfus Tax Increment Finance District for work on CR 700S near Claypool; and passed a tax abatement schedule which sets the reduction percentage over the 10-year term of an abatement, as well as giving the county the ability to change an abatement if a business isn’t meeting the terms of the agreement.
And council approved the appointment of John McDaniel to the Lakeland Regional Sewer District board, to replace resigning member R.D. Jones. McDaniel is a resident of the sewer district who operates a commercial business and has attended meetings as an audience member for several years, board President Jim Haney told council.[[In-content Ad]]
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Kosciusko County Council discussed Thursday the urgent need to find new revenue sources in light of a report on the financial shape of the county from Umbaugh and Associates. Without any action, Umbaugh projects a budget shortage of $3 million after two years.
Umbaugh will present its full report during a public meeting May 22 at 7 p.m. in the county courthouse.
The high tide of that red ink, $2 million, will hit the county highway department – just as Superintendent Scott Tilden predicted when he took the job four years ago, County Commissioner Ron Truex observed during the meeting. The county has been supplementing highway expenses from Economic Development Income Tax funds, which Truex cautioned are in danger of drying up if the highway department isn’t made self-sustaining.
“When (Tilden) came in, he said, ‘Holy cow guys, we got a problem,’” Truex said. “We didn’t suddenly realize we’re short on money – it’s been documented in the past four years.”
The county has not taken any major action on taxes since EDIT was established in early 2000 to support expansion of the county jail, he said. The fund for capital projects was set at 0.3 percent and at that time the County Option Income Tax was raised from 0.6 to 0.7 percent, together meeting the set limit of 1 percent.
Council President Bob Sanders agreed with the pressing need to find new sources of revenue.
“At this point, the Band-Aids® are getting smaller and the wound is getting bigger,” he remarked. “We’re being put into a spot where we have to come up with some kind of decision, or else tear the roads up and go back to the days of mud and dirt.”
He said one viable source of revenue may be a wheel tax, a payment collected during vehicle registration that many surrounding counties have adopted. The money, limited to road use, must be divided among all cities and towns in the county, he said, something the county would have to factor in when considering its own needs.
Council would need to enact a wheel tax by June 30 to begin collecting in July and start receiving the money next year, he said. Any later and the county wouldn’t begin receiving the money until 2016.
Councilman Jim Moyer also suggested that county departments look into enacting or increasing fees for certain services, which in some cases could generate tens of thousands of extra dollars. He added that the county has done well to hold off on raising taxes for so long.
Councilman Doug Heinisch said costs should be cut at the same time new revenue is created, and that council should take a hard look at what the departments are spending. Department heads should also report on their service level and what services would look like under further cuts, he added.
But Sanders and Truex both indicated that departments have already been trimmed to the limit and that further cuts would hurt services that residents rely on. Asking department heads to get rid of more people wouldn’t help the local economy either, Sanders said.
Sheriff Rocky Goshert, Auditor Marsha McSherry and Treasurer Sue Ann Mitchell all reported that their departments are already operating on minimal staffing and that further cuts would not only hurt services, but also start cutting into their ability to collect revenue.
“In the courthouse, listening to the managers – we’re trimmed down pretty darn thin. Just for the record,” Truex remarked.
Also Thursday, council approved an additional appropriation of $132,591.83 from the Louis Dreyfus Tax Increment Finance District for work on CR 700S near Claypool; and passed a tax abatement schedule which sets the reduction percentage over the 10-year term of an abatement, as well as giving the county the ability to change an abatement if a business isn’t meeting the terms of the agreement.
And council approved the appointment of John McDaniel to the Lakeland Regional Sewer District board, to replace resigning member R.D. Jones. McDaniel is a resident of the sewer district who operates a commercial business and has attended meetings as an audience member for several years, board President Jim Haney told council.[[In-content Ad]]
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