A proposal for an exemption ordinance eliminating the taxation of mobile homes assessed as personal property was brought before the Kosciusko County Council Thursday morning at their informational meeting.

No decision was made by the council on the ordinance suggestion as presented by County Treasurer Michelle Puckett and Assessor Gail Chapman. The council’s regular meeting is at 6 p.m. April 11.
Puckett explained, “SEA 183, the governor signed that into law and that will be effective July 1 of this year. And what that in essence is doing is that it gives each county in the state of Indiana the option to no longer assess personal property mobile homes. It’s not mandatory, but it is an option that they have given us.”
She said the conversation on the issue has been going on for over 20 years “on mobile homes, as far as the value that they do bring into the counties compared to the cost that it takes for us to facilitate that.”
After Chapman and Puckett discussed the option “quite a bit,” Puckett said both of them were in favor of bringing the ordinance to the council for consideration.
“As mobile homes are processed throughout the county, they start in the assessor’s office. The auditor’s office works with mobile homes, and then it comes to the treasurer. When people do not pay those, since it’s not real estate where their property would go to tax sale, they’re certified court, so the clerk has a part to play in it, the courts have a part to play in it, and finally they would be certified for collection with a collection agency,” she stated.
Currently, there are 8,498 judgments that are certified court and there are almost 18,000 judgments sitting for collection for mobile homes.
“So even though we do put all this work and effort into assessing and collecting, right now about 70% of them are paying. We have a little over 3,200 mobile homes that are active that I’ll be sending out bills,” Puckett stated.
With no real way to enforce the taxation on mobile homes since they are personal property, she said, “I think that’s why this got a lot of traction with the state this year.”
A number of years ago, assessment of campers was stopped by the state legislature. “They have wheels, they can move, they really are considered personal property,” Puckett said.
The exemption ordinance would only be for mobile homes that are assessed as personal property. “If a mobile home is assessed as real estate, they will continue to be taxed. They’re fixed to a foundation. They are more permanent, and there were changes previous to 10 years facilitating the retiring of titles and the fixing of those to real estate. That’s not what we’re talking about here. We’re just talking about the mobile homes that are assessed as personal property,” she said.
“So on a rental lot?” Council President Mike Long asked. “On a rental lot, yes, absolutely,” Puckett answered.
She and Chapman put together some figures on exactly what the county has collected revenue-wise compared to what it cost to do the work.
In hard costs, Puckett said it’s roughly cost the county $125,000 annually in personnel, wages, printing, postage and tax statements to assess mobile homes assessed as personal property.
“Kosciusko County, as us when we collect tax dollars, we’ve collected $69,000 for mobile homes that go into our general fund. Countywide, it’s a little over $400,000, but what I want to make sure that you also understand about this revenue is, this revenue is not included in general taxation where tax dollars go. This revenue is not included in our budgets. This revenue does not affect tax rates. The state knows that this income is so volatile or optional, they do not consider this in us setting our tax rates or budgets for the year, which is another reason why it makes sense optionally for county by county to take a look at this,” Puckett explained.
Council Vice President Kathleen Groninger asked if there was a downside to not continuing the assessments.
Long said Area Plan Commission has some questions on how it might adversely affect the county from a standpoint that there might be a “rush to this type of dwelling.” He said he doesn’t foresee that.
“I think down the line it’s not going to be optional, it’ll be mandatory,” Puckett stated. “One of the things that the state is gearing us toward is the elimination of certain sources of taxes. I think this is step one for mobile homes. I think, since this is optional, over 92 counties, there are counties that are anxious - really ready to jump in. I’ve heard about five counties it is a hard ‘no’ and those counties are like Marion County, they’re collecting $4 million a year on mobile homes. So it kind of varies county by county.”
If every county does it differently, she said she could see it causing confusion and conflict for people who move their mobile homes.
“Once we decide to make this decision, it would be incredibly difficult for us to walk it back. So that’s why we brought it to you for forethought and consideration,” she said.
Since the state law takes effect July 1, Long said they need to address it either way before then. In talking to the county attorney, who is working on the ordinance to present to the council, Puckett said she was told that the council can not act on it prior to July 1.
At this point, she said the ordinance would be advertised in June. It would then be brought to the council’s informational meeting on July 3, and then to the council’s regular meeting on July 11 for first reading and adoption.
Councilman Dave Wolkins clarified that the county was spending $125,000 annually to collect $400,000, and if the county passed the ordinance to eliminate the assessment it would not affect the tax rate.
“Correct,” Puckett said. “The $400,000 is distributed to all the taxing entities in the county - schools, townships, libraries, us as county government. Like I said, the hard costs is $125,000 is what we spend to collect that $400,000, so that $400,000 would not be collected, and since it is not considered as part of the budget and the tax rate, this is just additional income that once people receive it, it goes in their cash balance, so the loss of this would not affect anybody’s current budget or tax rate.”
Wolkins said all those groups would come in and say the county cut their revenues.
“Slightly yes,” Puckett said.
Kathleen Groninger asked Puckett if she had heard comments about this from any of the other taxing units in the county. Puckett said no.
“Will the schools be the ones most affected by it?” Wolkins asked.
“Absolutely, since those are the highest tax rates in the county, the schools would be affected more than anybody else,” Puckett said, adding that it would be proportionate to the mobile homes that are there compared to the tax rates.
Middle District County Commissioner Cary Groninger asked if it was just for the mobile homes that are on rented lots, and if a person owns a property in the country and has a trailer on it, that would be a part of the real estate tax and would not be personal property?
“That is correct,” Chapman said. “Real estate is not involved in this, because if they decide not to pay their taxes you could still sell the land and the mobile home at a tax sale.”
He asked if it was possible to get the mobile home parks to collect some sort of tax versus the county trying to do it individually.
“I’ll be honest with you guys, my personal property department sends out a list every single year to every mobile home park trying to get current owner and all that information so that we can assess the right person for the right mobile home. We can’t even get the mobile home parks to cooperate with us,” Chapman stated. “... I can’t tell you how many wheels we spin trying to collect $36 or $40 on these mobile homes. It’s ridiculous, actually, because nobody wants to help us do our part in making sure the right person gets assessed for these mobile homes.”
The problem continues to get worse every year, she said. As more counties opt into the exemption, Puckett said it’ll become more of a challenge to collect the mobile home tax.
Chapman said if the tax is eliminated, a currently vacant personal property position in her office will not be necessary and will be permanently eliminated.
A fire alarm in the Justice Building where the council was meeting ended the discussion and meeting.