With Senate Enrolled Act 183 taking effect Monday, July 1, Kosciusko County Treasurer Michelle Puckett and Assessor Gail Chapman re-presented the proposed property tax exemption for mobile homes ordinance to the county council Wednesday morning.
The council will have a public hearing on the ordinance and be asked to adopt it at their Thursday, July 11 meeting at 6 p.m.
Chapman and Puckett first presented the ordinance to the council on April 4, but because the Indiana law didn’t take effect until July 1, the council couldn’t act on SEA 183 until now.
“This would exempt mobile home personal property assessments. So if a mobile home is assessed as real estate, that is not what we’re talking about here. We’re just talking about mobile homes that are assessed as personal property,” Puckett said.
In 2023, the total revenue Kosciusko County government received from mobile homes was $70,000. Puckett estimated the expenses for the county to provide those revenue figures at $135,000, conservatively.
“In total, at least the revenue that we received, you can see that what we pay for is quite a bit more than what we received. And even though the total revenues that we received are about $450,000, they are broken out to different entities. And these dollars are not used as revenues when calculating the budgets or the tax rates, and they are divided proportionately based off the rate and where those mobile home assessments are,” Puckett explained.
If the ordinance is implemented, she said it would be effective immediately, so the next assessment year, which would be Jan. 1, 2025, is when the exemption would be in place.
“So, mobile homes that are being built this year and collected, this would be the last year for those personal property mobile home tax rolls to go out, the assessments to happen and any of those collections to occur,” she said.
Chapman said, “The assessment portion for our commercial/industrial department has gone up significantly for 1-1 of ’24 for taxes that will actually be collected in ’25.” While she didn’t want to give an estimate because of work still needing to be done, “the money that will be collected in the increased revenues from commercial/industrial will more than make up for what we are losing in the personal property mobile home taxes.”
Councilwoman Kathy Groninger asked if they didn’t do the exemption this year, could they do it next year? Puckett said SEA 183 is part of the current Indiana code so if they didn’t approve it this time, they could at any time going forward.
“But please be aware, if you do not vote it in this year, I have to hire another person immediately in the personal property department. So that is all part of this as well,” Chapman said. “I have one person that left, and I have not replaced her because I wasn’t sure which way we were going to go with this, but if you decide not to vote it in this year, then I have to start looking for someone, and then if you vote it in next year, then I have to look at personnel in that department as well.”
Council President Mike Long asked how much the cost of another employee in that department would be, including benefits. It would total about $72,000.
“So the true loss to the county, right now, with the way it sits is $65,000, because you have the $70,000 roughly you’re taking in and the $135,000 cost. So then you would add $72,000 on to that, so we’re at a loss of $137,000 to the county. However, other entities within the county are going to be giving up $454,000 in (total) revenue,” Long said.
He stated he’s aware that if the county has a revenue loss, that’s something they need to take a look at, but if it’s going to be affecting the revenue streams of other entities, like schools and towns, that’s a concern.
Puckett reminded the council that the exemption down the road may be mandatory, though one can’t predict the future, but this year it is optional. She said some counties will be a “hard no” on the option, while others will be a yes.
“I think we are in the middle. We do collect a good amount of revenue, but we also have larger expenses and we felt that it was our responsibility to bring this to you, for you guys to make this option, because some counties are not even taking it to their council, but Gail and I felt pretty strongly that this is written that it is your guys’ decision. You are the fiscal body. We’re trying to give you all that information to consider, and then we will follow along,” Puckett said.
Chapman said the city of Warsaw area, which probably will be hit the hardest with the loss of revenues, also will see the biggest increases in the commercial assessments and the tax revenue from that as well because the city and Plain Township has the largest number of businesses.
“My personal opinion is I don’t think you’re going to see as great a loss in the tax (revenue) as you think it’s going to be,” she said.
Long said a revenue loss of about $130,000 to Warsaw Schools was significant, as well as the losses to the other schools in the county.
“$130,000 in Warsaw Schools’ budget is pretty small,” Councilwoman Sue Ann Mitchell stated, “compared to the expenditures, the time. Just the time. And as Michelle alluded to, yes, this has been talked about a long time. I think it might have been in my first couple years as treasurer, they talked about trying to do away with mobile homes.”
She agreed that some counties will be a hard no, while for others it’ll be a no-brainer because of the amount of work that goes into it.
“Plus, the percentage of collection, and nobody understands the work that goes into that, trying to trace a mobile home. Trying to track, trying to figure out how to collect that money, and that all goes as a judgment, which is also clogging up a whole lot of other places because it is recorded as a judgment under their name, which seldom ever gets paid,” Mitchell said.
The older a mobile home is, the smaller the assessment. Many mobile homes are used seasonally, and many aren’t higher dollar. Those that are higher dollar are usually assessed as real estate, not personal property. Chapman said the majority of the mobile homes in Kosciusko County are 1980 and older in mobile home parks.
Long said he would like to hear from the townships, cities and towns on the ordinance. If anyone has any objection to it, he said the council’s meeting on July 11 would be the time to let it be known.
“If I don’t hear any objections, I could lean one way just as fast as the other way,” he said. “If people are really going to be upset by this, I would like to hear why.”
Puckett said Thursday’s meeting was the second time they presented on the ordinance, with the first time being April 4. The story was picked up by the local media, and she was prepared to receive some phone calls, especially since that was right around tax time.
“Not one comment. Not one call. Not one email. Again, to me, it reaffirmed the fact that what we’re explaining is, is these are revenues that are outside the budget, that are not considered in the tax rate, and are proportionate to their collection,” Puckett said. “Yes, the larger schools, it looks like they’re going to take a hit, can they afford that? This isn’t money they count on anyway because it’s not a guarantee, and their budgets are so large, this is probably less than a 0.001. It’s not something that would be noticeable to them. And what reaffirmed that to me is the lack of phone calls or questions or concerns on behalf of any of those taxing entities.”
Puckett said what she and Chapman were proposing at the council’s July 11 meeting was both the public hearing on the ordinance and the adoption of it.