INDIANAPOLIS – The State of Indiana Office of Management and Budget Director Adam Horst announced Thursday that the state has uncovered approximately $206 million in underpayments to local units of government.
Kosciusko County is scheduled to receive $2.5 million.
Due to today being Good Friday, no county government officials were available for comment on what the county may use the funds for.
Indiana Association of Cities and Towns Executive Director and CEO Matt Greller informed all IACT members that in an early morning meeting with several affected parties, Horst revealed that since January 2011 the Indiana Department of Revenue has improperly calculated income tax revenues, resulting in local units receiving less than their lawfully guaranteed distributions.
In his message Greller stated, “IACT believes the State has uncovered the error and acted swiftly to rectify the situation. While we appreciate their aggressiveness in remedying this troubling situation, we are concerned about the long-term implications for taxpayers and cities and towns. This failure has likely impacted not only the basic delivery of services, but resulted in fewer dollars going to property tax relief and greater property tax cap losses to local units of government.
“When errors of this magnitude occur it causes a significant loss of confidence in the system. We are glad to hear that the governor and OMB Director Horst have ordered a third-party audit of the Department of Revenue and we will be anxiously following their findings,” Greller noted.
Counties should be expecting to receive two distributions in their bank accounts as early as today.
They will receive a makeup payment for all undistributed revenues from 2011 and a payment for all undistributed 2012 revenues to date. Counties will then be responsible for distributing these dollars appropriately and swiftly to local units.
