* Amount less than 2008 total
The effect of the property tax caps on Clay County is minimal this year, but things won't be looking up in the near future.
Clay County is being allotted a maximum property tax levy of $3,051,087 for 2009, which $151,105 less than what was allowed in 2008.
However, because of the property tax caps at 1.5, 2.5 and 3.5 percent this year, it is unlikely the county will receive the complete amount.
"For all taxing units throughout the county combined, there is an anticipated shortfall of $132,035.87, with an additional shortfall of $20,626.37 from the Over 65 Circuit Breaker," Clay County Auditor Mary Jo Alumbaugh told The Brazil Times. "Once we determine the Circuit Breaker's affect on the county alone, we will have to go in and adjust our estimated end-of-year operating balances accordingly, but it is obvious we won't be able to collect our full levy amount because of the tax breaks."
Clay County Council President Mike McCullough told The Brazil Times the county is in good shape at this time because current operating balances are healthy, but some tough decisions may have to made the next year or two when the caps go down to 1, 2 and 3 percent.
"I haven't had an opportunity to look at the potential loss in property tax revenue for next year, but I'm sure it will be more than this year," McCullough said. "There really is no positive way to combat the loss of funds, but my personal preference is to make cuts to services and employment, and make them as minimal as possible, rather than institute a Local Option Income Tax."
He added the county is in the process of transferring the responsibility of the parks to the respective communities, but the financial impact would bring minimal savings.
"We're going to end up having to reduce our operating balance, which is something we can't do every year," McCullough said. "For me, a Local Option Income Tax is a last resort, but the way things are going, we will eventually have to do it. Changes coming from the state legislature are all but forcing us to consider and institute it."
A large reason the county's property tax levy is lower than last year is the loss of $268,453 in funding (from 2008 figures) from the elimination of five separate funds, including many involving welfare, because the state has taken over the responsibility for them.
Of the seven funds receiving a property tax levy in both 2008 and 2009 -- General, 2006 Reassessment, Cumulative Bridge, Health, Park and Recreation, Aviation/Airport and Cumulative Capital Development -- only three have a higher maximum levy than last year, including:
* General -- $221,958,
* 2006 Reassessment -- $7,700, and
* Aviation/Airport -- $1,315.
The Park and Recreation Fund has a levy of $ 9,927 less than 2008, while the remaining three levy funds are receiving at least $26,000 less than last year (see table).
"However, because of the effect of the property tax caps, the majority of the funds will be underfunded," Alumbaugh said. "Everyone gets their share of the pie, so to speak, but each year, the pie is getting smaller and making things tougher."
Alumbaugh added should one fund get down to a zero operating balance, it can borrow from other funds with available cash, but it must be returned by Dec. 31 of the year in which it is borrowed.
While many of the county's funds are anticipated to have healthy operating balances at the end of 2009, options are being pursued to keep things running smoothly.
"There are times when you do things one way for so long, it isn't a bad idea to make some modifications for better efficiency," Alumbaugh said. "Right now we are exploring options and we want to work with the other taxing units to come up with possible solutions to continue providing the services and employment we do, without placing a larger burden on the residents. However, in the process, some sacrifices may have to be made."
The 2009 certified budget orders for all taxing units in Clay County may be viewed at http://www.in.gov/dlgf/2612.htm.
County tax levies
The following table outlines maximum property tax levies of Clay County funds for 2008, 2009 and the difference. Only funds receiving levy funding in both years are included (see note below table).
|Fund||2008 tax levy||2009 tax levy||Difference|
|Park and Recreation||$24,738||$14,811||($9,927)|
|Cumulative Capital Development||$175,914||$149,670||($26,244)|
Editor's Note: Starting this year, tax levies for the following funds have been eliminated as the state has taken responsibility for them: County Welfare Family and Children, County Hospital Care Indigent, County Welfare MAW (Mothers for Adequate Welfare), County Welfare CSHCN (Children with Special Health Care Needs) and Children Psychiatric Residential Treatment. The total levy funds lost from these areas (based on 2008 figures) are $268,453.