The Clay County Council passed a 1-percent Local Option Income Tax (LOIT) in October 2009, which is split between two different purposes, and the effect is showing on property tax bills.
"Seventy-five percent of the LOIT is for property tax replacement, which came back at a rate of 46 percent," Clay County Auditor Mary Jo Alumbaugh told The Brazil Times. "However, only residential properties under the 1- and 2-percent property tax caps are seeing the difference on the bill."
From this portion of the LOIT, the county is receiving $3,031,488.91 this year, which will be distributed among the 20 taxing units. Alumbaugh and Deputy Auditor Nancy Coleman said this funding is direct relief for the effect of the Circuit Breaker.
"We looked into what percentage the LOIT needed to be to simply offset the losses anticipated with the Circuit Breaker before it was passed," Coleman said.
The work of the Auditor's Office and the County Council has made a difference.
Rather than the taxing units losing $508,862 in property tax monies -- which was the estimated effect of the Circuit Breaker for 2010 -- only $2,452.40 will be lost.
Brazil Civil City and the Clay Community School Corporation (CCSC) are the biggest benefactors of the LOIT, as they had been estimated to lose $140,936 and $238,908, respectively. However, the effect of Circuit Breaker Credit is only $839.96 for Brazil Civil City and $903.89 for CCSC.
The other 25 percent of the LOIT was designated solely for Public Safety, which Alumbaugh said would probably not be included until 2011 budgets are prepared.
"The amount to be received through the Public Safety LOIT is $1,039,365.33, which is being collected throughout the year in 12 payments," she said. "These are new dollars for public safety purposes only, such as law enforcement and fire protection, and the council has not addressed exactly how the county's portion will be allocated."
Alumbaugh added the funding could be used to provide relief on the county's General Fund, which was boosted this year by using a portion of the Rainy Day Fund.
Alumbaugh told The Brazil Times the amount received by the LOIT -- which is part of the County Adjusted Gross Income Tax -- can fluctuate from year to year.
"The total amount of LOIT collected depends on the amount of income generated in the county," she said.