At the Kosciusko County Council meeting on Thursday, May 8, Kosciusko County Commissioner Ron Truex came before the council to express that Kosciusko County was in dire straits financially. Umbaugh, a financial advisory firm out of Indianapolis, has been working with the county to identify problem areas in the budget and recommend strategies to rectify them.

Umbaugh’s findings were presented to the county council, Kosciusko County Commissioners, and the public at a joint meeting on Thursday, May 22. We’ve provided that data in the slideshow below, but a paragraph from Umbaugh’s executive summary adequately sums up the issue.

“An analysis of the County’s financial activity from 2011 to 2013 shows that cash balances in the main operating funds have decreased approximately $3,000,000 since 2011. Over the last 2 years, the disbursements of operating funds have exceeded annual receipts by $1.8 million (2012) and $1.3 million (2013). If budget estimates hold true, the County will deplete approximately $4.4 million of cash reserves by the end of 2016. If action is not taken to correct budget deficits, the County is expected to fall below the recommended minimum cash reserves (15% of operating disbursements) in key operating funds including General and Motor Vehicle Highway. This could result in the County being unable to provide the level of public services expected.” [sic]

The fund hit hardest by this trend is the county highway fund, as evident by the deteriorating roads throughout the county. The council and commissioners felt the most sensible way to bring revenue to the fund is by enacting a wheel tax in Kosciusko County.

“Our state legislators, in a comment to me, said we’ve given you a tool that you can use to fix your roads,” said council president Robert Sanders. In Indiana, the wheel tax has been an option since 1980, and 47 counties have already adopted it.

If enacted, a surtax up to $25 per year would be collected from vehicles registered in Kosciusko County weighing less that 11,000 pounds, such as passenger vehicles and motorcycles. A wheel tax up to $40 per year would be collected from tractor trailers and other large transport vehicles.

Umbaugh projected that the wheel tax could supply the county unit with $1,770,000 per year. “This money is highway department money,” stressed Truex.

To put the public’s cost in perspective, Sanders noted that this yearly cost was less than a tank of gas. Furthermore, he noted, “it’s less than it costs to get your car realigned after hitting one of these big pot holes.”

“I think people are ready to accept the fact that it’s going to cost $25 more a year,” said Truex. Commissioner Bob Conley added, “When you have a winter like we’ve had, the additional $25 – one time a year – I think the public is willing to do.”

For the county to see this wheel tax revenue in 2015, the tax would need to be enacted by June 30 of this year. The county council intends to take the wheel tax to a vote at it’s June meeting on June 12. Sanders encouraged the public to attend the meeting and offer input.

Umbaugh had several other recommendations for fixing the county’s revenue deficit. We will be covering those in a separate article that will be posted soon.