If the proposed annexation by the city of Kokomo is approved, it will result in a significant loss of revenue for Howard County offices.
Howard County would see a decline in revenues generated by the County Option Income Tax, Economic Development Income Tax, Local Road and Street and Motor Vehicle Highway funds from the state and other funding mechanisms.
County officials have projected the county will see a decline in revenues of approximately $3 million.
City and county officials are expected to meet next week to get a better understanding of what the annexation plan means and what the impact will be to the county, according to Treasurer Martha Lake.
“Their portion goes up and our portion goes down,” Lake said of the funding shift from the city to the county. “Obviously the county will lose a substantial amount of money.”
Lake said the impact to the county by shifting services such as police protection and maintaining roads in the proposed annexation area to the city is unknown.
“The county still has on-going expenses,” she said.
Lake said with the caps on property taxes approved by the Indiana legislature, it could result in a significant shortfall in revenues to the county.
“We could be forced to increase income taxes,” she said.
Dick Miller, president of the Howard County Council, said the county is short on details when it comes to the impact of the annexation and is in the process of gathering information.
“The jury is still out,” he said. “It would not be right or fair to disparage their desires until I know the numbers.”
Miller said the loss in revenue to the county will be considerable.
“The impact will be large, we’re still working on the numbers,” he continued. “The county doesn’t have $3 million. There will be a huge reduction in services or a tax increase.”
Miller wants the city to provide information on where the county will experience a savings.
“The expense of operating county government will remain the same,” he said. “There is not a lot of duplication between city and county government, not a lot of overlap.”
The meeting with city officials should have taken place a long time ago, according to Miller.
Miller said discussions are taking place on the possible consolidation of some governmental functions, including the dispatch centers.
Commission Brad Bagwell said the county can’t do anything to stop the annexation, but has to inform the public of the impact to county finances.
“Annexation will hurt the county financially,” he said. “How do we provide the same level of services with less revenue.”
Bagwell said the county would not be able to reduce the number of employees as a result of the annexation.
City officials have maintained the savings to the county as a result of annexation will offset any loss of revenues.
“The savings will not offset the costs,” Bagwell said. “We will have less Local Road and Street and MVH (Motor Vehicle Highway) funds, but still have several hundred miles of road in the county to maintain.”
Ted Cain, superintendent of the Howard County Highway Department, said there will be some savings if the annexation is approved.
“It will help us somewhat,” he said. “It means less we have to maintain, but we will lose some funds because of fewer miles.”
Cain said he didn’t envision reducing the workforce for the Highway Department or the amount of equipment needed.
Cain said the highway department is working with fewer people than in the past, but added if someone retires in the future the position may not be filled.
Local News
Annexation will impact county finances
Savings won’t offset costs.
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