Commissioners Try to Sell Need for Sales Tax Increase

The Marion County Commissioners held an open forum Tuesday evening to explain the need for the half percent increase to the local sales tax. The event held at the Marion Public Library only drew a few people, but provided details on the county’s budget situation. Even with the explanation, many in attendance did not change their opposition to the measure. Several in fact were protesting the tax outside of the library.

Commissioner Ken Stiverson led the presentation and said the county expects to have a carryover of about $779,000 at the end of this year. He says the county needs about $1 million for the first three months of 2012, so there are things that must be done to ensure those funds are available. He said this may include not paying some vendors until after the first of the year.

With no increase in expenses, the 2012 carryover would be just $43,500 and then the county would have a negative balance of $2.5 million at the end of 2013.

Stiverson said that with the sales tax increase and a 3% increase in expenses, the 2012 carryover would be boosted to $1.1 million and the 2013 balance would be $888,000. This is not taking into consideration possible increases in revenues from any recovery in the economy.

Sales tax is main source of revenue for the county, which receives just 1.5 percent of the 7.0 percent total tax. When it comes to property taxes, the county’s general fund only receives about 5 percent of the total bill.

Stiverson said that county revenues have decreased $3.5 million since 2007. In turn, he said the county has cut expenses by nearly $2 million.

Decreasing Revenues
One thing that has been hurting the county budget, Stiverson said, is investment income that has decreased by about $1.6 million from 2007 to 2010. He said the county used to get 5 or 6 percent, but it is down to about half a percent. He said that a recent renegotiation may result in a one percent return.

Another well publicized source of decreasing revenue is from state funding cuts. For the county, these cuts are expected to total $655,000 in 2012 and nearly $800,000 in 2013.

Rising Expenses
When it comes to expenses, Stiverson pointed to two areas – indigent defense and debt.

Expenses for indigent defense (attorneys for those who cannot afford them) are up 20 percent from 2008 to 2010. For the current year, the county budgeted $475,000, but has had to appropriate an additional $150,000. Stiverson said this is due to several murder cases.

Debt payments are costing the county nearly $700,000 this year. Much of these were paid for by special funds, including one created with the sale of the former East Lawn Manor property several years ago. The commissioners said these funds are now tapped out due to the decrease in investment returns.

Stiverson said the county has been trying to battle the decreases in revenue. Departments took a 6 percent cut in 2009 and a 20 percent cut in 2010. In 2011 the departments maintained their 2010 budgets. Stiverson also said county employees pay 10 percent towards their pensions and 15 percent of their medical insurance (30 percent for dependents). He also mentioned that many employees are paying for expenses out of their own pockets. Stiverson said he paid for his own training earlier this year, including travel and lodging.

The Future
Should the sales tax increase be passed by voters, the commissioners said they plan to maintain services, deliver the best services they can for the money, continue to fund present and future state mandates, and sustain and seek future cost-saving measures. Stiverson also said that no additional cuts would be planned for the sheriff’s office or the multi-county jail.

Stiverson said the emergency enactment of the sales tax increase prevented an immediate budget cut of 20 percent. If it fails in the November election, departments will be required to take a 12 percent cut.

“People have to realize that we will have to make cuts. It won’t be pretty for the safety part of it.” Stiverson.

Sheriff’s Office
Tim Bailey, Marion County Sheriff, said that many seem to talk about how Union County and part of Delaware County will have a lower sales tax than Marion. He said that it’s hard to compare with those counties because both have levies that pay for their 911 system which Marion does not.

Bailey also said that while national statistics say crime is down, crime is not down in Marion County. Even with that, he said that as the department loses staff, arrests are inevitably down. With a smaller staff, Bailey said times have increased for responding to crimes.

The situation is expected to get worse, according to Bailey. He said the 28 cent tax that appears on cell phone bills equals about $12,000 to $14,000 a month and is used to pay for dispatching. That tax is set to expire next year.

Bailey also mentioned the portion of property taxes that goes into the county’s general fund. He said he most recent tax bill was $1,600 and that means he pays just $16 towards the sheriff's office.

Correctional Center
Dale Osborn, the director of the Multi-County Correctional Center, said, “We're in survival stage now.”

He said the jail used to rent out beds to other counties to bring in supplemental funds, but there are no beds currently available to rent
"It is unbelievable what is going on in our community," stated Osborn, talking about the local crime increase.

Osborn said the jails staff has been reduced from 51 to 35 and one more is leaving a position that will not be filled. He said that means on a average shift, there are seven officers to watch 182 inmates.

If additional cuts are required, Osborn said the female section will have to be closed and it's full every day. The problem is the county will still have to house these people somewhere and that means additional funds sent to other counties. That means there will be no real savings to the county. It will simply be a reduction for the Multi-County Correctional Center.

Osborn said medical expenses are a major concern at the jail. So much so that if an inmate has to go to the hospital, they try to release them to avoid paying the costs. He said they try everything to get the medical bills paid for by insurance or the inmate themselves. Osborn said one medical expense is prescriptions which equal $3,000 per month. He said they are now using free antibiotics from Meijer and Walmart.

Questions
After the county had outlined their reasons for the sales tax increase, there were less than 20 minutes left to answer questions. That proved to be far too little time.

One person asked Sheriff Bailey about the possibilities of a metro-style law enforcement agency. Bailey said that is certainly possible, but it would require the City of Marion to contract with the sheriff’s office to provide that service. He did not say how much that contract might cost.

When asked about the possibility of enacting a quarter percent tax increase should the half percent increase fail, the commissioners said they would have to wait at least one year to make any increases. They also pointed to a chart that showed the quarter percent increase would not be sufficient.

Another person asked where the county pays for two clerk of courts. One is elected, but the other covers the family courts. It was explained that the family courts act as their own clerk of courts by state law.

The meeting ended with some back-and-forth on how the tax increase was enacted. The commissioners said they approved the increase when they did for several reasons. One was to allow enough time so that the increase could start being collected in October in order for it to be received in January. If they had waited and placed the issue on the ballot, they would not have received any benefit until July 2012 and that would have been too late.

Another reason stated was to allow voters the chance to place the issue on the ballot if they wished. They did and the issue appears on the November 8 ballot.

The commissioners will hold another session at the Marion Public Library on Wednesday, November 2, at 7:00pm.

To view the information presented by the commissioners, click here.

Click here to view the five year forecast for the county which includes figures based on various revenues and expenses.