For Vigo County, an early payment of more than $3.25 million equates to getting 16.6 percent of those funds in May instead of 11.4 percent, said Kylissa Miller, chief deputy county auditor.
Dan Bastin, settlement director for the state auditor's office, notified all 92 county auditors and treasurers via e-mail after the governor's announcement that the state money "is connected to the May 2008 and July 2008 property tax replacement credit and state homestead credit distributions. The combined May and July distribution amounts will be distributed at the end of May and there will not be a July distribution."
Daniel's announcement states he ordered $212 million "long owed to local governments be repaid by the end of May, a year ahead of schedule." The state had been scheduled to send $106 million to local governments this month.
Miller said the distribution, made a few months early, will allow Vigo County to generate some interest. However, because of property tax law changes, including impacts to Tax Increment Finance, or TIF, districts, Vigo County officials are anticipating tax bills will not be sent out until mid- to late July, with tax funds collected mid- to late August.
"Since we don't have tax rates currently [the early payment] will have to be distributed to each unit based on 2006-pay-2007 tax rates," Miller said. "That is from instructions from the state auditor's office."
In a statement, Daniels said the funds could be distributed early because of the state's financial status.
"As the only state in the Midwest that is in the black fiscally, we're being extremely careful about every dollar. But the very strong March and April revenues strengthen our confidence that we will register a fourth straight surplus this year, and that we can accelerate this final repayment of the debts the state once owed to schools and towns," Daniels said.
"With this year's property tax cuts, we've entered a new era of taxpayer protection. We know there will be an adjustment period for local taxing units and want to do all we can to help," Daniels said.
The most recent monthly revenue report, for April, showed that for the current fiscal year to date, state total revenues exceed forecast by $133 million while spending is being held below budget, according to the governor's office.
The governor stated that in 2002, state government delayed payments totaling $761 million to K-12 schools, higher education and local governments because of "deficit spending." The delays are essentially a bookkeeping maneuver that pushes spending obligations into future budget cycles so they do not count against the current one.
In 2006, the state began repaying those funds, mostly to K-12 schools. That includes $156 million for K-12 schools in January 2006 and the $160 million in July 2006. In May 2007, $131 million was distributed to local governments, according to the governor's office.
Also in 2007, $40 million was distributed to higher education and $31 million this fiscal year. The remaining $31 million will be distributed in the next fiscal year, according to the governor's office.
Howard Greninger can be reached at (812) 231-4204 or howard.greninger@tribstar.com.
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