INDIANAPOLIS – The Indiana Medical Licensing Board on Thursday lifted the emergency suspension of a Fort Wayne oncologist who in January was charged with leading police on a high-speed chase while having illegal drugs in his system.The Allen County Auditor’s Office warned that the county likely faces decreasing tax revenue for the next five years and urged the County Council to begin saving now to soften the blow.
Deputy Auditor Tera Klutz told the council that the revenue that pays for county services is dropping and is likely to continue downward. Those revenue sources include property and income taxes, miscellaneous fees and other taxes.
Klutz said Auditor Lisa Blosser recommends setting aside $5.6 million in the general fund to cushion the blow to the county’s 2011 and 2012 budgets.
The county already has $18.7 million available in its rainy day fund. Coupled with $5.6 million in additional savings, the county would have $24 million available to offset decreasing tax collections or cover unexpected expenses such as an increase in health care costs, Klutz said.
It would also be enough to prevent the county from having to raise property taxes or income taxes or reduce county services, according to Klutz.
The move would leave the council with $3 million in cash to provide for unexpected requests from departments during the rest of this year, she said.
The council did not debate Klutz’s report Thursday or take any action. But council members will need to discuss whether the recommended $5.6 million is too much or not enough to set aside, said Council President Paula Hughes, R-2nd.
Hughes said she is more concerned about reduced income tax revenue than about receding property tax collections.
The state collects income taxes for counties but distributes that money at least one year behind. The collections are now in their second year of decline, Klutz said.
Based on five-year revenue projections, income tax collections might rebound enough by 2015 to match 2009 levels, Klutz said.
Last year, the county received more than $13 million in income tax revenue.
In addition to Indiana’s new caps on property taxes, which take full effect this year, the recession will further affect property tax collections.
The auditor’s office predicts that assessed property values will shrink, Klutz said, and the county will collect less revenue.
The caps on property taxes are expected to reduce Allen County’s general fund by $3.2 million this year.
The county expected to collect $50 million in property taxes for the general fund in 2009.
Other revenue, such as fees to the county clerk and interest income, are also declining, Klutz said.
