Expect less money and be prepared to make difficult decisions was the message members of the Montgomery County Council heard from the county’s financial advisor.
On Tuesday, Jeff Peters of Peters Franklin LLC provided a financial presentation, the first since the state legislators approved major funding changes as part of Senate Bill 1. The bill includes broad sweeping changes in real estate taxes and funding for municipalities, townships, school districts and counties.
“Like they have been trending the past several years, the state is trying to push local governments to be less dependent on real estate taxes for more local income taxes,” Peters said.
Senate Bill 1 decreases property taxes for most homeowners, for at least until 2028, Peters said.
At the same time property owners can expect to pay more in local income tax after the bill increased the maximum percentage of income a taxing unit can collect from county residents.
Peters said with the reduction in property taxes due to a increased $300 homestead credit, a raise in local income tax will not cover the loss of the tax revenues.
Councilman Brett Cating summed up the complex tax bill with one statement.
“Unless the law is tweaked some mores the state is forcing us to decide what services we will have to cut,” Cating said. “Are local governments going to have to decide to cut police, fire or other services?”
Peters told the council that the county’s finances are in better shape than several other counties for now.
Council members thanked Peters for the report.
Before Peters spoke, Montgomery County Highway Director Jake Lough presented a report on wheel tax funding.
Lough reminded council members they had asked him to report on the benefits of raising the wheel tax to the maximum amounts the state allows.
Lough presented information showing the county has made some gains in road preservation, he said the county still does not have enough funds to adequately maintain roads.
Lough also reported the popular state road funding program Community Crossings Matching Grant program will have less money to distribute in the future. Those funds might not be readily accessible as in the past few years.
“The state is pushing us to increase our wheel tax,” Lough said. “We are going to have to consider it, because I don’t want to go backwards on road maintenance.”
The council approved a $1.5 million loan from the county general account to commissioners in order to help pay for the water project along Nucor Road. The short-term loan will be paid by grant proceeds scheduled to be available no later than August.
The council approved the hourly rate of $30 for an intern to work in the Public Defender’s Office. An intern was also approved for the prosecutor’s office.
The next council meeting is scheduled for 9 a.m. June 10 at the Montgomery County Government Center.
