On split vote, public safety income tax committee recommends: No “off-the-top” allocations this year for rural fire departments

A committee of the Monroe County tax council voted Tuesday morning against a recommendation to allocate $353,700 of public safety income tax money to support requests made by four rural fire departments in the county.

The potential direct allocation of funds to the fire departments would have made up about 4.5 percent of the $7.8 million that the committee was using as a conservative estimate for the total amount it could allocate for 2021.

The distribution of local income tax revenues for 2021 is based on 2019 income tax filings, which have been delayed because of relaxed deadlines due to the COVID-19 pandemic.

The vote on the seven-member PS-LIT (public safety local income tax) committee was 2–5 for the direct allocation of the funds to the Monroe County Fire Protection District, and fire departments serving Richland, Bean Blossom, and Benton townships.

The tally flipped to 5–2 for the committee’s vote on its recommended allocations for 2021 public safety income tax revenue.

The dispatch center—which is a public safety answering point (PSAP)—is recommended to receive its requested budget of $2,247,490.

The remaining amount is recommended to be divided, through a property-tax-footprint-based formula, among Bloomington, Monroe County, Ellettsville and Stinesville. In round numbers, that works out to about $2.8 million for Bloomington, $2.5 million for Monroe County government, $165,000 for Ellettsville and $1,100 for Stinesville.

The working estimate of $7.8 million is 90 percent of this year’s total public safety income tax distribution to the county. That was generated by a rate of 0.25 percent, which will remain the same next year.

The pair who voted for the direct allocation to rural fire departments were county councilors Cheryl Munson and Geoff McKim. The county council had been tasked by the PS-LIT committee with reviewing the applications from the rural fire departments.

The county council voted at its July 28 work session to recommend $353,700 in total awards to four departments to pay for mobile repeaters, a station remodel, and exhaust systems.

The five who voted against the direct allocation were the four Bloomington city councilmembers on the committee (Jim Sims, Isabel Piedmont-Smith, Sue Sgambelluri, and Ron Smith) and Ellettsville town councilor Scott Oldham.

Looming projected shortfalls of local income tax revenues in 2022, even if not for 2021, led Bloomington city council representatives to scrutinize the requests in terms of their urgency. Last year, rural fire departments received direct allocations for self-contained breathing apparatus.

Piedmont-Smith said the funding last year for breathing apparatus was essential to the safety of firefighters. She added, “This year, and in the era of COVID-19, where we are looking at reduced revenues for city government and all levels of government, in the coming few years, I am becoming very focused on the city’s needs, because I am a representative for the city of Bloomington.”

Piedmont-Smith said she would be voting no, because she was “not really moved by the urgency of the requests.”

Sims said, “We do know as part of our budgeting process, there are public safety needs that we, as city-elected representatives, must consider.”

Oldham focused on the request of the Monroe County Fire Protection District for a station remodel. “I’m sorry, I don’t see that as an urgent safety need. That’s not an urgent safety need. And that’s not something we’ve done before.”

Munson responded to concerns about urgency by saying that the county council had considered only the most urgent needs among the requests from the rural departments. The $353,700 in recommended awards had been winnowed down from a total of $742,000 in requests, Munson said.

Another reason city and town committee members gave, for not supporting direct allocations to rural districts, relates to future consolidations. At the time when the Monroe County Fire Protection District (MCFPD) consolidates with another department, it can adjust its property tax millage to a rate that’s high enough to pay for its needs, they said.

The MCFPD looks like it might eventually encompass all rural fire departments. Benton Township is next in the sequence of consolidations. An initial public meeting on the consolidation of Benton Township’s fire department was held Tuesday night.

The projects requested by the rural districts could still be funded with 2021 public safety income tax revenue, even if the full tax council ratifies the committee’s Tuesday morning recommendation.

But the rural districts would not receive the funding directly, “off the top” of the distribution, before the four jurisdictions split out their respective shares.

If the rural districts don’t receive funding “off the top,” that translates into additional revenue for each jurisdiction. And Oldham suggested that a jurisdiction could make “sub-awards” for a projects—if it chooses to do that.

The Monroe County council could, for example, use the additional $160,000 it will receive—if the rural departments don’t get a direct allocation off the top—to pay for the exhaust system and mobile repeaters requested by Bean Blossom’s department ($83,700) and the exhaust system requested by Benton Township’s department ($80,000).

Not long after the morning meeting of the committee had concluded, Monroe County councilor Marty Hawk was critical of the committee’s recommendation in a Facebook post, saying, “The city appears to believe if the fire departments receive any money it should come out of the share the county receives. Guess they believe all of the city residents work only in the city and shop only in the city. They have no need for fire protection while at work, etc.”

Reached by The Square Beacon, Hawk pointed out that the committee’s vote was just a recommendation and the decision on the matter won’t be made until a vote is taken by the full tax council. That’s a body consisting of the Bloomington city council, the county council and the Ellettsville town council.

A revision to tax law passed during this year’s legislative session changed the bloc nature of vote allocations. Previously, all of Bloomington’s 58 votes, out of the 100 available, were allocated based on the majority vote of the nine-member Bloomington city council.

Now, each individual member of a governing body is allocated a proportionate share of the group’s allocation of votes.

Hawk advocated in her Facebook post for a change to state legislation on income tax: “It is time for a complete change in the income tax legislation at the state level, so the city will no longer be in charge of the income tax.”

During the committee meeting, McKim also supported reform of the income tax code: “I just want to say to my city colleagues here, …I fully understand your skepticism here at supporting the rural fire districts. This is why I don’t like the structure of the tax, and I will continue to advocate at the statehouse level for tax reform.”

McKim added, “I agree you were being put in a position of potentially voting on …revenue to be diverted to people that, by definition, you don’t represent.”

McKim concluded, “I’m not holding you responsible for what I think is a badly structured tax. So I’m just saying that this will redouble my efforts to work with the General Assembly to reform local income taxes in Indiana.”