Two of the three Bartholomew County commissioners say they are in favor of creating a new fund for the construction or improvement of major infrastructure projects.
Retiring commissioner Paul Franke said that, if approved, a cumulative capital improvement fund would be financed by an increase in property taxes of
4 cents per $100 of assessed valuation the first year, followed by up to 7 cents annually in subsequent years. The idea has yet to come to a vote, however.
During a meeting with commissioners Thursday, County Council President Bill Lentz said his council colleagues did not want to “stick their necks out” with a tax hike to fund a new county office annex building. But Franke said during Monday’s commissioners meeting that the commissioners can create the fund without the council’s approval.
“Yes, it’s going to be an additional tax,” Franke said. “But if we want to move ahead, somebody will have to take some lumps. Sometimes you have to do what you feel is best.”
County tax consultant Dan Eggermann pointed out Thursday that Bartholomew is one of only a handful of Indiana’s 92 counties that does not have a cumulative capital improvement fund in place.
During that same meeting, County Attorney Grant Tucker indicated that he thinks now is as good a time as any to create such a fund.
“It’s not going to get any better four or five years from now,” Tucker said. “People will still have a disdain for taxes, and the economy won’t be that much better. It takes a little political fortitude to bite the bullet and just do it.”
Commissioner Carl Lienhoop said Monday that the fund appears to be the most doable and painless method of financing a new annex building, which would replace a current facility deemed to be a health and safety hazard.
“One of the things I like about it is that you can adjust the rate at any time,” Lienhoop said of a cumulative capital improvement fund. “You can suspend the enactment of it at any time, or put it in place just for one project.”
A new annex building is projected to cost between $3.5 million and $5 million. While the commissioners want the building to serve as a catalyst for new development along State Street, they say it can be both attractive and cost-efficient. County council members have asked the commissioners to put a higher priority on safety and functionality than aesthetics.
Lienhoop said the fund also might be tapped at some point for improvements or replacement of the county highway garage.
Lienhoop said the 60-year-old garage, located on a seven-acre site south of the current annex building near State Street and Gladstone Avenue, is not large enough to contain all of the department’s equipment.
“It has a lot of deficiencies,” Lienhoop said. “It has walls that are severely cracked, and the roof in the shop area needs to be replaced.”
He estimated that a new roof would cost about $70,000.
While Lienhoop also gave an estimated cost of $1.7 million to $2 million for a new county highway garage that would meet federal environmental standards, he gave no indication that a new garage was being considered at this time.
But Lienhoop did say the county also needs additional storage room for the salt mixture that’s used on roads during the winter. He said the current wooden salt barn, east of the garage, isn’t nearly large enough. Much of the salt now has to be stored outside.
The fund also could be used to pay for future repairs at the historic Bartholomew County Courthouse, according to Lienhoop.
Commissioners President Larry Kleinhenz did not attend Monday’s meeting, but he had expressed reservations Thursday about creating a capital building fund.
He said that if the county had set aside money annually for new buildings or renovations in the past, those funds likely would have been spent on other projects.
Kleinhenz’s concerns are based on a provision that allows money from the fund to be used for other purposes to protect the public health, welfare or safety in an emergency situation.
A number of cities and counties in Indiana have used a broad interpretation of this provision to transfer money out of the fund and instead spend it on such items as new police cars and other non-construction projects.
The capital improvement fund, as proposed, would finance the issuance of bonds. However, two other methods of financing a new annex building were examined during Thursday’s meeting:
n Allowing private investors to finance the structure through a building corporation and lease the property.
n Borrow $2 million annually from a bank and pay off the loan within six years.
One of the methods could be used exclusively, or the county could create a formula that blends one or more of them with existing funds.
Due to a $2.55 million windfall received last spring from the state, Bartholomew County has adequate money to finance a portion of the project through the economic development income tax fund, as well as the county’s rainy day fund.
Eggermann said leasing the facility would be the most costly option, but that interest rates now are low enough to make borrowing and bonding comparable.
“But if you don’t want to put a tax rate on it, you’ll have to use money you already have,” Eggermann advised.