The Porter County Council has scheduled a meeting for Wednesday to continue to discuss the possible options for helping out local units of government as they await their delayed property tax distributions.

Over the past few weeks, county council members have discussed tapping part of the $7.6 million in interest earnings from the hospital sale to help out the cash-strapped municipalities and possibly other local taxing units that have been hit hard by the late tax bills.

Initially, the thought was for the county to reimburse local taxing units for their borrowing costs, and the Indiana Department of Local Government Finance initially said that there is no provision in the law to allow such a reimbursement. County council members, however, continued to explore the possibility of using the hospital interest earnings, and on Thursday, the DLGF cited Indiana’s home rule statue in saying that it is not aware of any legal prohibition against using the hospital funds for that purpose.

Under the home rule law, a taxing unit like the county has certain powers even if these are not specifically granted by state statute. So while the law doesn’t expressly give the county the authority to use hospital proceeds to pay the borrowing costs for local tax units, there is nothing to prohibit it either, said DLGF communication specialist Amanda Stanley.

At last week’s meeting with municipalities, several county council members indicated a willingness to help local taxing units, but expressed concern about the possible consequences and whether the county funds would be counted against the units’ levy restrictions.

County Council President Bob Poparad, D-1st, said the council still doesn’t have a clear idea of how the taxing units’ levies could be impacted but that it hopes to have that answer by Wednesday.

The special meeting has been set for Wednesday at 5 p.m. at the County Administration Center, Valparaiso.

Posted 10/16/2009