Porter County’s delayed 2009 property taxes didn’t exactly need another wrinkle, but one did emerge Tuesday when County Auditor Jim Kopp said he would prefer sticking with the county’s previous tax software vendor that county officials recently agreed to replace.

Kopp told the Porter County Council Tuesday that while he’s willing to work with either vendor, he believes the previous software provider, Hamer Enterprises of Texas, would do a better job for Porter County.

His comments touched off already-escalated frustrations among county council members, who had an update of this year’s property tax bills on their regular agenda. In the end, the council set a special meeting for Wednesday of next week to try to resolve the disagreements.

County officials, including Kopp, recently agreed to replace the Hamer system in the auditor and treasurer offices due to a variety of glitches that some blamed for the delays with the 2008 tax bills, which didn’t go out until March of this year. County officials recently agreed to purchase a different system from Low Associates of South Bend, but language disputes have held up a final contract with Low.

Further, at least two other issues are holding up the work on the 2009 tax bills: LaPorte County still has not certified the assessed values needed for Porter County to issue final 2008 tax bills in Pine Township, and the county assessor’s office just submitted a state-ordered revised ratio study that needs state approval.

County Information Technology Services Director Sharon Lippens told the council that even if the new assessed values were ready to roll from the assessor’s office to the auditor’s office, the county doesn’t have tax software to use. She said Low just completed the data conversion last week, but that Kopp needs to sign off on that conversion but indicated Tuesday that he wants to stick with Hamer after all.

The only other hold-up with the system is the disagreement over the contract language. Otherwise, she said: “We’re ready to roll.”

Kopp noted that Porter County still needs to complete the final 2008 tax work as well as the 2009 bills, but that the Low system cannot handle both years of data simultaneously. Lippens disagreed, saying that Low is a multi-year vendor.

The dispute over the software touched off nerves. At one point, Council President Robert Poparad, D-1st, said he was ready to explode over the tax delays and said that it seems that no matter what county officials do, they don’t seem to make progress. At another point, council member Dan Whitten, D-at large, raised his voice to a shout level.

“I can’t believe this,” Whitten said. “There’s no way I’m going to stick with Hamer.”

Kopp compared the two software vendors to models of vehicles, likening one to a six-cylinder and the other to a better make. But council member Laura Blaney, D-at large, noted that Low is state-certified already, while Hamer is not. “It kind of sounds like the six cylinder is Hamer,” she said.

Council members agreed that a Low representative should be invited to next Wednesday’s meeting to sort out what its system can and cannot do.

The council’s tax discussion began with a proposal by Kopp to issue what’s known as “requests for payments” during the first half of July. The payment requests would not be actual tax bills, but would be based on 50 percent of the final 2008 tax bills, after removing levies that are now being picked up by the state.

Kopp said the requests for payments would give taxing units some operating funds until the actual, final tax bills go out, which he predicted will happen sometime around or after Thanksgiving. He also estimated that it would cost $25,000 for the county to do the calculations needed for the pseudo-bills.

St. Joseph County issued such requests and was able to collect 85 percent of the amount requested, Kopp said.

But council member Michael Bucko, D-4th, relayed a concern from County Treasurer Jim Murphy that because the requests are not real tax bills, escrow holders will not make the payments. Lippens agreed, saying that the collections worked in St. Joseph County, but that some escrow holders feel they were “duped” by the fake bills and have indicated that they will only pay real tax bills.

Council member Karen Conover, R-3rd, noted that because of the county’s tax delays, several entities in Porter County have seen their bond rating go down.

In attendance Tuesday was Portage Mayor Olga Velazquez, who said it’s becoming increasingly difficult for taxing units, such as her city, to keep operating due to the delays in the tax billing. “It is getting pretty desperate in terms of just trying to make ends meet.”

Taxing units should get some relief soon, since the auditor’s office is ready to make a distribution from the recently collected ‘08 bills. The auditor’s office has about $44 million collected; Kopp said most of that will be distributed to taxing units by the end of next week.

Later in the meeting, several council members took exception to a budget memo that Kopp prepared, in which he asked county departments to trim back their 2010 proposed budgets in anticipation of 5 to 8 percent revenue reductions. Kopp said he was basing his projection on an assortment of factors, including reduced state sales taxes, fuel taxes, and income taxes.

Most county departments are funded by local property tax revenues, which will be impacted in 2010 due to the state’s property tax caps. Though it’s impossible to know precisely how the caps will cut local government revenue, one state projection put the loss at $828,000 for county government next year.

Whitten said Kopp should not have written the memo, at least not without first consulting Poparad as council president, since it is the county council, not the auditor, that makes budget policy decisions.

“This is like a slap in the face,” Whitten said.

Posted 5/27/2009