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• County Option Income Tax {COIT): These countywide taxes are allocated {net of homestead
<br />credits that are explained later) between all taxing units within the County based on the
<br />proportionate amou~rts of property tax levy for each taxing unit. Actual City receipts for
<br />2002, 2003, 2004 and 2005 were $9,531,190, $8,015,302, $7,001,198 and $5,695,618
<br />respectively. The 20()6 Budget inchxdes receipts of $5,545, 120. The actual receipts in 2002
<br />included a one time distribution of $2,409,701. This increase from the State is a "catch-up'°
<br />from prior year conservative estimates. Projected revenue streams do not include any growth
<br />rate assumptions for years beyond 2007.
<br />The City would not have supported the new County Option Income Tax if it had not been
<br />accompanied by a tandem ordinance which established an additional 6% homestead credit for
<br />property taxpayers. This additional homestead credit increased to 7% and 8% in 1999 and 2000,
<br />respectively, and then remains at 8% thereafter. Thus, as a result of the passage of this new tax,
<br />City property taxpayers were provided relief through a reduction in their property tax bills while
<br />the City was provided with an additional source of revenue that will eventually slow the growth of
<br />future property tax rate increases.
<br />Other taxes received from the State of Indiana and allocated to various fiords within the City in
<br />2006 inchxde the following: auto and commercial vehicle excise taxes ($4,113,04.2), gasoline tax
<br />($4,522,636), cigarette tax ($477,506), financial institutions tax {$154,379), alcohol
<br />gallonage/state liquor excise taxes {$316,656) and gaming proceeds revenue ($679,690). In the
<br />State budget, adopted by the General Assembly, little additional funds have been available for
<br />Local Roads & Street Funds for both the City and County. Therefore, in 20{}3 the County
<br />adopted a local wheel tax which is based upon vehicle registration. The dollars allocated to the
<br />City, $1,925,000 budgeted in 2006, will be used to repair and resurface City roads to keep them
<br />at appropriate levels, The remaining taxes listed above are not anticipated to change significantly
<br />over the next several years. However, the 5t. Joseph County Council has voted to rescind the
<br />wheel tax in anticipation of receiving a State distnbution related to the lease of Indiana's only tall
<br />road. South Bend expects to receive a one•-time distn"bution of $12.5 million in Qctober 2006 for
<br />the construction of roads and economic development projects. The County Council's action was
<br />vetoed by the St. Joseph County Commissioners and it is uncertain at this tune whether or not the
<br />wheel tax will be permanently rescinded The 2006 anticipated levels reflect modest increases
<br />from the prior year and follow general guidelines provided by the State of Indiana. One additional
<br />tax included in this category is the County's Hotel /Motel Tax, which is budgeted ax $1,851,027
<br />for 2006. This tax, which represents a portion ofthe 6% tax assessed against hotel and motel
<br />billings within the County, is projected to grow at a modest 2 to 3% per year. The City's portion
<br />of the Hotel l Motel Tax is utilized to support operational costs for the Century Center and
<br />marketing costs for the College Football Hall of Fame.
<br />Another significant source of revenue is fees received from rate payers for services provided for
<br />water, sewer and solid waste pick up. The $34.4 mullion anticipated revenue for 2006 breaks
<br />down as follows: $15,396,505 for Sewage Works, $14,344,217 for Water Works, $4,045,134 for
<br />the Solid Waste Removal and Recycling Program, $1,487,000 for the Water and Sewer Insurance
<br />Programs and the remaining $154,440 for Project Releaf {a program providing leafpick-up
<br />throughout the City). Revenue collected from rate payers is generally determined by either a flat
<br />fee charged per month for the service provided (Solid Waste, Releaf Program and Water/Sewer
<br />Insurance) or by multiplying the vohune of services utilized by the current utility rate {water and
<br />~e)-
<br />The City is not anticipating any significant increase in volume of services provided by the utilities
<br />13-6
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