KOKOMO - Negotiations to raise Howard County’s innkeeper’s tax have hit a snag as local officials in recent days have sparred over various aspects of the potential legislation.
Officials from Kokomo and Howard County governments have differed in their opinions about whether the county council should have the ability to approve capital improvement expenditures from the Kokomo/Howard County Convention and Visitors Bureau, which receives innkeeper’s tax funding.
Some argue that the county council, as the body that would approve a tax increase, should have the power to appropriate capital improvement project spending related to the tax increase.
Such spending could include projects like a new convention center, which has been discussed as a motivating factor behind the potential tax raise.
Others, however, say the county council shouldn’t be able to make decisions on projects that have been headed by city officials and are likely to be developed within city limits.
Controversy has also surrounded a $275,000 sum that is appropriated annually into the CVB budget, and how to handle such funding in future years.
Public discussion about an innkeeper’s tax raise kicked off on Dec. 7 when the county council consented to, and expressed favorability for, the filing of a preliminary, redlined bill. That bill has since been updated by county officials.
State Rep. Mike Karickhoff, R-Kokomo, had previously asked local officials to express agreement on the specifics of an increase that could raise the tax from 5 to no more than 8 percent.
Karickhoff said he’s been asked to carry enabling legislation that would allow the county to raise the innkeeper’s tax. The county cannot adopt the tax increase unless the Indiana General Assembly first passes a special Howard County innkeeper’s tax statute.
Karickhoff wants to see a consensus from the Howard County Council, county commissioners, Kokomo Common Council, Kokomo Mayor Greg Goodnight and the CVB.
As part of the council’s motion, which was approved by a unanimous vote, members requested that the bill include a passage that allows the council to approve a specific capital improvement project from the CVB, like a convention center.
A public dispute over the innkeeper’s tax then began in an informational session before the Dec. 19 Kokomo Common Council meeting, during which city controller Randy Morris read a statement specifically criticizing Howard County Attorney Larry Murrell and the process of coming to a local consensus.
Morris said that on Dec. 5 officials from the city, county, CVB and the Greater Kokomo Economic Development Alliance met to discuss the proposed, preliminary legislation.
At the meeting - which included Morris, Kokomo Mayor Greg Goodnight, Howard County Councilman Stan Ortman, Howard County Commissioner Paul Wyman, CVB President Kirk Daniels, GKEDA President Charlie Sparks, Kokomo corporation counsel Beth Garrison and other GKEDA and CVB members – Morris said unanimous support for a preliminary draft was reached, one that excluded language allowing the county council to approve specific capital improvement projects.
Murrell was not present.
Morris then noted that on Dec. 7 the county council adopted a resolution supporting language different than what was agreed upon. Morris went on to criticize Murrell for canceling a later meeting and not providing a rough draft of the county’s proposed changed until 30 minutes before another.
“Given the county’s conflicting actions, repeated cancellations and changed opinions, we request that the resolution to support this proposed legislation be tabled until a final draft is circulated an agreed upon by all parties,” read Morris.
In an interview, Goodnight further criticized the county for backing off its initial agreement at the Dec. 7 council meeting, and again updating the legislation on Dec. 20.
The updated legislation has not been finalized, but includes language about the annual $275,000 appropriation and gives the county council the right to approve capital improvement projects related to the tax increase.
Goodnight referred to the innkeeper’s tax controversy as “work release déjà vu” in reference to the county council voting down a work release facility in July before approving it in November.
“The part that drives me crazy about what they’re proposing now is this is in conflict with their own resolution that they’ve already voted on. This is number three,” he said.
“They keep moving the football, and we keep going to try to kick it and keep landing on our back,” he added later.
Goodnight, who said the city would at some point support a form of innkeeper’s tax legislation, later referenced what he sees as a power grab by some in county government.
“There are people in county government, and I won’t name and it’s not all people in county government, but there are people that want control of things but no responsibility or accountability,” he said. “But they want the control, and we all witnessed it with work release.”
In a statement Saturday, Goodnight added: "The only reason any of this conversation is possible is because, while under the careful watch and control of city appointees, the CVB tripled their cash balance in just four years and rooted out theft and fraud that went undetected by the county for years. The current CVB board has proven they are the perfect group to watch over taxpayer dollars."
In relation to Morris’ comments, Murrell sent a response on behalf of the county working group, saying in part that there “are numerous inaccuracies in Mr. Morris’ unfortunate statement.”
“However, rather than engage in bickering over process, the County would prefer to focus on accommodating the Alliance’s goal to increase the innkeeper’s tax to [8 percent],” read the county statement, which thanked Karickhoff for his efforts.
“To that end, the county council and commissioners fully endorse the [Dec. 20] draft of Rep. Karickhoff’s propose bill prepared by the [Legislating Service Agency]. We appreciate how this bill provides transparency for the taxpayers and provides accountability as to how this increased tax revenue will be spent.”
Wyman issued a similar statement following Morris’ remarks.
“I believe any final innkeeper’s tax legislation should ensure transparency and accountability as to how tax dollars are spent,” said Wyman in a statement. “The taxpayers should have confidence in a process that results in good government. The most recent [Dec. 20] draft of the legislation provides for that.”
In an interview Friday, Karickhoff, noting that he’s handing the issue with a hands-off approach, said he’s confident an agreement on the tax increase will be reached by local parties.
He added, however, that if an agreement is not reached, he will not file a bill at the Statehouse. The deadline for filing House bills is Jan. 10, according to the General Assembly’s online calendar.
“From the very beginning, I’ve said I want these parties to come to an agreement on advancing the way we collect our innkeeper’s tax, and I’m confident that they will come up with what’s best for our community to move forward,” he said.