Local government officials are sounding the alarm about spending cuts in light of the property tax caps handed down by the state this year and in each of the next two years.
But they're not crying that the sky is falling. They're warning us of a hard reality that some people don't yet appear to understand.
Combined, all Elkhart County cities, towns and taxing entities will see at least $12 million less in property taxes in 2010 than they do now, according to a local accounting firm hired by the county.
That isn't chump change. It pays for a lot of basic services that residents are used to -- garbage collection in the cities, police and fire protection, parks, schools, libraries, aid for the poor ...
Because state officials appear to believe they know how to run local government better than local elected officials, they passed a property tax relief plan in March that sounds great in an election year for them -- hold the growth in homeowners' property taxes to 1 percent of a home's assessed valuation -- while passing the buck onto local leaders to slash millions from existing and future budgets.
The problem is, especially in Elkhart County, cities and towns have already been cutting back, so there wasn't a whole lot of fat to begin with.
The cuts must come primarily from the general fund portion of budgets, the area that pays for salaries, supplies and basic services. It doesn't really account for large-scale projects, although those will certainly be affected by tax caps.
Most taxpayers may believe that big spending on the "wants" -- capital projects -- will go away or be severely cut. They may be right. But it's the unintended consequences that will hurt the most -- the potential loss those everyday services we take for granted.
And the thing that will hurt even more is that every taxing district will ultimately be impacted by all other budgets in the county. Schools will affect cities, towns will affect the county, and so on. The overall amount of property taxes sought by all the individual taxing units will be combined by the state in determining whether cap limits are exceeded.
That pits each governmental entity against the others another for scarce financial resources.
The state created this mess and is leaving it up to local governments to pick up the pieces and figure out how to make it all work -- and then, of course, to continue to provide services that residents need and want in the long-term.
It will continue to be a complicated mess.