June 06--TERRE HAUTE -- An official for Otter Creek and Nevins Townships said plans to create a new fire protection district are on hold after a state agency denied a tax levy and equipment replacement fund and said the townships failed to establish a legal fire protection territory.
The township fire departments in February held public meetings on the proposed merger, but on April 16 the Indiana Department of Local Government Finance ruled an analysis report did not meet state law requirements.
Otter Creek Trustee Robert Salmon said the DLGF has reviewed the issue twice since its April ruling at the request of two state legislators "and it appears the townships will have to consider reapplying in 2014," Salmon said.
Salmon said the idea of resubmitting an application next year has been presented to advisory boards of the Otter Creek and Nevins Township volunteer fire departments.
"It depends on the cost," Salmon said.
Otter Creek Township has already spent between $8,000 to $10,000 on the 2013 application, money the township had hoped to recoup once the proposed fire territory was established, Salmon said.
"If we decide to [resubmit an application], we would decide in the fall. We have to get our budgets put in and then make a better financial decision if it is feasible to do that or not," Salmon said. "We can maybe borrow some money out of another fund and pay it back within a year's time.
"Right now it is up in the air if we will get the fire territory and it is up in the air if we will proceed [with] the application process next year as we did this year."
The townships' analysis of the proposed fire protection territory -- prepared by Crowe Horwath, a public accounting and consulting firm with an Indianapolis office -- did not, according to the state, provide a description of planned services and staffing levels for the proposed fire protection territory and did not provide a description of any capital improvements to be provided in the proposed territory.
The report did address the territory's budget as a whole and the township's tax rates, but did not provide an initial equipment maximum tax levy, according to the DLGF.
The state agency, in its ruling, also stated the Crowe Horwath report addresses property tax rates for only 2014 and addresses effects on local option income taxes for only 2014. Each of those should have estimated effects for several years, according to the DLGF.
Because the townships did not meet those requirements, the agency ruled "no legal fire protection territory was created and thus the [DLGF] cannot approve the requested initial maximum levy and equipment replacement fund."
"The [DLGF] notes that even if the townships complied with [state law], because the townships did not adopt a rate for the equipment replacement fund, the [DLGF] would have been unable to approve the establishment of this fund. The fund is rate-driven and requires adoption of a rate pursuant to [state law]," the finance department stated in its ruling.
Messages seeking comment were left on the voicemail of Mike Harmless at Crowe Horwath. Herschel Frierson of Crowe Horwath, who was not involved with the analysis, stated he would attempt to have a company spokesman contact the Tribune-Star Wednesday afternoon. The company did not respond as of 5 p.m. Wednesday.
Salmon said Nevins Township's fire department is operating on a $25,000 per year budget, "and that is just about impossible by the time you pay insurance and the light bill and buy a gallon of diesel fuel, you have just about blown $25,000," the township trustee said.
"It comes down to whether or not if the residents of both townships will support the move and go for it," Salmon said. "It does cost money to do this and the taxpayers will have to foot the bill. We felt that it was something that was reasonable. You have people who think that it is not, but I believe that the majority of the residents thought that it was a good thing."
"I hope that it will happen some day. I don't know if it will. All I can do is work on it," Salmon said.
Salmon said he was "very disappointed" in the DLGF ruling, as Otter Creek's fire department is on schedule to make more than 600 runs this year, while Nevins will make about 125 to 150 runs. That, Salmon said, is difficult to manage with volunteer firefighters. The fire territory would allow the townships to have some full-time firefighters, plus provide medical emergency response around the clock.
"We are covering what we have to, but it would be a whole different ball game if we have the capability of having a fire territory," he said. "The service would be so much better, I believe" with a fire territory.
Reporter Howard Greninger can be reached at 812-231-4204 or [email protected].
Copyright 2013 - The Tribune-Star, Terre Haute, Ind.
