The impact of state finances on local governments was detailed for Marion Chamber of Commerce members Friday at their monthly luncheon meeting.
Marion City Administrator Roger Holter and County Commission Chairman Dan Holub took turns describing how state-to-local funding was designed to work, and contrasted that against current barriers that have left cities and counties scrambling to operate with less.
Holub said the state legislature has virtually ignored some laws intended to return tax dollars to local governments.
“Statutorily established taxes for specific purposes, and they’re bypassing the system,” Holub said. “Not a dime has been provided out of these funds since 2003. Since 1991, the state has kept back about $2.3 billion from cities and counties, most of that since 2003.”
Holub wants to see the payments restarted, but said he doesn’t expect to recoup what’s been lost.
“Our chances of ever seeing those funds is nil with the budget they have now,” Holub said. “They’re not going to be paying their bills. Every time they don’t make those payments, it’s costing us. This is a local crisis.”
The recent downgrade of the state’s credit rating is negatively affecting cities that want to issue bonds to finance large projects.
“We’re looking at an infrastructure project in 2016,” Holter said. “Right now if we go out to sell the bonds, instead of getting them at 2 percent for the citizens, the best quote I can find is 4.14. It’s double the rate. It’s guilt by association — we’re a Kansas municipality, and it’s tied to the state.”
Restricted funding could lead to rethinking how various government services are provided in the county, Holter said.
“We know the money’s not coming, so we’ve got to start looking at duplication,” he said. “We have 14 fire departments operating in our county. We have five school districts, and we have 11 municipalities trying to provide the same services. We have two municipal power companies and five private ones operating in Marion County. This is not for today, but we’re looking for ideas from you all. We’re just throwing out some thoughts for the future.”
Holter and Holub both emphasized that with the legislature still in session, Chamber members should make their concerns known to their representatives.