Chrysler sticks it to Kokomo

August 21, 2009
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Officials in Kokomo and Howard County are in a tough spot. The “new” Chrysler created after its bankruptcy sale to Fiat contends it‘s no longer on the hook for $12.9 million it owes various local taxing bodies this year and $12.3 million it will owe next year.

The taxes are on equipment in the factories its runs in Kokomo. The new company is paying its real estate taxes. Yet, it also is asking that the assessed value of two plants in Kokomo be cut roughly in half, to $55 million.

Chrysler officials have stopped corresponding with local officials, according to the Kokomo Tribune, which is tracking the unfolding mess.

Huge money is at stake for the county. Kokomo would be a Chrysler colony were it not for also hosting a sizeable Delphi electronics complex, which has had its own struggles. Imagine if dozens of Eli Lillys unloaded tax obligations all at once in Indianapolis.

This comes at a delicate time for Howard County. Fiat is scrutinizing Chrysler operations to find places to cut costs. So the last thing local officials want to do is make the new owners mad.

Yet, government needs money. Badly.

If you were the officials, what would you do?

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