The BMV said in September it would refund $29 million to state residents after it improperly classified vehicles during registration and then overcharged on fees.
The reimbursement comes after the BMV last year refunded another $30 million for a similar miscalculation.
Indiana counties, cities, schools and townships are now set to feel the sting from the error.
The state last week released the amount of excise tax dollars it would be holding back from each county to make up for the overcharging and subsequent refunds on registration fees.
Excise taxes are charged through the BMV during vehicle registration. The state distributes the tax to counties, which then divides up the money among all the taxing units in the county twice a year.
With the BMV shelling out nearly $60 million in unanticipated payments, counties are now set to lose in total $19.2 million over a two-year period starting June 2015.
Howard County’s loss will total $371,000. Auditor Martha Lake said the county currently distributes in total $6.5 million in excise tax a year to the townships, schools, cities and towns in the county.
“It won’t be a big loss, but it will be big enough where the taxing units will notice it,” she said. “Any time there’s any kind of shortage, it’s a hindrance. Due to the overall tax cuts, it creates a little more tension.”
Lake said the county is set to lose another $570,000 in excise tax this year because the BMV failed to distribute the money on time, and the county won’t have it by the time the money is distributed to the taxing units.
“Everybody makes mistakes, but we hate when mistakes happen,” she said. “I feel bad for them and I feel bad for us, but we’ll work through it together. We’re hopeful that we won’t have any more errors like this.”
Miami County is set to lose $73,400. Auditor Jane Lilley said the reduced tax revenue will be especially painful for the county, which last month eliminated 10 full-time employees as part of an effort to cut $1.5 million from its budget.
“It’s hard to except the fact that the BMV overcharged people and we have to make up the difference, especially at a time when every penny is pretty crucial,” she said.
Miami County Treasurer Becky Morris said even though the county receives in total around $1.9 million in excise tax a year, the smaller distribution next year will have a real impact on the county, its towns and schools.
“With money getting tighter and tighter, every little bit makes a big difference,” she said.