Chrysler's Unpaid Bills Threaten Kokomo Services

KOKOMO, Ind. -- City leaders in Kokomo are scrambling to make cuts after Chrysler's bankruptcy left a multi-million dollar tax bill unpaid.

The city stands to lose $5.9 million if the automaker won't pay up on its property tax bill, 6News' Norman Cox reported.

Chrysler is supposed to pay local governments and schools $8.3 million every six months, but has only paid $2.2 million this year, covering what's owed for its buildings. That doesn't include the bulk of the tax, which is owed on its equipment.

But officials with the new Chrysler said that's money owed by the old Chrysler, which is still bankrupt.

City Controller Jim Brannon said Kokomo is at a true loss.

"This has a devastating effect on the city of Kokomo," he said. "We can quit paving streets. We can quit picking up trash. But that's still not even going to get it."

So far, both Sen. Dick Lugar and Sen. Evan Bayh, along with two Indiana congressmen, have appealed to President Barack Obama's auto czar Steven Rattner.

Kokomo Mayor Greg Goodnight, who is in Italy visiting Chrysler's new owners, Fiat, said he's grateful for the congressional help.

"We've been in contact the last two to three weeks beginning with possibility and now the very real reality that we might not receive those payments," he said via satellite.

Goodnight said he is at least getting positive feedback from Fiat officials about the future of Kokomo's Chrysler plants, with the indication that all four will remain open.