By John Reed Staff Writer
KNOX — Starke County’s leaders are blaming the state for dumping almost $900,000 of Gov. Mitch Daniels’ Major Moves money into the highway department’s MVH fund, where it was spent mostly for day-to-day operations, not for its intended purpose of road improvements.
Starke County council members, the commissioners and the county auditor talked for more than an hour Monday night about what happened to the  money.

The discussion came one week after commissioners learned only $17,000   was left in the bank and said they didn’t know what happened to the money.
"We were all under the impression we were given a gift. We thought we were going to get an extra $900,000 and we didn't," Commissioner Mark Milo said.
Auditor Michaelene Houston summarized what officials believed happened. The state auditor sent deposit slips — a standard procedure - in 2006 and 2007, showing Major Moves money being deposited in the Motor Vehicle Highway fund (MVH). That fund mostly contains gas tax money and is the basic day-to-day operating fund for the highway  department.
Then, the officials agreed, the highway department continued to pay bills and make purchases, not realizing they were using the Major Moves money. That pattern continued until earlier this month, when the county discovered only $17,000 remained.
The consensus of officials Monday night was also that the state, in delivering the Major Moves money, reduced the MVH money by a similar amount.
"The DLGF (Department of Local Government Finance) considered that as  part of the budget," Houston said.
Further, officials contend that the state deliberately reduced the MVH budget by counting Major Moves money as part of that fund.
"Was it an intentional part of their plans to use it to back up the budget? At the end of 2006 we asked (by compiling the local budget) for $1.5 million. We got $1.9 million," Smith said.
Adding the Major Moves money of roughly $440,000 totals up to about the same amount.
Milo suggested that other counties and communities may face a similar dilemma. "The clerk-treasurer of Argos wasn't aware of this," he said. Nor were three commissioners he talked to in a different county.
Commissioner Kevin Kroft said that initially everyone understood the money was special. "At first, it was basically for improving roads, equipment, those sorts of things. They (the state) didn't want it  
used for employees."
"It was quite clear everyone thought it was special," Milo said.
Some of the money was used to buy machinery (a pug mill) and trucks.  
Milo said $39,000 was used for engineering fees to improve intersections on 300 East, which serves the Knox Industrial Park. The intent, he said, was that later on the Major Moves money would be used to do the actual construction.
Smith cited the spending on machines and trucks. "We spent a helluva lot more money at the highway department the last two years than in previous years... It seems like the highway department was on every council agenda."
County departments normally only appear before the council to ask to spend money.
Smith said he intended to contact state officials and quiz them on their handling of the matter.
The county received $434,169 in 2006. In October, 2007, the county received its second and last payment of $433,399. The funds were a one-time payment to all counties and municipalities from the 75-year lease of the Indiana Toll Road.