Council President Dan Whitten, D-At Large, laid out the task at hand for his
colleagues Š find a way to get around the $5 million deficit they are
heading toward this year.
And, while they are
at it, try to come up with a plan to curtail the $8 million deficit facing
them in 2015.
“We’re in the red,”
Whitten said. “The days of hoarding funds under mattresses are over. We have
to find a way to move forward.”
The Council learned
from the state at the beginning of this year that the budget they approved
for 2014 has a deficit of $2.8 million.
On top of that,
Whitten said the County needs to come up with another $2.5 million in 2014
to catch up with employee health insurance costs.
For next year, the
County needs to close a deficit at the Enhanced 911 Center and find another
$2 million to cover declining revenues due to property tax caps.
What could be
worse, Whitten said, is potentially an additional $2.25 million lost if
Governor Mike Pence’s elimination of the business personal property tax is
“That would be
devastating for us,” he said.
Whitten pointed out
the County used over $2 million from the hospital interest funds this year
to pay subsidies to social services and E-911 which are usually paid out of
the general fund budget. Around $7.9 million remains in the interest fund,
he said, and that may be needed to keep the County’s operating fund solvent.
The same goes for
county income tax funds, Whitten said, of which the Council has appropriated
more than $2 million made available by the County Commissioners to aid E-911
and the jail’s new medical service contract.
“We’re still stuck
with that hole we have to plug for next year,” said Whitten, who also spoke
out against using TIF areas to divert property tax money from the general
Council member Jim
Biggs, R-1st, said he appreciates Whitten taking the initiative as he has
frequently tried to draw attention to the County’s “bleak” financial
“I applaud your
homework, Dan. It’s long overdue,” said Biggs.
The Council took a
step in trying to ward off the governor’s tax cut by passing a resolution
voicing its opposition.
Judging that an
annual loss of $2.25 million would cripple the County’s ability to provide
services to its citizens, and that the tax burden would shift from
businesses to residents, the Council made three requests: that the governor
reconsider his proposal to phase out the personal property tax, that the
Indiana Assembly reject the tax cut, or that if a phase out is implemented
then a sufficient method of replacing lost revenues be made with it.
Agreeing with the
resolution were all seven members of the Council.
Scott McClure said a Porter County would take a 13 percent hit on the whole,
or $25 million total, including municipalities and the county.
Other public boards
in the county, including the Duneland School Board, have passed similar
One action the
County “absolutely 100 percent has to do” to get control of its budgets is
to take a portion of the $159 million Porter Memorial Hospital sale proceeds
and place it into a charitable endowment fund, Whitten said.
said last week they received a proposal from the Porter County Community
Foundation for a guaranteed annual return on investment of five percent,
much higher than what County Government sees from its investments in U.S.
Treasury bonds, and called upon the Council to schedule a joint meeting for
Getting all seven
Council members and three Commissioners was not possible in February due to
scheduling conflicts, but the Council did tentatively schedule the meeting
for March 12 at 5 p.m. Unanimous support is needed from both boards in order
to access or invest the sale proceeds under an internal rule agreed to by
the Council and Commissioners and in Porter County Code.
Also attending that
meeting will be the representatives of the County Community Foundation and
the Hall Render law firm, which recently delivered a report on what
investment options the County had in regards to hospital sale proceeds.
concludes that the County has three preferred options to gain a higher yield
of interest Š creating a new foundation and transferring proceeds into that
foundation to be controlled by the Council members; transferring the
proceeds to the existing Porter County Community Foundation under contract
agreement; or directly investing the funds in Indiana municipal securities.
Adams, R-Center, last week said if $100 million is invested $5 million in
returns from the endowment could go to the general fund, more than $400,000
clearly dictate we do this, the sooner the better,” Biggs said.
member Jeremy Rivas, D-2nd, inquired when the discussion of Porter Regional
Hospital’s property tax abatement could take place, as it was originally
planned to be discussed Tuesday.
McClure said he and
the County Auditor’s attorney are still gathering information from the
hospital. He expects the matter will be ready for discussion by the
Council’s next regular meeting in February.
Whitten said he
preferred to wait until all the information is at the Council’s disposal.
“I don’t want to
hear a lot of ‘I don’t know’ and ‘we’re still working on that,’ I want
direct, forward answers,” he said.
Council member Jim
Polarek, R-4th, asked that the hospital report on how many new employees it
has hired as it was a criteria of the ten-year abatement. McClure advised
that the response to that question “won’t be simple as that” as the answer
has “many layers.”
More ways to save
Whitten said he is
hopeful the County will find solutions to its current budget hurdles, but it
may require some difficult cuts from within.
revenue and continuing to make leaner budgets are the two most pressing
matters the Council is facing, Whitten said. That may mean cuts to personnel
in some departments, he added.
“They will need to
cut or we will do the cutting for them,” he said.
Polarek said the
Council during the recent budget session cut wherever they could in the
budgets and the only place left to cut from would be personnel.
member Karen Conover, R-3rd, said a letter should be sent out asking
department heads to only use whatever is essential in their budget.
“Just because you
have your funds appropriated doesn’t mean you should use them,” she said.
Whitten also called
on the Commissioners to attend Council meetings so they can be part of the