Burns Harbor Councilman Mike Perrine’s frustration was evident Wednesday as he invited residents to attend a 1:30 p.m. Monday workshop on the 2011 budget and see just how bad town finances really are.

He warned that if state officials don’t allow Burns Harbor to raise more money --- or if new local user fees aren’t imposed on residents --- layoffs and service cuts may be needed similar to the town’s austerity moves in 2001 when Bethlehem Steel, the town’s largest taxpayer, went bankrupt.

Perrine said the severe budget cuts made at that time are penalizing the town now because Indiana freezes the amount of property taxes a government unit can raise, allowing only a small percentage increase each year. For this reason Perrine said Burns Harbor’s budget is lower now than it would have been had the drastic cuts not been made.

At the time of the bankrupty, however, there were real fears whether the town could continue to operate at all had not deep cuts been made and volunteers stepped up to help.

The council plans to review department requests for 2011 at Monday’s meeting but Perrine said it could be a waste of time if there’s no new money to be found. Unlike other towns, Burns Harbor doesn’t assess user fees for street lights, fire-hydrant rental, recycling and garbage collection to supplement its budget, but Perrine said one or more may have to be considered next year.

Clerk-treasurer Jane Jordan said the town could appeal for an excess levy to raise more in property taxes because of its documented growth. Early indications are only a 2.9 percent increase in tax collections will be allowed by the state next year, she added, and even less in 2012.

Perrine said it’s ironic to have Bethlehem’s assessed-valuation-heavy steelmaking successor, Arcelor Mittal, located in town yet Burns Harbor is struggling for money. He speculated it may take special legislation in the Indiana General Assembly to restore the town’s tax levy to a level where it would have been had it not been slashed in 2001.

First, said Perrine, Burns Harbor needs to document its near-term and long-term needs including employees and services to convince legislators the town’s budget problems will only get worse, especially because special funds tapped to cover shortfalls are now running dry and the cost of gasoline, utilities and insurance continues to rise.

Perrine originally suggested having a special meeting for residents and business owners to lay out the budget facts, but the council invited them instead to the budget workshop. Citizens had been invited to attend a Tuesday town hall meeting to make suggestions for needed capital improvements but Hesham Khalil of town engineer Global Engineering and Land Surveying, which is in charge of developing a prioritized list, said no one showed up.

The council set another public open house for July 21 at 7 p.m. to discuss a five-year capital improvement plan; residents are encouraged to attend and participate. Last night resident Gayle Van Loon said in light of Perrine’s comments, developing a wish list seems kind of ridiculous. Council member Toni Biancardi said the town missed out on applying for federal stimulus money because it had no plan with projects in place and doesn’t want to lose out again on those or other grants.

Perrine said wish lists are not a bad thing but you have to watch what you wish for; he made those comments as the council considered adopting a memorandum of understanding with the National Park Service, the city of Portage and town of Ogden Dunes regarding future construction of a Marquette Greenway Trail spanning those jurisdictions including Burns Harbor.

Perrine’s concern has been that if the town builds a trail, there’s no money or manpower to maintain it and a local cash match might be needed for construction.

Town attorney Bob Welsh said he revised the proposed MOU to sound less like a binding financial contract and more like a statement of intention by the participating agencies to work together and seek grants for trail construction without obligation.

Councilman Cliff Fleming pointed to the town of Porter for successfully leveraging grants to finance its Gateway to the Indiana Dunes initiative that promises to build stylish bridges, create jobs and bring tourists into the local communities.

Last year Burns Harbor spent $50,000 to have a consultant do a trail feasibility study. Fleming suggested approving the MOU and if it needs to be tweaked later, it could. Biancardi said she just received the document last night and wanted to study it. Perrine observed the MOU provides a way for Burns Harbor to withdraw in the future if necessary. Vote was 3-0 to approve with council members Jim McGee and Louis Bain absent.

As the council meeting neared the 2 1/2-hour mark, Van Loon suggested the council meet twice a month instead of only once so documents can be fully read and reviewed. “It’d be nice so you don’t have to pass things urgently like you did.”

Prior to the Bethlehem bankruptcy the council did meet twice monthly but stopped to save money on professional fees. Biancardi and Perrine said they’d like to see two meetings return. Biancardi, who chaired the meeting in McGee’s absence, said the council would have a better chance of having more members attend at least one of the meetings and she asked the topic be placed on the next council agenda.

Biancardi reported Bain advised that he is working on specifications to solicit proposals for garbage collection next year.

Instead of having too little money, Jordan said the town temporarily has too much.

She said in a typical year Burns Harbor’s tax-increment financing or TIF district generates about $300,000 to $325,000 in property taxes with half distributed in the spring and half at year’s end. But Jordan said June 25 the town received a check from the Porter County Auditor’s Office for $504,115. She is awaiting notice how much of the money to return.

The town rummage sale is set for Saturday and Sunday from 8 a.m. to 3 p.m. Several homes in various neighborhoods including a booth at the fire station will participate. Also, Jordan said the third of four contracted mosquito foggings will take place this week on the north end of town.

Posted 7/15/2010