Chesterton Tribune

 

 

County Council sets hiring freeze in funding crisis

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By JEFF SCHULTZ

The new year got off to a harsh start for the Porter County Council when it was determined that the revenue coming from the state would be less than what was expected.

The Council found its budgets already running in the red, reportedly by $2.8 million, according to an auditor with the Indiana Department of Local Government Finance. The DLGF recently released the 1782 budget notice to the County showing the deficit, which the Council members discussed during the reorganizational meeting Tuesday said would need to be paid for out of temporary reserve funds.

Council member Jim Biggs, R-1st, said the County will not be able to live on reserve funds for very long and the Council has “come to a fork in the road” with what it should do regarding personnel and get more involved in budgets than ever before.

The Council ultimately voted 7-0 to instate a “hiring freeze” where County department heads will be allowed 30 days to fill any vacant position it has funds appropriated for and no new positions are to be created. The only way someone can be hired is if a position becomes open due to a retirement, a resignation or a firing.

For any vacancies not filled, the appropriations for the salaries will be returned to the General Fund.

Council President Dan Whitten, D-At Large, told his colleagues that the one focus this year will be funding county government and that means tightening belts to the maximum.

“We are clearly facing a crisis. If everyone’s number one priority isn’t funding government, we are remiss in our duties,” he said

Council member Sylvia Graham, D-At Large, who originally suggested the hiring freeze in November, asked how the Council would go about “policing” it.

County Auditor Bob Wichlinski said that departments are to report any personnel changes on a monthly basis and he can relay that information to the Council’s budget and financial specialist Vicki Urbanik.

Council member Bob Poparad, D-At Large, asked his peers if they would have the “political wherewithal” to say no to requests for new positions. He said when businesses in the private sector have hiring freezes, they mean no new hires, but there have been many instances when Council members have said yes to new positions, especially when department heads make the requests and say the hire is essential.

Biggs said he has said no to requests earning him a reputation as a “no-jay” on the council.

Rivas suggested that new position requests should not even be heard. Council attorney Scott McClure said it is already the Council’s role to hear any new appropriation by departments.

“Any new position has to come here anyway,” McClure said.

Council Vice-president Karen Conover, R-3rd, said that just because departments have extra money to use doesn’t mean they are obligated to use it and discouraged them from spending down those amounts.

The Council unanimously agreed to the hiring freeze and will send out memos informing department heads that no new positions will be created.

“We all need to agree on the fact it’s going to be a rough year. We are going to have to be attuned to financial matters,” Whitten said.

Hospital sale investing

Meanwhile, the Council is expected to receive a financial report on Friday on what options they have for using or investing the roughly $160 million principal from the sale of the county hospital. That could shore up the revenue the County needs to fund services, while maintaining a balanced budget.

Whitten said he will invite the County Board of Commissioners to the Council’s meeting on Jan. 28 to discuss the report.

Council member Jim Polarek, R-4th, also asked if the Council will continue its ongoing discussion regarding the 10-year abatement with Porter Regional Hospital and when the abatement period is to begin. The matter will also be on the agenda for the Jan. 28 meeting and hospital officials will be invited to attend.

Budgetary obstacles

In more budget matters, Urbanik told the Tribune after the meeting her figures would indicate the numbers reported in the state’s budget notice differ from what she has and she estimates the deficit to be in the realm of $1.3 to $1.5 million, but the County would still need to come up with the funds to satisfy the reported $2.8 million deficit.

She is preparing a report for the Council members on the budget. Some reasons for the insufficient revenues may have to do with an increase in unappropriated expenditures and, among other things, several large unbudgeted funds.

But the one fact the Council should pay attention to is the effect of the property tax caps which increase the deficit more each year, Urbanik said.

Urbanik also mentioned that from her research she learned that the County departments ended up not spending down $1.9 million last year, indicating there are places in the budget that could be trimmed.

 

Posted 1/8/2014