Chesterton Tribune

 
 

County Council splits to freeze budgets; Whitten walks out over cuts

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 By JEFF SCHULTZ

Once again, the Porter County Council has successfully balanced its budgets going into next year without making personnel cuts or raising taxes.

Successful yes, but only to a degree. Monday’s final budget approval meeting left the Council divided and a lot more questions unanswered than answered. Arguments ensued among the Council members and the Commissioners over how to use the county’s economic development income tax (CEDIT) to shore up needed funds for County general operations when the state’s tax cap and refunds on appeals are cutting $2 million out of the property tax levy used for the County’s General Fund.

The question of using CEDIT and reserve money for long-term funding and employee raises resulted in two equally split votes 4-3, the prevailing one was to adopt a General Fund budget of $37,997,146, the amount as it had been advertised along with an employee salary ordinance identical to what was adopted last year with the exception of any state mandated raises.

With revenues projected at $37.5 million for the General Fund, the approximate $500,000 difference would be made up from reserve money already contained in the fund from year’s past.

Voting “yea” to keeping the budgets as they stood were Jim Biggs, R-1st, Jeremy Rivas, D-2nd, Jim Polarek, R-4th, and Sylvia Graham, D-at large. Council members voting “nay” were President Dan Whitten, D-at large, Laura Blaney, D-at large, and Karen Conover, R-3rd.

Evans’ plan

Two separate funding strategies were debated. First, from the floor Commissioner President John Evans, R-North, said that he would beef up the $2 million in unallocated CEDIT he offered to give in late August to cover the $1.9 million loss for the General Fund to $2.5 million for miscellaneous use.

With an additional $2.46 million in previous cuts to budget, Evans said his proposition would have endowed the General Fund with a $4.2 million reserve amount that could be used to open the third pod at the jail if necessary and a “modest” $500 across-the-board raise to County employees who have not seen a raise in at least three years.

The $2.5 million largesse would be contingent upon the Council’s agreement for the increased salaries and approval to spend $1.65 million of $12 million available in hospital sale interest money to fund the requests from social-service-agencies Opportunity Enterprises, Family and Youth Services Bureau, the Council on Aging and Porter-Starke Services similar to last year.

Evans said the plan, which he worked on with Blaney, Whitten and Conover, would build up additional funds for more challenges like the health insurance cost containment, drainage projects, E-911 funding, outsourcing Animal Shelter operations and an economic development plan.

“This is what the people of Porter County expect of us,” Evans said.

He added that none of the Commissioners would vote to use any of the $163 million in hospital proceed money to balance budgets; nor would they increase property or income taxes.

“To imply the County is bankrupt is totally ridiculous. With our cash reserves, Porter County could continue its operations for nearly five years without collecting one cent of property taxes,” he said.

Whitten on behalf of the council said his board would not make any vote to increase income taxes either, even when other counties nearby have been increasing theirs by as much as 10 percent and suggested three reasons why finding a way to shift available CEDIT is critical – it prevents cutting services, doesn’t raise taxes and permits hospital interest money to be used for social services.

“Any plan we see has to rely on CEDIT,” Whitten said.

Evans said his board would write four-year plans for CEDIT funding to work with the Council’s request for miscellaneous revenue.

Uncertainty over CEDIT

Meanwhile, Biggs segued the discussion saying that although he believes every County official is working toward the same goal of becoming less reliant on property taxes, he is one who is not comfortable using non-permanent funds like the hospital interest money. He, Rivas, Polarek, and Graham did not believe the $2.5 million for CEDIT items were adequate to address challenges like the jail staffing and operating E-911. “We simply cannot balance budget on reserve funds because they are not stable funds,” Biggs said.

County Departments must also learn how to become “leaner and smarter,” he added.

Evans said he believes the County’s assessed value will increase next year with the economy bouncing back and the Jobs Cabinet will execute a plan to bring more commercial and industrial development to the county. Whitten too felt optimistic and said more money would be available if the County would avoid imposing tax increment finance (TIF) districts.

Others like Graham, Biggs and Rivas were not so sure as consultants Umbaugh & Associates had advised AVs will continue to decrease steadily as the tax rates get closer to the circuit breakers.

Different numbers

Meanwhile, tensions were heating up as the two sides questioned how their General Fund plans ended up with different numbers.

The $37.9 million proposal was constructed with the help of County Auditor Bob Wichlinski while the other was made with Bob Clifford of Umbaugh & Associates advising.

Clifford, who was present at the meeting, said he used a Gateway software system to figure his numbers that had not contained the latest figures from the auditor’s office and the numbers were not updated until this weekend after Evans already drafted his proposal.

Clifford last week had estimated revenues at $33.4 million for the General Fund while the auditor’s budget analysis indicated the county could levy $37.5 million.

Polarek, Biggs, Rivas and Graham said they did not see the Evans’ proposal until Monday afternoon when an e-mail was sent two hours before the meeting. Polarek criticized Evans and others who worked on the proposal for using a consultant to come up with budgets when they could go to the auditor’s office to get firsthand knowledge.

Whitten walks

But the breaking point of the meeting came after the split votes were taken. The line item for Veteran Services in the approved budget saw a decrease of $6,000 to $90,000 which caused Whitten to blow his top.

He scolded his peers for taking such an action which he said was disrespectful to Porter County’s veteran population, himself included.

“I’m a veteran. I fought for this country! And I am offended at what you did tonight!” Whitten exclaimed, storming out of the meeting.

Immediately after he left, Polarek made the motion to restore the $6,000 which was approved unanimously by the remaining Council members.

The Council forged ahead and unanimously approved the other budgets that were not part of the General Fund.

In another action, the Council ended up tapping about $300,000 of the hospital sale interest money to give to social service agencies as was done last year.

PCACS will get $120,000, Opportunity Enterprises will get $50,000, and Family and Youth Services Bureau will get $100,000 from the interest fund.

Reactions

Although many department heads in the audience seemed upset at the vote to flatline budgets next year, the four Council members remained confident that their decision best suited the demands of county residents.

“The reason why we are such a good county is because we are responsible,” Graham said.

Biggs said he felt the push for raises out of reserve funds was “silly” and an election year antic considering the proposal didn’t take into account how to fund medical staffing for the jail.

Blaney said she feels the Council dwells too often on the negative “what ifs” and it’s frustrating when trying to help county departments make progress.

“I’m disappointed. A lot of people got screwed over and it wasn’t necessary,” said Blaney.

Evans said he is “truly embarrassed for the County” for not being able to reward its employees for their hard work when the county is sitting on over $170 million in reserve funds.

Challenges still remain but it will take willingness on the part of the Council to collaborate with the Commissioners, since they are the ones who make CEDIT plans, Evans said.

 

 

Posted 10/16/2012