Chesterton Tribune


Town Council asks Utility for $400,000 loan

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The Chesterton Town Council is looking to the Utility for a loan of $400,000, to make good on a shortfall in this year’s General Fund and Motor Vehicle Highway (MVH) fund.

At a special meeting Tuesday night, members formally voted unanimously to ask the Utility Service Board to make that no-interest loan, which would have to be repaid next year no more than 30 days after the final 2013 property-tax draw.

That $400,000 shortfall is chiefly the result of cuts made earlier this year by the Indiana Department of Local Government Finance (DLGF) to the town’s 2012 budget. Some of those cuts were routine, as DLGF typically slashes a municipality’s advertised budget.

But DLGF this year cut around $350,000 from the 2012 advertised General Fund (used to pay employee wages and salaries and to cover daily operations) and another $193,00 from MVH (the Street Department’s main budget).

The cause for those Draconian cuts appears to be the fact that the Clerk-Treasurer’s Office missed the deadline in the fall of 2011 by which, under Indiana Code, municipalities are required to publish their advertised budgets.

In any case, when the dust had settled, the town found itself around $400,000 in the hole.

Initially, Clerk-Treasurer Gayle Polakowski believed that the shortfall could be covered by a loan from the Cumulative Sewer fund, but that would need to be repaid by the end of the year. Polakowski is also expecting a number of large reimbursements from health insurance claims made this year; it’s unclear, however, when exactly those reimbursements will be made.

So the council is hopeful of getting a loan from the Utility, for which there is past precedent.

Town Attorney Chuck Lukmann told the Chesterton Tribune after Tuesday’s special meeting that he anticipates the large gaps made by DLGF in this year’s budget to be re-filled by DLGF in next year’s. At any rate, Lukmann hopes they will be, since otherwise the town will find itself in largely the same position this time in 2013.


Posted 11/15/2012