The Chesterton Utility is projecting a maximum deficit next year of around $148,000 and a minimum one of around $63,000.

That, according to the 2013 budget which the Utility Service Board formally adopted at its meeting Monday.

In the end the deficit—if deficit there will be—depends on the rate of revenue growth. A rate of 0 percent would yield estimated total operating revenues of $2,206,168, against estimated total expenses of $2,352,687, for a deficit of $147,519.

A growth rate of 2.4 percent would yield estimated operating revenues of $2,290,186, against—again—estimated expenses of $2,352,687, for a deficit of $62,499.

The vote to adopt the 2012 was not, however, unanimous. Member John Schnadenberg voted against it, on the ground that Superintendent Rob Lovell increased the line item for total salaries and wages by $36,000, at a time when no other municipal employees are getting raises.

Lovell, for his part, said that the increase in the line item may be needed to hire a properly certified utility operator next year, to replace an employee expected to retire.

In other business, members voted 4-0 to approve a loan of $400,000 to the Town of Chesterton, as requested last week by the Town Council. Member Jim Raffin was not in attendance.

The purpose of the loan: to make good on a shortfall in this year’s General Fund and Motor Vehicle Highway (MVH) fund.

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, but others were Draconian, the latter apparently because 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.

About six years ago the Utility made a similar loan to the town, so there is precedent for the move, Associate Town Attorney Chuck Parkinson noted on Monday. Under state law, the town must re-pay the Utility no later than 30 days after the final 2013 property-tax draw.

Also under state law, the Utility may only make the loan if it has at least $400,000 in cash reserves over and above its anticipated needs and expenses. It does have those reserves, Parkinson said.

President Larry Brandt did emphasize that “in no way does the loan to the town impact the rate increase” of 6 percent which the council enacted earlier this month at the Service Board’s recommendation. That rate increase is intended solely to finance the $15 million which it will cost to implement the federally mandated long term control plan to reduce combined sewer overflows.

“It’s an entirely different issue,” Brandt said. “The loan has no impact on the rate increase whatsoever.”

Meanwhile, members voted 4-0 formally to nominate Lovell to be the signatory for the Utility’s application to the State Revolving Fund (SRF) for a loan to finance the cost of the long term control plan, then 4-0 to adopt the preliminary engineering report for that plan as part of its application to the SRF.

At its October meeting, the Service Board held a public hearing on the preliminary engineering report: one person spoke in favor of it, no one in opposition to it.

Members also voted 4-0 to name Deb Schoenfelt its new secretary, with long-time secretary Donna Simmers’ resignation this month.

Members bid adieu to Simmers and welcomed aboard Schoenfelt.

The operations report for October was not immediately available, as a new software system is currently being installed at the Utility.

Posted 11/20/2012