DLGF Commissioner on changes in Budget

The Indiana General Assembly did pass a two year budget late last nite, and it was signed by Governor Daniels. This letter was sent this morning by Timothy Rushenberg, commissioner of the Indiana Department of Government Finance. Please call us today for assistance in planning your municipal budgets this year: 219-736-1800

All,

The State’s budget bill has passed both the House and the Senate and is on its way to the Governor’s desk for signing. Effective July 1, 2009, HB 1001(ss) includes the provision to move the unit budget adoption deadline from September 30 to November 1. Also, the bill moves the proposed budget advertisement (Budget Form 3) deadline to September 2 and September 9 rather than August 2 and August 9. A flow chart outlining the budget adoption process and deadlines for cities, towns and townships has been attached.

Other changes effective July 1, 2009 include:

The move to fiscal schools has been delayed until 2011. This means that beginning in 2011, each school corporation shall adopt a budget that applies from July 1 of the year through June 30 of the following year.

The “1782 Notice” period has been changed from 14 calendar days to 10 calendar days.

The Local Government Property Tax Control Board and School Property Tax Control Board have been repealed. All issues previously reviewed by the Control Boards will come directly to the Commissioner of the Department of Local Government Finance.

Political subdivisions with controlled projects subject to a referendum vote will need to provide project information to the DLGF for posting to the DLGF Web site.

We will soon be issuing more thorough guidance, but felt it important to provide notification of these important issues now. If you have specific questions you would like addressed, please send them to me and we will ensure they are answered in the guidance.

Very Respectfully,

Timothy J. Rushenberg

Commissioner

Indiana Department of Local Government Finance

Cender and Company in the news

As the distressed unit board in Indiana continues it's review of the City of Gary and entities affiliated with Gary, we were mentioned in recent news. We do not advocate for any specific position with regards to the analysis we were asked to undertake, as the State's Distressed Unit Board asked, we complied.

A plan to eliminate the Gary Sanitary District's property tax revenue and run the agency strictly on user fees is among the records under review by a state tax appeals board.

If implemented, the plan shows, GSD's property tax levies would be eliminated but its customers' user and trash collection fees would rise once again.

The analysis, prepared by GSD financial adviser Cender & Co., was requested in a letter in January by Cristopher R. Johnston of the state Office of Management and Budget.

Johnston sent his letter to Gary controller Celita Green after the Indiana Distressed Unit Appeals Board toured the city.

GSD faces a possible $4 million deficit this year, a state report shows, because of new property tax caps. GSD, the city of Gary and several other Gary taxing units are asking the distressed board to raise those caps for local businesses to make up for the deficit.

According to Cender & Co.'s analysis, GSD would need to increase monthly user fees from $6.50 per 1,000 gallons to $8.06 per 1,000 gallons if the sewer operating property tax levy was eliminated.

If the sewer operating and debt service property tax levies were eliminated, GSD would need to increase that fee to $8.85 per 1,000 gallons.

An 85 percent user fee increase was implemented at the district in June 2008. GSD also started charging customers a trash collection fee for the first time this year after Gary privatized its trash service.

That monthly fee would need to increase from $12 for residential customers to $24.39, according to the plan, if property taxes were no longer available to fund the work.

Right now, according to Cender & Co.'s documents, the current cost of trash collection is $5.7 million, and $2.8 million of that is funded by the trash collection fee. The rest is funded by property taxes.

Several community groups are protesting that fee because a Lake County judge voided the contract it funds.

Distressed board chairman Ryan Kitchell didn't return calls about the plan, nor did Richard Comer, president of GSD's board of commissioners.

A final date for the distressed board to consider Gary's petition has yet to be scheduled.

Contact Jon Seidel at 881-3148 or jseidel@post-trib.com. Comment on this story at www.post-trib.com.

Cities and Towns Association

The pre-eminent organization for networking and information regarding Indiana Cities and Towns is the Indiana Association of Cities and Towns.

Some important resources there:

• IACT support of Kernan Shepard reforms for local government reform
• IACT Background and structure
• Indiana Conference of Mayors affiliate group

For more information call or check out the website:

Indiana Association of Cities and Towns
200 South Meridian Street, Suite 340
Indianapolis, IN 46225
(317) 237-6200

Indiana Cities and Towns

News today that affects our clients and potential clients:

"When asked what Northwest Indiana supporters of the Kernan-Shepard recommendations can do to promote his plans, Daniels' said, "Make noise, please."

Daniels' push for implementing the recommendations of the Kernan-Shepard commission came just days after Senate legislation to enact the reforms was amended to exclude Lake County from a key provision to replace county commissioners with a single county executive." From the Times

Hammond and Whiting discussing consolidating some services.

St. John and Dyer head to court over annexation battle.

Mayor of Portage still committed to consolidating 911 with county dispatch, to save money and to increase public safety. Head of fire union speaks out about not being included earlier.

Possible legislation in Indiana

We are attempting to keep abreast of pending legislation in the statehouse this year, especially legislation that may affect our municipal government clients. Here are the bills we're currently watching, how do you think they will affect local government?

House of Representatives Committee Schedule

House Bill 1620 would require government building to be built using energy efficiency standards established by the Indiana Energy Conservation Code. Curious, since we don't know a lot about this code if this substantially increases the cost of construction?

House Bill 1669 affects school corporations in the State of Indiana who desire to install a geothermal heating system, and the revolving funds available to do so.

House Bill 1435 which establishes a $10 judicial fee for the purpose of building a judicial center in Lake County

House Bill 1433 modifies the procedure to appeal a property tax exemption

House Bill 1441 offers changes to procedures for plan commissions

House Bill 1530 suggests a method for borrowing up to $2 million for consolidating government functions

More in a few minutes, General Assembly site is running slow this morning

Question - economic impact of adding an employee

Today a good friend asked a really solid question:

What is the impact of creating a job? Let's say the job pays $50,000 and is located in Indiana.

I did a little research, since it's nuggets like this that really make for policy decisions. The rule of thumb appears to be that wages "echo" through the economy resulting in roughly 3 times the impact of the original wage.

Some of that impact is in tax revenues to local, state and federal government. Some is in housing costs, consumer goods, and household necessities. Sure there would be dramatic regional differences and in some areas of the country a $50,000 wage isn't even enough to own a home and car. But all in all, creating good solid jobs creates a lot of opportunity and activity.

If you happen across this post and have some good links to studies with details, we'd love to continue the conversation.

Howard Fink promoted at Town of Merrillville

A hearty congratulations to our good friend, Howard Fink, with the announcement of his promotion at the Town of Merrillville to Town Administrator.

From the Times:

Howard Fink's responsibilities in Merrillville will increase starting Monday, but Fink said he is ready for the opportunity.

Fink, who has served as the town's community development director since 2006, was named town administrator Tuesday.

The Town Council decided to promote Fink about a week after a second town manager candidate declined the job.

Fink said he was honored to accept the position and happy town leaders have "trust and faith" that he can handle the administrative duties.

Town officials said the town administrator position has many of the same responsibilities of a town manager, but not as much authority as a town manager would have.

Some of Fink's new responsibilities include overseeing the town's daily operations, making sure the town is following proper rules and procedures and being a person residents can contact regarding town topics.

"I will work hard to meet the needs of Merrillville citizens," Fink said.

Fink is familiar with working with Merrillville residents. He led several informational meetings regarding stormwater management fees and also fielded several calls when the town decided to reduce to a single waste hauler.

Fink said he will still take care of the community development director responsibilities while working as town administrator. He said it's important to continue economic development work even with a slow economy.

Town Councilman Shawn Pettit, who is chairman of the Personnel Policy and Employee Benefits Committee, said Fink's promotion doesn't come with an increase in pay. Fink's current annual salary is above $50,000.

If Fink proves he can handle his added responsibilities, the Town Council could later offer him the town manager position. Fink said he would be interested in the job if given the opportunity.

"I wouldn't have taken this role if I wasn't interested," Fink said.

Town Councilman Richard Hardaway said he is confident in the decision to promote Fink. He said Fink has been a loyal town employee who will be able to lead the town in the right direction.

Again, Congratulations!