News From Terre Haute, Indiana

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September 12, 2013

Public can preview 2014 city budget

TERRE HAUTE — The city’s 2014 budget may get some close attention tonight in City Hall.

In a public hearing at 5:45 p.m., city officials will listen to any members of the public who wish to ask questions or raise points about the approximately $89 million proposal.

The same meeting will cover the 2014 sanitary district budget.

Typically, few – if any – members of the general public attend such budget hearings, but this year could be different as members of the City Council have raised questions about the health of the city’s finances, even hiring their own financial consultant.

Council concern has focused on the city’s general fund budget, which pays for many day-to-day expenses, such as city employees’ salaries and benefits. The proposed 2014 general fund budget is $33.7 million, according to city budget documents filed with the state.

The city has been spending millions more each year than it has received in revenue, said Councilman John Mullican, D-6th and chairman of the council’s finance committee. “That sort of plan isn’t sustainable.”

While city officials have advertised a 2014 budget with a $33 million general fund, the city is very unlikely to actually receive that much money, said Leslie Ellis, city controller. City officials advertise a high budget figure in an effort to receive maximum funding from the state, she said.

“The goal right now is to ensure the maximum levy” to best support city services, Ellis said. The greater the levy, the greater the city’s flexibility, she said.

Advertising a greater figure than expected is the same process followed by other local taxing entities and is nothing new, Ellis said. “There is no difference in the process for the school corporation and the city,” she said.

The city receives its largest revenue payments from the state of Indiana just twice each year, and officials seldom know very far in advance how much those payments will be. That makes tying down actual spending figures difficult, Ellis said. Another difficulty is that the city’s assessed values are still unknown for 2014, she said.

What’s more, while the City Council is expected to approve the budget in October, the state Department of Local Government Finance often doesn’t approve the budget until February or even March, Ellis said.

Councilman Neil Garrison, D-5th, who spearheaded efforts to hire Sackrider & Co., an accounting firm, to advise the council on financial matters, remains deeply concerned about the city’s 2014 budget.

“Property tax caps have often been the blame for our debt, but when you look at our general fund revenue from 2008 to 2012, I see a positive increase of just under one million dollars over that four-year period,” Garrison said Wednesday. “Yet every year budget spending has increased. My fear all along is if this trend of spending more than we take in continues, it will eventually fall back on taxpayers in the form of increased fees and taxes.”

Once local government budgets are approved, they are available for review on the state of Indiana’s “gateway” website. Until then, tonight’s meeting may be the best chance for members of the public to ask questions about city revenue and spending in 2014.

The Terre Haute City Council is expected to adopt the budget, which is prepared by the mayor, at its regular meeting at 6 p.m. on Oct. 10 in City Hall.

Reporter Arthur Foulkes can be reached at 812-231-4232 or arthur.foulkes@tribstar.com

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