Wednesday, August 01, 2007

City Finances On The Brink

Gov. Mitch Daniels' order to freeze Marion County assessments at last year's level until reassessments countywide can be completed has exposed the extent of the fiscal mess Mayor Bart Peterson (D) and his Democratic-controlled council have created. The Star's Brendan O'Shaughnessy reports that the assessment freeze leaves the city $52 million short in revenue--presumably the amount the city hiked your property taxes this year--which could force the city to borrow money on a short-term basis to get by. Weren't we told the schools were to blame for our skyrocketing tax bills?

This sentence in O'Shaughnessy's article really bothers me. "The amount also is greater than what city officials expected when Daniels issued his order in response to skyrocketing property taxes this year," he writes. If that's true, then it must also be true that the city was anticipating an even greater windfall in property tax revenues due to reassessments than it originally anticipated. Now let's not forget the city is going to eventually capture those revenues, even if it doesn't happen for another 6-8 months when the reassessment is completed. And lest we forget the Mayor and the City-County Council just hiked the county option income tax another 65%, generating an additional $90 million in revenues. "We're trying to avoid draconian cuts," city Controller Bob Clifford said. "But the echo effect of this is tremendous." So how could the sky be falling?

If the city can't manage with the additional $90 million in new-founded revenues with the same property tax revenues it collected last year, then something is truly wrong with the way this city's finances are being managed. The city is still going to collect at least as much in property tax revenues this budget year as it anticipated before the Governor ordered the property tax freeze. The only question which remains is how those property taxes are going to be allocated among Marion County's residential and business property taxpayers. Personally, I think it is another case of a manipulation of the numbers to suit the Mayor's agenda.

26 comments:

Anonymous said...

How in the world can the Mayor expect people to believe that he has made cuts of $18 million and in the same breath say he's now $52 million short????????

Toss out the argument over the anticipated revenue from property tax being delayed and it's perfectly clear that the Mayor has, and will continue to increase spending. If the Mayor's spending had not increased then there would have been NO budget shortfall.

Were not talking about the school budget were talking about the Mayor's own budget for city services.

I hate to chime in with the Bart Lies crowd but I'm afraid that it's true. Personally, I'm very tired of the "baffle them with bullshit" approach to the management of my tax dollars by this Mayor.

I'm afraid this city is in dire financial staits it will get worse before it's better.

Wilson46201 said...

Since schools are about half the recipients of property taxes and the city a third, it can be estimated that schools will be around $75 million short. We simply havent heard yet from the financial analysts of the schools ... schools will be hit hard too!

Wilson46201 said...

Reassessments shouldnt be producing any "windfalls" for government entities. The entities request a fixed amount after their budget process -- this fixed amount is called a "levy". Reassessments are changes in the proportion various taxpayers pay to meet this fixed dollar amount. A higher total assessed value produced by a reassessment will be offset by a corresponding decrease in the tax rate producing tax collections of the same amount.

by the way, the city-county budget had planned spending $814 million this year...

Anonymous said...

Holy Mary Mother of God!!!!!! Bart has outdone himself once again. The guy is truly talking out of both sides of his mouth. Remember folks, just a few weeks ago Hizzoner himself was all over the news talking about how the Gov needed to give Marion County homeowners property tax relief. Then, when he gets the relief he wanted, he raises income taxes, then complains the state isn't giving the city enough money. HOLY **** folks, he continues to show how unaccountable he is for complete mismanagement of city funds over the last 8 years. If you vote for this guy in Nov, I've got some oceanfront property in Arizona I'll sell your for real cheap, SUCKERS. Viva la Machine!!!!

Anonymous said...

I have a hard time believing that the city can't find 5%. Frankly, I have a hard time believing the city couldn't find more.

Anonymous said...

To me it is like the city is like a worker who is EXPECTING a raise in his salary midway through the year so he already planned to spend that new money he would get from the raise on a new TV or vacation. That worker thinks :I always get a raise every year no matter what I do . . "

Low and behold - no raise - but he still has obligations to spend money on thing he already planned for with the raise.

Anonymous said...

In my lifetime (74 years) I have seen quite a number of Mayors come and go in our City but I believe that Mayor Bart Peterson is the worst of the lot. Don't get me wrong, I've seen some very bad Mayors, both Republican and Democrat.

Anonymous said...

Wilson - Do you think the Mayor PLANNED to spend the expected increase in property tax increase the city would have recieved from the July property tax bills ?

Anonymous said...

Tax & Spend!

-Bart Peterson (D), Mayor

Anonymous said...

All the woe and gloom from the 25th floor is certainly not smart politically.

I'd stay quiet on this stuff, and just make cuts after the process is completely finished. Frankly, all the tax and budget screaming headlines have begun to wear me down.

The governor's delaying action, will cause financial hardship on all taxing entities. It ought to be manageable, but apparently, the mayor thinks otherwise.

It's kinda like Wilson saying only 1.5% of our tax bill goes to township government. Sounds like a small number, but it's millions.

The mayor chose the $52 million for the same reason, on the OPPOSITE end of the scale. It sounds like a large number to cut. As in, "we'll die without this money."

The percentage of that cut would be, uh, what, Mr Mayor? Here's where it makes more sense to use a percentage.

Show me any budget--personal or government or business--that cannot be cut 5%, and I'll show you a fool.

Anonymous said...

RALLY:
http://hoosiersforfairtaxation.blogspot.com/2007_08_01_archive.html

Anonymous said...

Wilson - help me out here . . .

Some time in 2006 the city, county and taxing units said we nned to raise X Amount ( say 500 million dollars ) in total in property taxes to cover what they need to do in 2007.

Then 2 times in in 2006 property taxes are raised to cover the increase required by the ealrier 2006 request.

Then later in 2006 The city and county submit a budget that includes spending for the 2007 budget year that is covered by their share of the property tax.

In the begining of 2007 a new budget year starts and any money spent falls under some budget line item that are in part covered by the property tax incerases that went through in 2006.

So intheory even if the 2007 property tax rates are FROZEN at 2006 levels that moeny would not even be spent until 2007.

So why a 50 million short fall the rest of this year ?

Anonymous said...

Peterson has hired two neighborhood liaisons.
According to his staff they are replacing vacancies.
What happened to the hiring freeze?

For the information of you anti-IndyU nutcases, I called his office and checked the facts. They are paid positions.

ROACH said...

how to decimate the property tax base in Indiana, and give "my Man Mitch", and the gophers paroxysms of apoplexy.
http://x-wire.blogspot.com/2007/08/how-to-decimate-property-tax-base-in.html

Anonymous said...

Wilson, rather than attack your on-going support of our city government (which I see is fully PRO BART), please answer the following: If Peterson is a leader, and committed to improvements in the city, then why will he not cut his personal staff, and why in the world would he just announce two "replacement" neighborhood liaisons? He is either incompetent as a fiscal leader, or really believes that the people of Indy are stupid. Please respond to these two specific examples (out of many).
I am not trying to be argumentative, just wanting to understand. Thanks.

Anonymous said...

lets think about this scenario.
bart depends on sweetpea for making important decisions as he stated in one of his press releases.
sweetpea had his construction equipment reposessed at the midfield project( not a conflict of intrest )
sweetpea is filing for bankruptcy.
$ 700.00 a month is being garnished from sweetpea's IFD salary and this idiot is gonna be in charge of an 800 million dollar budget!.....there is something wrong with this picture. even you Wilson should catch on to this!

Wilson46201 said...

Councilor Gray is but one vote out of 29. He is hardly the man in charge of drafting the budget - far from it! His leadership position is to ensure the city-county council passes an approved budget ... with a narrow 15 to 14 Democratic majority on the Council, Monroe can offer advice to the Mayor what is acceptable to a sufficient majority of voting councilors.

Anonymous said...
This comment has been removed by a blog administrator.
Anonymous said...

Uh, Gary...time to start monitoring again?

The 4:38 post was creepy. Especially the "you know who I am" thing.

Wilson never answers direct questions that might embarrass his position. Monroe Gray is an abject failure as a leader because of his personal difficulties. It carries over.

City council pay garnished...shameful.

Anonymous said...

"frankly. im fuc*ing tired of it and liberal faggots like you wilson."

Damm give the guy a break. I think Wilson is a nut job, but the name calling goes a bit far.

Anonymous said...

Interesting that Wilson says that Mr. Gray is only one vote of twenty-nine, almost as if being the leader of the council meant nothing?

Surely Wilson has to give us more credit than that?

GaryJ said...

I am not a Wilson fan either, buut he is entitled to his opinion. If AI doesn't like the comment, AI can delete it.
Wilson has blinders on . He sees only what the Democrat machine tells him to see.
Wilson is not a stupid man. He just doesn't use his intelligence to benefit the public. He knows Bart and Monroe are crooked and should be ousted.
CAlling Wilson names only stoops you BELOW his level of calling people "trolls, anonymous nobodies, etc.." Don't give him a chance to capitalize on your own comments.
If the CCC would approve a budget WITHOUT blank pages, maybe the "fill in the blanks later" wouldn't exist and Bart would have to follow what he is given.

Anonymous said...

I do apologize to this blog about the hateful comment i made earlier about wilson. i was somewhat intoxicated. i'm just tired of people who stick up for crooks and thieves. this city that i love is in the sewer and i'm upset.the ghetto mafia has ruined
"my town". i do get upset when wilson sticks up for all the evil here. sorry gary!. btw, nice meeting you at the canal last sat.

Anonymous said...

If the Peterson administration knew all this was going to happen why in the heck did we build the new stadium, give all the money from naming rights, the concession profits, the vast majority of money earned from other non football related event to the colts. Then we are going to give them another 50 million dollars when the "City" breaks the lease on the RCA Dome. Would it be possible the City needs to get the money on board before the start of the 2008 season.
We also raised taxes on food, car rentals and hotel stays to help pay for the new stadium. The money raised in the Indianapolis area could be going to help our City and not a private enterprise.
Peterson should have been planning the saving of the City instead of giving the City away to the the Colts.

Anonymous said...

Gary, although you are usually very well informed, I think you missed the boat on this one. The spike in property taxes does not equate to city gov receiving a windfall. The levy has remained fairly flat. The reason is mainly due to state law changes that shifted the burden from business to residential as well as the state capping the property tax relief. That being said, when the governor decided to allow folks to pay the 2006 amounts,this does not account for the loss of inventory tax because the order allows businesses to delete this from the 2006 taxes paid to be be paid in 2007. Also the state is not kicking in the relief previously granted in 2006. All of this is what is leading the shortfall in 2007 reviews that all local governments are experiencing in the counties ordered to re-do the assessments.

Anonymous said...

"We the People" are only pawns in this everlasting government game that is being played under our noses, and with our money!
No more votes for any incumbent for as long as it takes.

When it spends, the government doesn’t seem to remember the money is not theirs. It is ours, and they have been entrusted to spend the money wisely, carefully and with restraint.

“They (congress) spend money like drunk sailors on liberty,” the old Ronald Reagan quote. Trouble with his analogy, sailors are spending their own discretionary money, not their food or housing money, but the key two words, "Their Discretionary" money.

Congress, State legislatures and city governments are spending our money and most of what they spend is no longer our discretionary money but is beginning to cut into our food, medicine, housing and retirement funds.

Heard on the Garrison show:
“If you take care of spending, then the taxes will take care of themselves.”

How about the government working within their limited budget without "increasing" the budget limits?

The government (fed/state/city/county) expect us to live within the limits you "create" for us with our money, but none of the elected ones in government will ever live within the limits they need to.