Sunday, February 03, 2013

City Plans To Borrow Money To Pay Bisard Litigants' Claims

The Ballard administration agreed to pay $2.3 million last year to settle two lawsuits brought by the motorcyclists injured or killed when IMPD Officer David Bisard's police cruiser crashed into them while they were stopped at an intersection. I noted at the time the City's payout in both cases contravened the state's Tort Claims Act limiting to $700,000 the amount an individual claimant can recover from a personal injury claim from a governmental entity. The litigants' attorneys tried to skirt that limit with a dubious civil rights claim they were allowed to pursue by Judge William Lawrence despite well-stated 7th Circuit Court opinions disallowing litigants to pursue such claims in lieu of a traditional tort claim. Rather than appeal the trial court ruling, the City set a horrible precedent by settling the cases for an amount higher than the payout permitted under state law, encouraging future litigants to pursue the same strategy.

The IBJ is reporting in the latest edition that the City's Office of Finance & Management is planning to issue $2.5 million in bonds to pay the two settlements. While the CIB has large cash reserves in its budget, which will grow even fatter as a result of two new tax increases passed by the City-County Council to benefit its activities, the City claims it now only has about $4 million in its rainy day fund, representing less than 1% of its general fund. City Controller Jeff Spalding told the IBJ that he considers the bond issue "the only option, since the 2013 budget spends down most of the rainy-day fund." So not only did the administration pay out more than state law permits, the problem will be compounded now that a costly bond issue and accompanying interest payments on the principal will have to be paid. Last year, the City drew funds out of the downtown TIF district to loan to the library district and IndyGo to help out with their budget woes. If the administration had gone along with Councilor Brian Mahern's plan to assess the CIB for a one-time $15 million PILOT for the 2013 budget year, the City could have paid the litigants' claims without resorting to borrowing. This is just another in a long string of examples of how city finances are being sacrificed for the benefit of the CIB.

8 comments:

Cato said...

All monies required to be paid to settle cop claims should be paid out of cop pension funds, current and retired. If the payables reduce a retired cop's pension payments so that his income no longer cover expenses, all the better. Let the current cops be subject to many coercive and moderating influences.

The taxpayers should not be answerable until every dollar of cop pension money is exhausted.

Taxpayers should not be forced to answer for cop abuses.

SW Lane said...

"Cop pension money" is tax paid, you fool.

Cato said...

Learn to read a spreadsheet, bozo.

Had Enough Indy? said...

I'm guessing we are paying a $200,000 fee for this bond. Any idea what the total taxpayer tab will be with intereste added in?

Had Enough Indy? said...

It looks like the proposal has been postponed by the committee until its next meeting. Maybe sane use of bonds is being discussed.

Gary R. Welsh said...

Pat, I believe I read where it will cost about $100,000 to issue the bond, plus interest. Spalding claims the bond will be paid off within a year. I don't know why they wouldn't shift money between funds rather than go through the expense of issuing a bond for that short of a period of time.

Had Enough Indy? said...

It feeds money to the Bond Bank, whose expenses are not appropriated by the Council.

Had Enough Indy? said...

It also would be paid through an additional increase in property tax rate, instead of from the normal revenue streams - so it would not cut into the ordinary spending.