Arthur Foulkes
The Tribune-Star
TERRE HAUTE —
The Terre Haute City Council finance committee hopes to set the stage for the 2013 city budget votes when it conducts a special meeting Monday,
Council committees only rarely meet in such special sessions. This meeting is designed to formulate questions, share information and take a closer look at the city’s financial situation, council members said.
The mayor prepares the city’s budget, but it must be approved by the nine-member City Council and the Indiana Department of Local Government Finance.
Councilman Neil Garrison, D-5th, and finance committee chairman John Mullican, D-6th, have expressed concern over the city’s financial status.
For example, Garrison said, the city likely started 2012 with a sizable negative balance in its important “general fund,” leading him to question assertions from Mayor Duke Bennett that the city has operated “under budget” since he took office in 2008.
“Some of the information we now have doesn’t support that,” Garrison said, noting that a recent consultant’s report indicated a $4.5 million deficit in the general fund at the start of this year.
Garrison said he would like the council to consider other options for obtaining budget information if it cannot get what he considers timely and accurate facts from the Bennett administration.
Administration officials were not specifically invited to the upcoming finance committee meeting; however, they are welcome to attend, Mullican said, noting that the meeting, which will take place about 4:35 p.m. Monday in the City Hall courtroom, is open to the public.
Bennett said members of his administration will attend the meeting.
“We’ll be there and be ready to answer any questions we would be asked,” Bennett said Friday.
The mayor also defended his assertion that the city has operated under budget since he took office.
Being “under budget” does not mean revenues to the city have always been greater than expenses; it simply means that the city has spent less than the council has approved each year, he said.
“If we spend $1 more [than is approved in the budget], we have to go to the council for an additional appropriation,” Bennett said.
The mayor also said he would welcome in-depth budget meetings.
Since the state’s property tax caps took effect in 2008, that source of city revenue has dropped by several million dollars annually, or about 25 percent, Bennett said. That has forced the city to use reserves to cover annual expenses and, now, those reserves are gone, he said.
The good news, Bennett said, is that now the property tax caps, which have been phased in annually, are fully implemented, meaning the city can begin planning its budgets using more accurate revenue projections.
“This was our last critical year to get through,” Bennett said, adding his administration is currently working a plan to equalize spending and revenues in the future based on the now-stable revenue picture.
“We’re probably a year or two away” from a truly “balanced” — as opposed to a “fundable” — budget, Bennett said. If not for declining property tax revenues in recent years, “I’d have been there by now,” he said.
Reporter Arthur Foulkes can be reached at (812) 231-4232 or arthur.foulkes@tribstar.com.
