At the Feb. 2 meeting of the Carmel City Council, several bills were discussed that dealt with funding for various groups.
There are the annual arts grants given out by the city to local organizations. It’s time to renew the labor contract with the firefighters’ union. And the county is asking for $40,000 – which in the scheme of the budget is a small amount the council agrees – for a new public safety training center.
While no city councilor presented any strong objection to funding any of these projects, a group of four councilors say they want more time to examine the city’s financial situation. After the state’s Department of Local Government Finance cut more than $6 million from Carmel’s budget, some want to make sure they know how much money they have to spend.
BACKGROUND ON CUTS:
In November, the Council approved a 2015 budget of $78,325,108 for the city’s general fund, but the state approved a smaller budget, at the state approved a smaller budget at $71,637,690. The DLGF has the authority to approve city budgets to make sure they don’t exceed revenue projections, but often Carmel and the state disagree on how much money will be raised.
According to the DLGF Web site, the department is responsible for, “ensuring property tax assessment and local government budgeting are carried out in accordance with Indiana law.”
Carmel Mayor Jim Brainard always plans double-budgeting of the city’s bond payments because it can be advantageous to be able to decide which account to take the money from. In addition, the larger budget helps to protect the city’s tax levy. Cities will set a percentage rate for imposing taxes, called a levy rate, which is then used against assessed value of each homeowner’s property. Carmel set its 2015 tax rate at $0.7007 per $100 of assessed value.
City Councilor Eric Seidensticker said he disagrees with Brainard’s practice of double-budgeting revenue sources just to keep the tax rates where they are.
“The State of Indiana allows double budgeting,” he said. “It’s a lie. Every clerk-treasurer knows that it’s a lie. We are falsely raising the necessary revenue we need so we can maximize the tax levy.”
City Councilor Luci Snyder estimated that if you take out the double-bond payments from the budget that there is still a $5 million “shortfall” but Brainard doesn’t see it that way. He said the budget is always restored once the revenue comes through in the spring. He said the DLGF is overly conservative and there’s nothing to worry about.
City Council President Rick Sharp pointed out that last year when the council restored the money the DLGF cut from the budget, it came from the city’s rainy day reserve account and they did that only to help pay for badly needed road repairs.
OUTCOMES AND AFFECT:
Now the City Council is considering funding for various bills and some councilors – predictably the “four S’s” as some Brainard supporters call them – are raising concerns.
This includes City Council President Rick Sharp, who is running against Brainard for mayor, Luci Snyder, Carol Schleif and Eric Seidensticker. Some have said that these councilors are objecting for political reasons (all four of them face a registered opponent in May’s election while the three Brainard-friendly city councilors Sue Finkam, Ron Carter and Kevin “Woody” Rider face no such challengers). Of course, on the other side of the argument, Seidensticker raised the idea that extra spending for a group like the firefighters union might just be a way for Brainard to keep his friends happy in an election year.
Brainard said that past history should show that the DLGF is very conservative and that Carmel shouldn’t be concerned about the cuts.
“This has happened every year for at least a decade,” he said. “This is simply the way the Department of Local Government Finance does business. They don’t have the staff, the time or the energy. They simply look at a very conservative revenue projection and many of the funds are calculated based on historical averages. They assume a three percent growth rate and they don’t look to see if we annexed or grown. They don’t give us credit for any operating balances from the previous year.”
Here are the three issues that all seem to come back to the budget cuts at the Feb. 2 meeting:
- Arts funding, which is annually set at 1 percent of the general fund. Last year, the council waited because they weren’t sure what that amount would be since the DLGF made cuts. There was a question about whether to set it at 1 percent of the originally submitted budget or the budget after the cuts.
- An initial $40,000 investment for the Hamilton County Public Safety Center. This $3 million project will be paid for by every city in the county, but the Hamilton County Council is looking for support from each of the cities. Sharp and Seidensticker both spoke and said they had no problem with the $40,000, but they wanted more concrete specifics because this money essentially amounts to a commitment to the project and they want to learn more about the ongoing operational expenses that could occur year after year.
- Police and fire contracts. The police contract was approved unanimously at the Feb. 2 meeting, but the firefighters’ contract was tabled and sent back to committee because there were some amendments from the previous contract that concerned some councilors.
Brainard agreed that more questions should be asked about the public safety center.
“I think there are a lot of unknowns and I think the council’s questions were on point,” he said.
Snyder formally asked for Brainard to answer three questions in writing relating to the budget:
“Mr. Mayor, I request that you specifically address these shortfalls…in writing. Tell us which requests can be covered in your 2015 budget,” she said.
“From which funds, departments or projects do you intend to take the money and in what amounts? You are the chief executive and we are not able to do that,” she said.
“Finally, what are the final budget numbers in each department and specifically the General Fund numbers?” she asked.
MORE ON FIREFIGHTERS’ UNION CONTRACT:
For most years, the contracts don’t change much each time for labor agreements with the city. There were some changes to the firefighter’s union contact in 2015 and 2016 that concerned some councilors.
Some changes that raised eyebrows:
- Newly added: “The Department shall provide facilities and equipment to allow employees to maintain physical fitness at each station. Decisions related to the location of the fitness facilities, the type of and replacement of fitness equipment are within the sole discretion of the Department.”
- Cost of living adjustment is at 2 percent for 2015 but shoots up to 3 percent for 2016.
- Newly added: “In addition to fulfilling its statutory obligation to the 1977 Police and Fire Fighter Pension and Disability Fund, the City will contribute an additional 1.3% of the pension base on behalf of firefighters’ contribution to the 1977 Fund, resulting in a reduction to the firefighters’ contribution in the amount equal to 1.5% of the pension base. To further clarify, of the 6% of the pension base owed by firefighters to the 1977 Fund, the City will pay 1.3% and the employees will pay 4.7%.”
- Newly added: “The City sponsors a tuition reimbursement program for full-time employees who are employed by the City both on the year prior to the beginning of the course for which tuition reimbursement is requested and at the time the final request for reimbursement is made. To be eligible for tuition reimbursement the employee cannot have been subject to disciplinary probation, demotion, or suspension within the 90 calendar days immediately prior to the beginning date of the course for which tuition reimbursement is requested. Refer to Carmel Fire Department Rules and Regulations 4.16 TUITION REIMBURSEMENTS.”
- New added parameters for annual specialty pay for employees:
Paramedic 10% of First Class Firefighter Salary
Shift Investigator $2000.00
Hazardous Materials $2000
Foreign Language $2000
Ride – Out Pay:
“An employee shall be entitled an additional $2.00 per hour for each hour he or she is assigned to an ambulance, in addition to all other forms of compensation. A faptain who fills in for Battalion Chief shall receive $3.00 per hour ride-out pay, and a firefighter who fills in for an Engineer, Lieutenant or Captain shall receive $2.00 per hour ride-out pay, in addition to all other forms of compensation. Officers filling in for other officers (except filling in for Battalion Chief) are not eligible for ride-out pay.”
Questions were raised about all of these costs and whether it was all properly budgeted for in the 2015 budget before or after the cuts. Tuition reimbursement was a concern for some councilors because the city has never set up a fund for this. Brainard responded that it’s all accounted for and the fire department knows where to get the money from and some city councilors just don’t understand which line item this would come from.
“The contracts are fully funded as presented to the council,” Brainard said. “It’s not a matter of matter of cutting. I think the confusion was which line items the items were in. The personnel line items can be moved at will by the department head.”
Seidensticker raised the question about tuition reimbursement at all. He said guidelines need to be followed so it’s a wise investment for the city for employee training.
“We have not funded the budget for tuition reimbursement. We haven’t funded it since 2011,” he said. “If the money’s there, the money’s there. If we are going to reimburse for education, then it needs to address the growing concern in the city that taxpayer dollars are spent wisely. It’s not that we don’t want people to be educated. We do. But we don’t want to see you go become a doctor of divinity and then preach at a church and leave the city because the city, the taxpayer, is not receiving the benefit of the money spent on you.”
Seidensticker said there’s an increase of $170,000 in the new contract and he wondered where that money will come from.
“The statement to me is that there should be enough money left in the budget to cover that,” he said. “So, you over budget by nearly two hundred thousand dollars? That’s a chunk of change.”
Seidensticker raised the question about why the contract wasn’t considered when the City Council was deciding on a budget.
“Because it’s political silly season, they decided to do this now so everyone can see the dog and pony show,” he said.
Seidensticker said it’s a tricky situation because nobody is against firefighters.
“It’s a transparency issue,” he said. “Why wasn’t this discussed during the budget process?”