IBJNews

Anderson mayor seeks budget cuts up to 20 percent

Back to TopCommentsE-mailPrintBookmark and Share

Anderson Mayor Kevin Smith and city controller Sam Pellegrino are asking every city department to make cuts to their budget — and some requests go as high as 20 percent.

But layoffs are not the way the city wants to accomplish that, Smith said.

"The rumors about significant layoffs are not true," Smith said Monday afternoon. "We have no plans to lay off people in the near future."

Pellegrino said he has contacted department heads and asked them to cut as much as they can. He hopes to have those changes in place by the end of the month.

"I gave 20 percent as a guideline," he said. "We need to get down there. We are borrowing money from utilities to pay our bills."

Pellegrino said that if departments can make larger reductions that would be even better. But he understands that if some departments cut 20 percent, they would be wiped out. So there is some flexibility, and reductions will vary between departments.

"Twenty percent is an aggressive request by Pellegrino," Smith said. "I don't know if we can meet that demand across the board."

Smith is trying to reverse the borrowing of the last few years, when loans of $4 million each year were received just to cover early-year payroll expenses. The reason this happens is because the city has not budgeted for an operating balance — funds that would allow the city to cover payroll during the first part of the year until the state makes its first tax repayments in May or June.

Property tax revenues are only paid out twice a year, which means the city does not have a continuous 12-month cash flow, Smith said.

The city currently has no operating balance. Past practice has been to borrow money from the city's utility reserve fund or the Indiana Bond Bank, which requires a small interest added to the repayments.

There are several areas of department budgets that concern Smith. One of them is overtime expenses.

Based on how much overtime the fire department has paid so far this year, if it continues at that pace, it will be in the hole by more than $50,000 at the end of the year, Smith said.

Smith said that he cannot discuss the budgets and manpower at other departments because of labor negotiations.

The city has six union contracts, and five of them are due for negotiations this year, said human resources director Wayne Huffman. Those unions are Fraternal Order of Police, International Brotherhood of Electrical Workers, United Auto Workers, American Federation of State, County and Municipal Employees, and Utility Workers Union of America, he said.

Pellegrino approached department heads a few weeks ago to request that they submit proposals on how to reduce their expenses.

"Some of the department heads have already contacted me and told me their game plan," he said. "I would rather them do it than me."

Since first discussing this with departments, the county learned it will be getting some unexpected money from the state, about $3.2 million from the state's $206 million accounting error. It should help reduce the extent of cuts this year, Pellegrino said. Smith expects Anderson will receive less than $1 million.

Smith said that every government has money, but the key is to determine how to prioritize budgeting needs. He is trying to prioritize those expenses this year, so that the city can move in the same direction next year.

"Realistically, in Anderson we continue to decline in revenues and population," Smith said. "We can't continue to do things as we have always done them."

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
 
Subscribe to IBJ
  1. By Mr. Lee's own admission, he basically ran pro-bono ads on the billboard. Paying advertisers didn't want ads on a controversial, ugly billboard that turned off customers. At least one of Mr. Lee's free advertisers dropped out early because they found that Mr. Lee's advertising was having negative impact. So Mr. Lee is disingenous to say the city now owes him for lost revenue. Mr. Lee quickly realized his monstrosity had a dim future and is trying to get the city to bail him out. And that's why the billboard came down so quickly.

  2. Merchants Square is back. The small strip center to the south of 116th is 100% leased, McAlister’s is doing well in the outlot building. The former O’Charleys is leased but is going through permitting with the State and the town of Carmel. Mac Grill is closing all of their Indy locations (not just Merchants) and this will allow for a new restaurant concept to backfill both of their locations. As for the north side of 116th a new dinner movie theater and brewery is under construction to fill most of the vacancy left by Hobby Lobby and Old Navy.

  3. Yes it does have an ethics commission which enforce the law which prohibits 12 specific items. google it

  4. Thanks for reading and replying. If you want to see the differentiation for research, speaking and consulting, check out the spreadsheet I linked to at the bottom of the post; it is broken out exactly that way. I can only include so much detail in a blog post before it becomes something other than a blog post.

  5. 1. There is no allegation of corruption, Marty, to imply otherwise if false. 2. Is the "State Rule" a law? I suspect not. 3. Is Mr. Woodruff obligated via an employment agreement (contractual obligation) to not work with the engineering firm? 4. In many states a right to earn a living will trump non-competes and other contractual obligations, does Mr. Woodruff's personal right to earn a living trump any contractual obligations that might or might not be out there. 5. Lawyers in state government routinely go work for law firms they were formally working with in their regulatory actions. You can see a steady stream to firms like B&D from state government. It would be interesting for IBJ to do a review of current lawyers and find out how their past decisions affected the law firms clients. Since there is a buffer between regulated company and the regulator working for a law firm technically is not in violation of ethics but you have to wonder if decisions were made in favor of certain firms and quid pro quo jobs resulted. Start with the DOI in this review. Very interesting.

ADVERTISEMENT