A Democrat-controlled City-County Council committee on Thursday night approved taking $15 million from the Capital Improvement Board to help close the city’s $65 million budget shortfall.
The plan—opposed by Republican Mayor Greg Ballard and members of the CIB—now advances to the City-County Council, which will vote Monday night. Democrats hold a 16-13 edge on the council.
Sen. Luke Kenley, an influential Republican state senator, also opposes the move. He told the Indy Politics blog this week the state would be “very hesitant” to provide any funding in the future to the city, singling out the city’s plans for a mass-transit system.
City officials are exploring ways to close the $65 million shortfall in the $595 million general fund, which covers daily operating expenses.
To do that, Council Vice President Brian Mahern is leading a charge among council Democrats who want to collect a so-called “payments in lieu of taxes” on CIB-operated properties exempt from property taxes, including Lucas Oil Stadium and the Indiana Convention Center.
The council's municipal corporations committee Thursday night approved drawing $15 million from the CIB along party lines. Both Mahern and fellow Democrat council member Monroe Gray, who chairs the committee, argue it’s only fair that the CIB provide some assistance. They say the city provided the CIB funds from the downtown tax-increment financing district when it needed help.
“Personally, I wasn’t excited about giving the CIB a helping hand a few years ago,” Mahern told IBJ, “but we did.”
Indy Chamber CEO Scott Miller sided with critics of the committee's action.
“Addressing a long-term problem with a short-term solution is irresponsible and creates a fiscal cliff that would be a detriment to long term stability, economic attractiveness and job growth in our city," he said in a prepared statement released Friday morning. " We urge the Council to reject this measure and instead seek a consistent, long-term solution to this budget shortfall.”
The once-cash-strapped CIB expects to have a cash balance of about $67 million by year’s end. But the agency’s president, Ann Lathrop, insists that much of the reserve—$52 million—is earmarked for improvements to the properties and debt payments.