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Council OKs Hogsett plan to borrow $75M for roads, public safety

November 14, 2016

The Indianapolis City-County Council on Monday overwhelmingly approved issuing bonds to pay for about $75 million worth of projects to support city infrastructure, road funding and public safety.

The move is a win for Democratic Mayor Joe Hogsett’s administration, which originally faced skepticism from council Republicans over the decision to borrow to pay for a number of the city’s big-ticket capital expenses. Hogsett’s team says it is a strategy to reduce stress on the city's budget and help with its budget deficit reduction goal.

Some of the projects and expenses include $24.6 million for road funding, $5.2 million for parks funding, upgrading the city’s computer-aided dispatch and E-911 system, building two Indianapolis Fire Department stations, new solid waste trucks and equipment, new police cars, new voting machines and fire equipment.

The council’s top Republican, Minority Leader Mike McQuillen, said he decided to vote for the bonding requests out of a desire to “move forward and put partisan concerns behind us.”

McQuillen’s caucus had been clamoring to spend some of the $39 million recently returned to the city from state income tax reserves on infrastructure, but Hogsett’s administration said the city would be better served with the money sitting in a savings account for an emergency.

“It’s basically a vote to try to offer an olive branch or sign of good faith,” McQuillen said. “We all agree that we wanted to get on with these projects. Citizens have been waiting so long to get some of these crumbling streets, sidewalks and bridges repaired. I’d rather we weren’t bonding this … but at the end of the day it needs to be done and this is the way the administration wants to do it.”

Hogsett’s plan is to renew existing bonds that are expiring soon and the tax levies that fund them in order to reduce stress on the overall budget. If the city issues debt to pay for expenses that typically have been funded within the operational budget, it simply would continue with similar bond payments that are already factored into the city's overall budget.

Council Vice President Zach Adamson previously told IBJ the proposal was a “creative way to get more mileage out of existing revenue sources.”

The administration has said there will be no tax increase associated with the plan.

The bonding requests were considered separately: the $24.6 million for road funding passed the council 19-3; $23.8 million for public safety items passed 19-3; $21.4 million including a new computer-aided dispatch system and E-911 system passed 21-1; and $5.2 million for parks funding passed 21-1.

McQuillen, who said he spoke with Hogsett Monday, said there was agreement between the two of them that they would advocate at the Indiana General Assembly for more infrastructure money.

“We’re going to have a bipartisan effort from municipal government looking to our Legislature to see where we can find some more revenue to help us with these projects,” McQuillen said.

Still, council members weren’t giving up on the idea of spending at least some of the income tax reserve money on road funding.

Republican Jeff Miller issued a “challenge to the mayor” to consider spending $5 million per year from the income tax reserves on road funding.

“I think that’s a middle ground,” Miller said. “I completely respect the administration’s [viewpoint that] we have potential emergencies that could come before us.”

But he said he was frustrated that he’d have to tell taxpayers in his district that they would only be able to get two of their worst roads repaired with the available funding.

Council member Aaron Freeman, who was one of the only no votes on the proposals, explained that he was still upset over a recent decision to close a fire station in Franklin Township, but also was theoretically opposed to bonding.

“Bonds never seem to go away,” Freeman said. “When they expire, the citizens never seem to get the benefit. They seem to always be renewed.”

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