City Council Responds To Notice With Budget CutsIn a special session Thursday, the Warsaw Common Council approved a resolution reducing the 2022 budget by $510,200 in response to the 1782 Notice from the state.
That reduction will allow the city to reach an overall tax rate of around $1.2388 per $100 of assessed valuation.
The 1782 Notice, from the Indiana Department of Local Government Finance, gives political subdivisions notification specifying any revision, reduction or increase the DLGF proposes in a political subdivision’s tax levy or tax rate, according to the state website at www.in.gov. The political subdivisions – such as the city of Warsaw – have 10 calendar days from the date the political subdivision receives the notice to provide a response, which may include budget reductions.
Mayor Joe Thallemer told the Council, “So, 1782 Notice, basically we solicited line 2 cuts that went into the reserves. And tonight, we’ll be asking for you to accept the spending cuts for next year’s budget.”
The $510,200 reduction in the 2022 budget includes $364,200 from the general fund; $84,000 from parks and recreation; $30,000 from aviation; and $32,000 from cemetery.
“And then the majority of that came from us overbudgeting our health insurance expenses. There were some other items given, but the vast majority of that money came from the good fortune we have of a 6% decrease this year instead of a 12% increase that we had budgeted for,” Thallemer said.
He said Clerk-Treasurer Lynne Christiansen’s first response to the 1782 Notice is to apply all of the reductions into the operating balances.
“This is what we usually do every year to get our tax rate down and just take unnecessary spending (out) that was proposed in the original budget,” he said.
Cuts will reduce the fire territory rate from $0.2857 to $0.2606 per $100 of assessed valuation. The fire territory’s spending cut totaled $381,465.
Thallemer said because of the need to cut the budget, he asked Fire Chief Mike Wilson to take two firefighters out of the equation. Wilson had asked for four new firefighters and a CARES coordinator for 2022. Health insurance cuts also helped reduce the fire territory budget.
“So, his budget, at the end of the day, he will be left with about a 26% reserve with his current spending with those reductions made,” Thallemer said.
“With the spending cuts we talked about, the $510,200, that added to the current reserves gives us a 20% reserve in our general fund,” he said.
The impact of all of that, Thallemer told the Council, is that the overall tax rate will be $1.2388 per $100 of assessed valuation, an increase of about 4 cents over the last year. The city’s rate last year was $1.1967. In 2015, the rate was $1.2291. In 2016, it was $1.2391.
Councilman Jeff Grose later said, “I’ve been around a long time, and over the past five years, I think we went three years in a row without a property tax increase. They’ve been minimal.”
He said that was due to a very creative, very industrious private sector, but also great city department heads and employees who do their jobs. He credited the other Council members for being on top of everything, and he said the city also is very fortunate to have Thallemer as mayor because “of his very progressive leadership. I really believe it’s put us in this position for the last several years. ... This is so encouraging. This is so encouraging to hear.”
Councilwoman Diane Quance said, “I think it’s important to note, too, that in a world of government where balanced budgets are a rarity, we have a balanced budget and we have reserves to take care of any emergencies. And I think that’s a tribute to everyone.”
She made a motion to pass the resolution, and Council President Jack Wilhite provided the second. It was approved 6-0, with Councilman Jerry Frush absent.
In another discussion, Thallemer said that now that the budget work has finished, he would have a committee of three of the Council members to sit down with him to look at the American Rescue Plan Funds that have been appropriate for next year. The city has until the end of 2024 to spend its alloted $3.4 million. Of that amount, $3.1 million can be used as revenue replacement because of the COVID-19 pandemic.
Finally, Thallemer said redistricting for the Council will have to happen in 2022. City elections are in 2023, and the redistricting must be completed by the day after the fall election. It is the Council’s responsibility to handle the redistricting as they are the city legislators. The mayor has nothing to do with the redistricting except to make sure the Council does it right. He said it is a very public process, but with the technology available it should be easier than in years past.
Districts have to be divided evenly by population and must be compact. Thallemer noted the city has grown by 2,254 residents over the last 10 years, according to the U.S. Census.
