Terre Haute's new convention center is getting ready for an April 9 grand opening, the city will have to adjust budgets for higher gas prices, and increasing sewer rates will help fund the city's long term control plan.
On this week’s installment of Ask The Mayor, Terre Haute Mayor Duke Bennett addresses these issues and more on a Zoom interview. Listen to the full conversation with Indiana Newsdesk anchor Joe Hren by clicking on the play button above, or read some of the questions and answers below. A portion of this segment airs 6:45 and 8:45 a.m. Wednesday on WFIU.
This conversation has been edited for clarity and conciseness.
Hren: Governor Holcomb is exploring severing ties with Russia, he's gathering data right now. Do you support that? And do you know if that would affect Terre Haute or Vigo County?
Bennett: I don't think it'll affect us much in any way. And I think the more sanctions the better. I know that may escalate things in different ways. But a message needs to be sent that you just don't go take over other country. I can't do much here locally, because we just don't have those kinds of relationships or situations. But I think it's important to send a unified message.
Hren: Gas prices are skyrocketing now and could set off a chain reaction - a city's transportation costs, people's cash flow, etc. How does the city budget for that?
Bennett: Prices have been up a little last year so we kind of anticipated some increase, but nothing like what we're seeing. And so it's always kind of a stab in the dark. But this is going to be where we're spending about twice as much a month that we normally spend. And so it's going to add up to be quite a bit this year, depends on how long it lasts. Hopefully it will start coming down at some point.
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But we'll have to appropriate some money because most of our budgets are pretty tight anyway, with a little bit of room to play. When you have double the expense on something, especially for the police department, street department, we're going to eat into that budget pretty good. But luckily, we've got reserves, we can deal with that.
Hren: It appears that the Indiana personal business personal property tax is a big sticking point still between the chambers. A lot of the testimony Monday focused on that tax. The business community supports tax cuts, and says local governments wouldn't feel the effect for years. And I know you've said differently?
Bennett: At least this version is stretched out a little bit. In the past, it wasn't. So that's progress from my perspective. You look at where our funding sources come from, we've reduced the amount of reliance on property taxes, okay, we all dealt with that - we've adjusted our budgets and moved forward accordingly.
If we lost another 20% of our income, whenever that comes, even if it's done over time, it's still going to be significant here, because it's pretty much salaries and benefits. You know, we're paying the light bill, we're paying our insurance, we're paying for fuel. It's just the operations of the city. We're not doing anything special with those tax dollars.
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So it's a little frustrating for me. I was at Statehouse last week got had a lot of great meetings with our delegation, to meet with speaker, Lieutenant Governor, we chatted about this. But at the end of the day, Indiana is one of the least tax states in the United States, we're in a great spot. And to eliminate this and just say, well, locals suck it up and raise the local option income tax, we don't want to put that burden on our people here locally, we want to share that.
So I'm hopeful that it won't pass. I mean, we're getting down to the end here. I'll stand on that hill and shout that out as long as I can. Because I feel very strongly about this one.
Hren: Last time we talked about the Churchill Downs site location decision off the interstate. Do you worry about not bringing that downtown and bringing business downtown?
Bennett: That's the old model of casinos a long time ago to either be on the riverfront or being in that downtown vicinity. But I think casinos have figured out the best place for them to be is out by the interstate somewhere where people can easily get to them. Yeah, you lose a little bit of the ability to sell the community and show off the community when they're not somewhere in the main heart of the community. But I feel like this is going to do what it needs to do and be successful in that location, which in turn, that means more revenues for the city, and the county and school corporation, everybody that participates in this, that we can all invest in ourselves.
Hren: The Convention Center is expected to open next month. How's that looking? And will the public be able to get a chance to take a look?
Bennett: Yeah, we'll have a ribbon cutting. And very soon on the ninth of April, and I'm excited for the public to see it. It doesn't really do you justice until you walk in there. It's first class, it looks great. That whole area is improved with this addition. It's going to be exciting, and I still get a few people saying, well, how are we going to bring a convention to Terre Haute? We know that they're coming. And this gives us a tool that we've never had before, a place for them to go.
Once we get it open, you begin to market it in a different way. So people can come and use it, you start getting the word of mouth, it's going to take off. And so I'm excited. I've been involved in this, probably about seven years now. And just to see it come to fruition is an awesome feeling for me personally, and the entire community.
I think they got six booked for this year. We're intentionally pacing ourselves, we need more hotel rooms. So we're working with the hotel developer in order to bring the bigger stuff. We need many more hotel rooms than our two hotels can provide. And then we'll be able to really go for the bigger events.
Hren: You had your annual city update a couple weeks ago, something I saw making headlines, the sewer rates going up eventually due to unfunded mandates. How much and what's the next step?
Bennett: So we're renegotiating our long term control plan with IDEM. It's probably going to be $300 million worth of work, hopefully over the next 30 years. Normally, they commit to 20 year plans. But we're asking for 30 so we can delay some of those rate increases. We have no choice, they make you do this. It's an unfunded mandate.
There's a lot more work that needs to be done, our sewer system was built back in 1800s. And so as you can imagine, our collection system needs work, the plants are in great shape, but we have to build some facilities to hold storm water, and then treat it later. We've done a lot, but there's a lot more to go.
Our residential bill is under $50 a month. We want to do small increases along the way instead of the bigger ones that we had to do in the past. We've got a more strategic plan, as long as it improves that we'll be able to stage those out over the coming years.
We're required to spend 2% of the household median income, that's a federal requirement. And so that's one of our negotiating tools is to look at that. If they move some of those big projects out farther for us to allow us to do that, then we'll have very small increases. But if they make us do some big stuff up front, we'll have to have a little bit larger increase.
I don't think we're gonna have to do anything until 2024. I really don't. You're gonna have to design the stuff that they approve, and we have money on hand to do a lot of that. And there's no reason to hurry up and raise rates when we don't need that.
Hren: I want to get a budget update to the end of 2021 general fund update. We've talked about tax anticipation warrant loans to meet a deadline, any update on that?
Bennett: We've reduced our borrowing. Just a few short years ago, we borrowed $9 million of short term loans. But we've reduced that now down to $2.5 million. And so we need a little cushion, because we don't get our big paychecks till May from property taxes. So the first six months of the year, always the toughest for any municipality unless you've got significant reserves.
At the end of this year, I'm hopeful that I'll have a 12% cash reserve on operating funds. That's the state's target. So we're right where we need to be. We ended the year pretty well about $3.4 million roughly in the general fund. There's some final adjustments to be made before the audit. So we've turned that around from a negative almost $10 million in 2015, to a positive $3.4 million just in the one general fund. But we've got 90 other funds, too. So all of them are doing much better. We're very solid ground financially.
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