A FINANCIAL PLAN FOR GARY, INDIANA Tonights Agenda City of Gary - PowerPoint PPT Presentation

A FINANCIAL PLAN FOR GARY, INDIANA

Tonight’s Agenda…  City of Gary – At a Glance  Review of History  Review of Plan

Measuring the Tax Burden Shift According to the Indiana Legislative Services Agency, there was a decrease in Lake County Industrial property taxes of $109.4MM and an increase in the Lake County Residential Property Tax Levy of $95MM between FY 2002-2003. Sources: Indiana Legislative Services Agency

Population and Property Taxes 140,000 • Indiana state passes new tax laws that shift City’s tax burden from industrial base to 120,000 residential base as a means to encourage 2003 industrial businesses to remain in Indiana. 100,000 • Property Tax Caps Approved -State 80,000 legislature passes laws to limit annual 2008 taxes 60,000 • Distressed Unit Advisory Board (DUAB) 40,000 Relief Granted to Gary – Gary is the only city in Indiana to take advantage of DUAB 2009 20,000 status. 0 • DUAB Relief Terminates – Gary must 1990 2000 2010 manage budget without direct relief from 2012 tax caps. Population

ASSESSED VALUES (in Billions) $2.3B $2.19B $2.17B $2.2B $2.17B $2.1B $2.06B $2.0B $1.98B $1.9B $1.89B $1.8B $1.7B 2012 2013 2014 2015 2016 2017

Primary ry sources of revenue include property and other taxes, , grants, and casino revenue 2017 Revenues (in Millions); Total: $110.9M Other Receipts; $7.7M Charges for Services; $5.2M Wheel Tax; $1.3M LIT; $9.5M Property Taxes; Permits, Licenses & $26.2M Fines; $1.5M Grants; $22.1M Other Taxes; $23.5M Casino; $14.0M

Property tax revenue is down 5 percent fr from 2012, , and 16 percent fr from 2014 PROPERTY TAX REVENUES (in Millions) $35M $31.4 M $30M $30.2 M $28.4 M $27.7 M $25M $26.5 M $26.2 M $20M $15M $10M $5M $0M 2012 2013 2014 2015 2016 2017

Casino revenues have fallen 35 percent since 2012 2012 CASINO REVENUES (in Millions) $25M $20M $21.4 M $19.1 M $15M $16.4 M $15.9 M $14.8 M $14.0 M $10M $5M $0M 2012 2013 2014 2015 2016 2017

OTHER REVENUE Local Road & Street 1,182,005 MVH 3,040,538 LDA Casino 7,178,378 TIF 4,531,635 ABC Excise Tax 30,921 Cigarette Tax 53,254 Financial Institution Tax 47,832 Aircraft Tax 1,540,713 Commercial Excise 389,757 ABC Gallonage 178,436 CEDIT 4,571,000 Building Community 73,784 (Police community service) Nat. Wildlife 187,719 (Grant Green Urbanism) Equal Opportunity Commission 27,300 Emergency Shelter Grant 249,149 (Grant Battered Women Shelter) Redevelopment Operating 104,663 23,387,084

1. Consolidated Area (Fund 823) – encompasses the majority of the Downtown Gary CBD and finances redevelopment projects therein including the 504 Broadway bank building rehabilitation, various demolition projects, City Hall repairs, Genesis Center and Hudson-Campbell modernization projects 2. Madison Townhomes (Fund 824) – finances a bond for affordable housing on Madison Street 3. Lakefront (Fund 826) – finances improvements to the areas adjacent to GYY and the industrial footprint, including infrastructure improvements and site preparation 4. Midwest Center (Fund 828) – intended to finance infrastructure improvements in the industrial footprint adjacent to I-65 at 15th Avenue 5. Lancaster Dusable (Fund 830) – finances the bond for a Lancaster Dusable project.

6. County Market (Fund 833) – finances the bond for a grocery store project on 25th Avenue at Grant Street 7. Dalton Arms (Fund 834) – finances a bond for an historic rehabilitation of a mixed-rate residential building on 5th Avenue in the CBD 8. Kenny’s Ribs (Fund 835) – finances a bond for an Empowerment Zone restaurant project on 5th Avenue in the CBD 9. Truck City (Fund 838) – finances a bond for a commercial truck dealership on 25th Avenue at Taft Street 10. Kirk Yard (Fund 854) – finances expansion of the Kirk Yard rail yard south of U.S. Steel.

11. East Lakefront (Fund TBD) – finances infrastructure improvements along US Highways 12 and 20, including the Lake Street commercial district, Miller train station, and Melton Road. 12. Northwest Indiana Industrial Complex (Fund TBD) – potential to finance a bond associated with the creation of light industrial, warehousing, and logistics park along Chase Street at 11th Avenue.

Over half of f expenses go towards employee wages, , health insurance, and infrastructure 2017 Expenses (in Millions); Total: $124.6M Property Insurance; $0.8M Gasoline; $0.8M Other Expenditures; Wages & Salaries; $31.9M Judgements; $0.8M $42.8M Supplies and Materials; $1.4M Debt Service Interest; $3.4M Health Professional Insurance; Capital Services; $4.4M $14.3M Outlay; $12.1M Utilities; $5.0M Contract Maintenance; $7.0M

Outstanding Debt 2012 Gary’s Balance Sheet Projected as of December 31, 2011 Description $ Obligation Potential & Outstanding $3,800,00 Judgments Outstanding Insurance Claims $2,200,000 & Utilities Outstanding Bonds – 5 th /3 rd $7,300,000 Bank (Excludes TAWS) Intergovernmental Liabilities – $7,800,000 GSD Internal Liabilities $11,400,000 Regional Development $6,800,000 Authority TIF Repayment – Majestic Star $3,800,000 Total Debt $43,100,000

Outstanding Debt in 2018 Gary’s Balance Sheet Projected as of December 31, 2011 Description $ Obligation Potential & Outstanding $1,000,000 Judgments Outstanding Insurance Claims $2,764,000 & Utilities Outstanding External Debt $5,400,000 (TAWS & LEASES) Intergovernmental Liabilities – $5,000,000 GSD Internal Liabilities $7,500,000 Regional Development 11,325,000 Authority Total Debt $26,239,000

UNAPPROVED TRANSFER OF EMS FUNDS - $8,160,403.37 USE OF DOLLARS AMOUNT PERCENTAGE GENERAL FUND $4,527,720.79 55% PAYROLL BLIGHT $1,285,478.86 16% ELIMINATION SPECIAL REVENUE $1,940,000 24% GENESIS, $407,203.72 5% REDEVELOPMENT,GLEASON, MARQUETTE, SECTION 108 Total $8,160,403.37 100%

REVENUES VS EXPENSES (in Millions) $148.6 M $160M $133.3 M $132.2 M $140M $127.5 M $124.2 M $124.6 M Expenses $120M $131.5 M Revenues $126.1 M $121.5 M $100M $110.9 M $110.1 M $108.4 M $80M $60M $40M $20M $0M 2012 2013 2014 2015 2016 2017

COST REDUCTIONS REDUCTION VALUE TARGET DATE $3,415,000 Centralization of $190,000 1/1/19 Procurement/ Purchasing Review of Personnel $200,000 1/1/19 Policy Change in $750,000 1/1/19 Healthcare Plan Reduction in $150,000 1/1/19 Professional Service Contracts/Fees Reduction in $1,500,000 1/1/20 Footprint of City- Owned Buildings Consolidation of $450,000 1/1/19 Departments/ Functions

REVENUE GENERATION SOURCE OF DOLLAR VALUE TARGET DATE REVENUE Legislative Changes $3,750,000 1/1/20 Licensing, Fees, & $640,000 6/15/19 Permits Collection of $800,000 1/1/20 Outstanding Fines & Fees Damage Recovery $100,000 1/1/20 Total $5,290,000

ONE TIME INFUSIONS SOURCE OF DOLLAR VALUE TARGET DATE REVENUE SALE/LEASEBACK $25,000,000 9/1/18 SALE OF SURPLUS $2,100,000 1/1/19 PROPERTY NEW TBD 1/1/20 DEVELOPMENT PROPERTY TAX TBD 7/1/19 AMNESTY HIRING FREEZE $125,000 PER PAY CURRENT PERIOD COURT AMNESTY TBD 9/1/18

MYTHS • GARY RECEIVES $200,000,000 IN REVENUE ANNUALLY • THE MAYOR HAS AN UNLIMITED PROFESSIONAL SERVICES FUND • HIGH SALARIES DRIVE DEFICIT