Sunday, May 31, 2009

CIB's Plan B

I awoke to find the newest Brendan O'Shaughnessy Indianapolis Star article on a possible Capital Improvement Board bailout, which O'Shaughnessy, for some reason, has started referring to with the spin term "rescue." I thought there were some interesting developments in the article.

Afterward, I went to Advance Indiana to find Gary Welsh's take on the subject. While Welsh, as always, hits on a number of interesting points on the article, I have a slightly different take.

First, we continue to get dishonesty from the CIB folks. Obviously CIB President Bob Grand has a Plan "B" and open government behooves that it be shared with the public. Grand though doesn't share it because he prefers to concentrate on the proposed shakedown of taxpayers as the solution. Another part of the dishonest CIB public relations campaign is revealed when Ryan Kitchell, director of the Indiana Management and Budget, noted that if the CIB could no longer operate Lucas Oil Stadium, the State would quickly take it over without interrupting schedule events. Weren't the CIB folks talking about LOS getting shuttered and events having to be canceled? The fact that the CIB has an agenda which does not involve telling people the truth is yet more reason to investigate the operations of the CIB and demand reform. I totally agree with Welsh that we should not simply accept the CIB's word on things, such as the claim that the Board is $47 million in the hole. The Board's leaders don't exactly have a track record of being open and honest with the public.

I would note that near the end of the article, David Reynolds, the city controller, does trot out the dishonest spin about having to put convention events on hold if the bailout doesn't go through.

Second, it was interesting to me that the state folks did not seem opposed to taking over the operations of LOS from the CIB, even sort of expected it to happen. That of course has been Welsh's suggestion all along. He had proposed that the CIB simply give LOS back to the State since the state building authority actually owns the building.

Of course, even the removal of the LOS headache still would leave the CIB in a claimed $27 million hole, which of course includes the $15 million annual charge for the CIB, without even taking a vote, agreeing to pick up the Pacers expenses of running Conseco Fieldhouse.

My choice, bankruptcy, was also discussed seriously for the first time. I thought it very significant that Deputy Mayor Paul Okeson said that "bankruptcy is an option" as a backup for the CIB. Never before have I heard an administration official make that common sense proposal.

The article talks at length about Senator Mike Delph's suggestion regarding Chapter 9 bankruptcy for CIB. He quite validly points out that it putting the BK option on the table changes the balance of power from the Colts and Pacers to the Mayor and the CIB. The CIB/City would be in a position to extract common sense concessions from the teams or face having a BK judge rewrite the contracts. While it's true that the teams could walk away at that point, those teams are unlikely to get the sweetheart deal they got in Indianapolis from other cities, especially in today's economy. It would rather be in their best interests to engage in reasonable concessions that would allow the CIB to make more off the buildings in order to cover operating costs.

There is, however, a problem with Sen. Delph's use bankruptcy at the very least as a negotiating tool proposal, a proposal I strongly support. The problem is who would be negotiating with the Pacers and Colts to extract concessions. I would have concerns with the current CIB leadership being involved in negotiations. These are the people who, after all, decided to pick up all $15 million of the Pacers' annual operating costs for Conseco Fieldhouse (a building on which the Pacers get 100% of the revenue) at a time when the Board claimed to be in a $32 million a hole. I would add that a Pacers spokesman has said the team didn't even ask the CIB for the money. Yet the CIB and Indianapolis Mayor Greg Ballard still insist on going through with the plan to pick up the $15 million annual operating cost.

In short, the City and CIB's leaders, under both Democratic and Republican administrations have proven themselves to be dreadful negotiators when it comes to the professional sports teams. While Bob Grand, may or may not have what it takes to be a tough negotiator, his personal self-interest is not to protect the interests of taxpayers, but rather to continue the CIB corporate welfare gravy train that not coincidentally will directly benefit his client, the Simons, who own the Pacers.

Finally, I do note with amusement the continued argument by the leaders of the Indianapolis Convention and Visitors Association that the uncertainty over the bailout is being used against Indianapolis in marketing materials produced by other cities. I would love to see those alleged marketing materials. Nonetheless, even if they do exist, do the leaders of the ICVA , the CIB, and Mayor Ballard not realize that raising taxes even further, giving Indianapolis nearly the highest combined hospitality tax in the country, will be even a better marketing weapon for those cities to use against Indianapolis?

Addendum: I do love the headlines the editor used for the article:

CIB has no 'Plan B' should it go broke
President says he's too busy finding a solution to agency's financial ills

Saturday, May 30, 2009

Wall Street Journal Details Lavish Expenditures By Federal Lawmakers

Bob Segal of WTHR-TV Channel 13 has recently done a couple of excellent reports detailing the lavish expenditures of our Indiana state agencies. First, it was the piece on overpriced furniture, "State of Your Money: Sitting on Tax Dollars" which I blogged about. Then it was the trinkets and other items state agencies have been allowed to purchase in "State of Your Money: Taxpayer Trinkets."

Well, now the the weekend edition of the Wall Street Journal has an interesting article detailing the expenditures of our federal lawmakers:

WASHINGTON -- Florida Rep. Alcee Hastings spent $24,730 in taxpayer money last year to lease a 2008 luxury Lexus hybrid sedan. Ohio Rep. Michael Turner expensed a $1,435 digital camera. Eni Faleomavaega, the House delegate from American Samoa, bought two 46-inch Sony TVs.

The expenditures were legal, properly accounted for and drawn from allowances the U.S. government grants to lawmakers. Equipment purchased with office expense accounts must be returned to the House or the federal General Services Administration when a lawmaker leaves office.

.....

U.S. politicians, unlike their counterparts in Great Britain, can't bill taxpayers for personal living expenses. The U.S. Treasury gives them an allowance to cover "official and representational expenses," according to congressional rules, and the lawmakers enjoy a fair amount of discretion in how they use the funds.

The Senate and House release volumes of the reimbursement requests for these allowances, but do not make them available electronically. A Wall Street Journal review of thousands of pages of these records for 2008 expenses showed most lawmaker spending flowed to areas such as staff salaries, travel, office rent and supplies, and printing and mailing.

But it also turned up spending on an array of products, from the car leases and electronics to a high-end laptop computer and $22 cellphone holder. Rep. Howard Berman expensed $84,000 worth of personalized calendars, printed by the U.S. Capitol Historical Society, for his constituents. A spokeswoman for Mr. Berman, a California Democrat, didn't return requests for comment.

The records show that some lawmakers spent heavily in the final months of the year to draw down allowances before the end of December -- a time when U.S. households were paring their budgets and lawmakers were criticizing Detroit auto executives for taking private aircraft to Washington to plead their case for taxpayer funding.

Rep. Hastings, a Democrat, and Rep. Turner, a Republican, made their purchases in the third quarter. Rep. Faleomavaega, a Democrat, bought the TVs for $1,473 apiece in mid-November. Spokespeople for the three didn't return requests for comment.

House members get a government expense allowance of $1.3 million to $1.9 million a year. Senators get $2.9 million to $4.5 million. The disparity is based on several factors, with lawmakers whose home states are far from Washington, for example, typically receiving more to cover their higher travel expenses.

If lawmakers don't seek reimbursement for all of their allowance money for the year, the remainder doesn't roll over to the next year, but stays with the Treasury. The review showed that the increased year-end spending went not nly toward equipment but also to fund year-end "bonuses" to aides. The average House aide earned 17% more in the fourth quarter of the year, when the bonuses were paid, than in previous quarters, according to an earlier Journal analysis. Payments ranged from a few hundred dollars to $14,000.

...

Even so, the accounts aren't easy to view or parse. House lawmakers submit receipts and records to the chief administrative officer, who publishes a statement each quarter that runs more than 3,000 pages. Each member's expense ledger takes up about six pages and includes a short description of each expense, its amount and the date incurred. The Senate publishes two volumes every six months, with descriptions that are less detailed than those published by the House.

Members of the public can request specific receipts, but lawmakers aren't required to provide them. Officials said they are exploring the possibility of publishing the information electronically but have no immediate plans to do so.

"This information is not widely available to the public," said Steve Ellis, vice president of the nonpartisan Taxpayers for Common Sense. "This is stuff that every constituent should be able to know."

The House and Senate administrators can deny reimbursement if they deem an expense request to be inappropriate. Jeff Ventura, spokesman for House chief administrative officer Daniel Beard, said no formal records are kept on the number of claims deemed inappropriate, but that such instances are rare. The Senate operates similarly.

Staff salaries are the largest cost in most members' budgets, according to published details. Travel is another big cost center, with many lawmakers claiming funds for commercial air or train travel to and from their district, and for mileage on their cars or personal planes while they are there.

...

The records show several examples of spending on high-end electronics.

Rep. William Jefferson, a Louisiana Democrat, spent $2,793 on a Panasonic Toughbook laptop, which is marketed to the military, in September, about three months before he lost his re-election bid in a December runoff. A lawyer for Mr. Jefferson, who is facing an unrelated federal bribery trial, declined to comment.

....

Many lawmakers don't spend their full allocation. House Speaker Nancy Pelosi (D., Calif.) had about $57,000 remaining in her budget at the end of 2008. House Minority Leader John Boehner (R., Ohio) had $228,000.

It should be noted that Alcee Hastings was a federal judge before being elected to Congress. He is one of a handful of judges in the 220 years that has been impeached and removed from the federal court. The grounds for his removal was corruption and perjury.

Read the full Wall Street Journal article Lawmakers Bill Taxpayers for TVs, Cameras, Lexus (5/30/09)

Read related Wall street Journal article Lawmakers Have Long Rewarded Their Aides With Bonuses (04/01/09)

Friday, May 29, 2009

CIB Bingo

Click to Enlargen


Probation Revocation For Drinking a Beer

During the past several decades, we have locked up an increasing number of people in this country. As a result, more jails and prisons have had to be built, with taxpayers footing the bill.

Obviously the "war on drugs" has played a role in the increased incarceration of Americans. Many reformers suggest that the "war" has been counterproductive and suggest treating drug offenses as more of a public health issue, than a criminal issue. They suggest that decriminalizing things such as marijuana possession would reduce the need for more jail cells.

While taking a look at that issue has some merit, what about the criminalization of LEGAL behavior that leads to re-incarceration?

Let me explain. Many people do not know that courts routinely impose probation conditions that require that those released abstain from alcohol consumption. It does not matter if the offense that led to the probation had anything to do whatsoever with alcohol consumption. If you were convicted of bouncing a check, receiving stolen goods, etc. you could well end up on probation with one of the conditions being that you can't consume alcohol. As a result, it you drink a beer and end up with a surprise urine test the next day, you will quite likely find yourself back in jail.

Many of the probationary periods are quite long. I know one person convicted of theft, who is out on two years probation. He had a couple of beers after a long day of work. Now he is looking at another 15 days in jail. His criminal history shows no abuse of alcohol whatsoever.

You would be shocked by the number of people incarcerated for daring to have a drink while on probation.

Judges should not be imposing alcohol restrictions on probationers when the offense have nothing to do with alcohol consumption. Taxpayers are footing the bill when these individuals get sent back to jail.

Thursday, May 28, 2009

At Center Township Mayor's Night Out, Indianapolis Mayor Ballard Proposes Three Part CIB Fix: Taxes, Taxes and More Taxes

At the Center Township Mayor's Night out held on May 12, 2009 at the Mount Zion Apolostic Church, Indianapolis Mayor Greg Ballard was asked what other options he is considering besides tax increases to bailout the CIB. His answer? He had none. His only supposed non-tax proposal, expanding the professional sports tax district, simply amounts to diverting tax revenue from other government services to the CIB, revenue that will likely have to be replaced by, guess what? More taxes. His other proposals? Raising taxes he said would only affect out of county people attending events at Lucas Oil Stadium or Conseco Fieldhouse - taxes on rental cars, hotel rooms and event tickets. Huh? Okay, I get the ticket tax argument, but the hotel and rental car tax? Mayor Ballard insists that in order to save the hospitality industry we need to raise hospitality taxes, giving the city one of the highest combined hospitality tax rates in the country. Logical, that isn't.

Ironically, the Mayor admitted that even if he got all the expanded professional sports district and tax increases he wants, the CIB would still be $15 million short. The CIB has built into its alleged $47 million deficit, the assumption that the CIB will starting picking up the Pacers $15 million in annual operating costs for Conseco Fieldhouse, even though the team claims it didn't ask for the money and doing so is not at all required by the existing Pacers-CIB contract. It was the perfect opportunity for the Mayor to stand up for taxpayers and say that they should not be saddled with this expense on a building in which the Pacers are getting all the revenue. Of course, the Mayor didn't do that. Instead he proposed expanding the professional sports district even more to close the gap.

Making the transcript of the exchange, it is remarkable how out of touch this Mayor is with public opinion. He seems to believe if he keeps repeating his untruthful spin enough times, people actually will start believing him. It is not working.

The exchange is at about 57:15 on the recording:
Q: In view of recent CIB funding shortfalls, what other alternative funding options are being considered other than tax increases?

Ballard: Alright, the real story here is, there is a huge shortfall. I’m sure you know the numbers…47 million dollars. Here’s what we’re proposing to do…here’s what we want to do. The CIB has already got $10 million. And please understand, we have to fix this. This is about the convention business. Employs a LOT of people in the city. In my opinion, we absolutely have to fix this. Alright, just understand this, where I’m coming from. Because otherwise we are set to unload a chain of events that none of us want to see. The buildings were built, the convention center is being expanded and I’m not here to point fingers and you’ll never heard… see me pointing fingers. All I’m telling you is we have to fix this. Okay. There is no, the operating budget is not here… to make this work. That’s just the way it is.

So, the CIB has got about $10 million, somewhere between $8 and $10 million. There is a couple options we’re exploring at the statehouse, an expansion of the professional sports district area and that’s really what we’re trying to do the most. I think everybody in Marion County, certainly everybody on the council is that is the primary people trying to fill the large gap, an expansion of that area, which means that we get the tax revenues out of that area as opposed to going to the state and that’s not real popular with other parts of the state as you can probably imagine, alright, and most people in the state legislature are not from Marion County. So we have PSDA of City of Indianapolis and asked them to expand it to at least the TW Marriott and there is general agreement that will happen and we are asking them to expand that more.

Other than that there are a couple other options out there that we’re exploring. All that said, this is kind of a given that the three taxes here in Marion County don’t really affect Marion County residents directly unless you use the facilities – car rental tax, innkeeper’s tax, and admissions tax for events at Lucas Oil Stadium and Conseco Fieldhouse and like. So those are the three we are working with at the State and Marion County is willing to put on the table. We have to make sure the Council will agree with that obviously but the State is kind of counting on that. But there is still a gap in there of about $15 million dollars after all of this. And it has to be filled. And we’re hoping to get it filled by an expansion of the professional sports district area and if that doesn’t happen there is a couple other ways to go about that and we’ll unveil all of that next week so everybody knows, no secret. No secret. But I’m here to tell you, from my viewpoint … absolutely critical. Critical. Tens of thousands of jobs are at risk. Future. Understand that.

Wednesday, May 27, 2009

Tony George Removed as IMS Chief?

Certainly big news.

Inside Indiana Business reports:

The board of the Indianapolis Motor Speedway (IMS) has apparently voted to remove Tony George from his role as IMS chief executive officer. SPEEDtv.com reports the decision was made during a board meeting Tuesday night. George will continue as CEO of the IndyCar Series.

The report suggests George's sibilings, who are on the board, have been concerned about the amount of money being spent on keeping the Indy Racing League afloat and changes to the track.

Speedtv.com says the IRL founder has spent more than $600 million during the past 13 years.

One name being mentioned as a possible replacement is Humprey Wheeler, who is the promoter for the racetrck in Charlotte.

He attended last weekend's Indianapolis 500 for the first time since 1970.
See Sports Illustrated's longer report on the alleged firing here.

Indianapolis Star reports that Tony George is denying the story. Read it here.

Wow, if Tony George was fired by his sisters and mother, I'd hate to be at their next family reunion.

Teddy Roosevelt Revisited - A Model for the New GOP?

During the blogger panel at the Washington Township GOP Club meeting yesterday, I remarked that I think given the historical times we live in, Republican Teddy Roosevelt is a better role model for the future of the Republican Party rather than Ronald Reagan, who I also see as one of the greatest President who ever lived, certainly the greatest in my lifetime.

I had written on the subject of Teddy Roosevelt before:

Back to the Future: Why the Success of the Republican Party Rests on Reviving the Legacy of Teddy Roosevelt (12/16/2008)

One of the audience members rightfully pointed out a problem of the Teddy Roosevelt legacy that I would not approve - namely an overall expansion of the power of the federal government. I also noted that I would also not approve of TR's interventionist foreign policy. However, from a historical perspective, the times today are similar to the times back then. TR did a lot of things right when confronted with a monopolistic economy and a corrupt political system. As I noted previously in my 12/16/2008 post:
I think those who argue a return to Reagan-type politics are correct that President George Bush II's policies have strayed far from those limited government principles advocated by Reagan. What they are not right about is their argument that Reagan conservatism would sell in the early 21st Century or is what is needed at this point in history. Historians will tell you that great Presidents are those who provide the country exactly what it needs in a particular point in our nation's history. The calm presence of Washington was perfect for the country's early days. Lincoln's strong leadership was what the country needed in the Civil War. FDR's optimism was critical to the nation surviving the worst depression in our nation's history.

As much as President Reagan was the perfect President for the 1980s, Republicans would be wise to turn the pages of history back further to another great Republican President of the 20th Century, Teddy Roosevelt, as an example of what is needed today. TR was a man who fought tirelessly against entrenched business interests which then controlled the nation's economy in the form of trusts and other monopolies. He was a crusader against government corruption and took it on even when doing so stepped on the toes of fellow Republicans. TR did not get ahead bowing to the interests of party bosses and big money. He succeeded by pursuing reforms which, while not popular with powerful interests of the time, were enormously popular with the people. TR is the populist, reform-minded candidate model that Republicans should look for as they seek to find a winning formula.

While the challenges of today are slightly different than in TR's time, they demonstrate the need for a Teddy Roosevelt. In TR's day the issue was whether government should intervene to correct the concentration of wealth in a few large companies that dominated the economy. Today's challenge is that government has grown much larger than in Teddy's day and has become a tool to funnel taxpayer money to large powerful business interests that often kick back some of that money in the form of campaign contribution and other "benefits" to the government officials making the decisions on where the taxpayer money goes. Corporate welfare, as it is known, has grown to dominate much of government policies. Indianapolis is a perfect example of a community where policy development has become dominated by wealthy business interests and the taxpayers' interests are secondary at best. Private-public partnerships and privatization (which is a good idea horribly managed in practice) has become a tool to channel our tax dollars to big companies.

When government gets involved picking winners and losers, rewarded by our tax dollars, we have the makings of an inefficient economic system and a government that is ripe for corruption. We see an example of what happened in Illinois with the scandal surrounding Governor Rod Blagojevich and his pay-to-play schemes. What I find disheartening though is how people assume what the Illinois Governor did is that much different from what is going on in states and cities across the United States. Pay-to-play politics is the norm. The only difference between what Governor Blagojevich did and what is going on elsewhere is that Governor Blagojevich brazenly made transparent what everyone else in politics is smart enough to not mention out loud - that there is a quid pro quo when there is taxpayer money handed out to private business interests. Politicians expect something in return for the taxpayer dollars they send to big companies. Make no mistake about it.

If Teddy were around today he would have railed against the corruptive influence corporate welfare has has on government policy and how it has damaged free market competition so essential to the success of our capitalistic system. TR would have stood squarely for good government reforms that both parties thus far have fiercely resisted. If the Republican Party wants a model for how to succeed in today's political environment, they might turn back the pages of history and study that other great Republican President of the 20th Century, Teddy Roosevelt.
As we look back in history for role models for the future, we shouldn't endeavor to copy 100% of what our political heroes did. Even the great Ronald Reagan, rightfully revered by my fellow Republicans, was not perfect. Whether it is Reagan, Teddy Roosevelt, Abraham Lincoln, etc., let's use what they did that worked and discard what didn't work.

Returning though to the premise of this piece, the times call for a Teddy Roosevelt style populist reformer, a Republican who will tackle the monopolistic economic system (remember the "too big to fail" companies?) that has sprung up and which dominates the political process leading to the current taxpayer bailouts. We need a GOP reformer who is willing to take on the new welfare - welfare for the rich - even though it is the rich who generally patronizes the Republican Party. We need someone who will not back away from going after corruption, of either party, and who will advocate for a more ethical and accountable government.

While that GOP reformer is spoken in a singular, we Republicans need these Teddy Roosevelt style reformers at every level of government. We need to recapture the populist part of the being a Republican. The way to do that is by revisiting the legacy of the great reformer, Teddy Roosevelt, and the battles he waged at the nation entered the 20th century. TR provides the blueprint for Republican success in 2009 and for decades to come.

Bailout Out the Capital Improvement Board; Does the General Assembly Assist in Political Suicide?

In a matter of weeks, the focus will be on the Indiana Statehouse as the legislature returns to fulfill its legal responsibility of passing a budget. It appears that the budget bill will include a Capital Improvement Board bailout, or perhaps more precisely, provisions allowing the Indianapolis City-County Council to vote for new tax increases to channel more revenue toward the CIB.

While lumping the CIB bailout into the budget bill is going to make it much more likely to pass than it would as a stand-alone provision, one wonders if any CIB provision that requires the Council to raise taxes has any chance of passing that closely divided body.

The spread on the Council now is 15 Republicans, 13 Democrats, and 1 Libertarian. It's a safe bet that Libertarian Ed Coleman won't support any CIB tax increases. Democrats, while not necessarily opposed to tax increases, remember well the fact that the Greg Ballard is the Mayor because he ran against then Mayor Bart Peterson's COIT tax increase and is unlikely to want to help the Mayor out of the crisis by voting for taxes themselves.

With Republicans, even with the Coleman defection, still a majority on the Indianapolis City Council, the GOP could pass the CIB tax increases by themselves. To do so though, the Mayor would need 100% support from Republican council members for the tax increases. The political capital the Mayor would have to extend to get every last Council Republican to go along with the tax increases - a vote that would doom many of their political fates - would be extraordinary. Let's see that the Mayor does a superior sales job and gets 75% to go along with possibly a career ending tax increase, that still leaves the Mayor three votes short of a majority. Those three votes would have to come from Democrats. I shudder to think what backroom deals would have to be cut for those three Democrats to cross over. The one thing that works in the Mayor's favor on that score is that the Democrats actually want the Mayor to succeed in his plan to raise taxes so they can use that as a lethal club against him and Council Republicans in 2011. It is possible that the Democrats will send the Mayor a few votes to make sure he's successful in his suicidal efforts.

Thus, I'm not sure it's even wise for the legislature to include in the bill options to let Indianapolis raise taxes. Doing so is akin to buying a gun for someone who is suicidal. Mayor Ballard is determined to commit political suicide by raising taxes to bail out the CIB and take out Council Republicans with him. Why should Republicans in the General Assembly assist in helping Mayor Ballard do that, especially when he doesn't appear to have the votes on the council to pass the tax increases anyway?

That returns to the notion of other bailout options that may not require the Council to pass tax increases. Unfortunately an expansion of gambling is being pursued as an option. Indiana now ranks only behind Nevada when it comes to tax revenue derived from gambling. That is astonishing when one considers that it was only a couple decades ago that Indiana adopted a lottery, after years of prohibition on gambling in the state. One of the problems with the gambling ( I refuse to call it "gaming") option, and there are many, is that the State is already at the saturation point. Any expansion of gambling into Indianapolis generally only involve slicing the pieces of pie in smaller slivers. Another option being floated is to not expand into Indianapolis, but to allow table games at the Shelbyville and Anderson racinos, with some of the revenue channelled toward a CIB bailout. That, however, would cut into the French Lick casino business, so I'm sure that the owner of that casino, the Cook Group, would have to be placated.

If we think lobbying money has corrupted Indianapolis politics now, just wait until gambling lobbying money starts hitting the pockets of local politicians.

All the aforementioned approaches though belie the real problem with the CIB, which is that the Board has heavily subsidized professional sports, and insists on expanding those subsidies despite the fact that it is deeply in the hole financially and is begging for a bailout. It is truly remarkable that the CIB, the Mayor, and even the Council Democrats are determined to pick up $15 million a year for the Pacers in Conseco operating costs when in fact the Pacers have publicly said they never asked for the money and the CIB has absolutely no legal obligation to give the Pacers the money. If successful, we taxpayers would be paying the cost of running Conseco Fieldhouse while the Pacers get all of the revenue off of the building.

Any measure dealing with the CIB needs to include a requirement that the Board's past practices be investigated and that the CIB be reformed so that these mistakes never happen again. It is clear from the CIB's latest folly - the $15 million proposed annual gift to the Pacers - that it is not going to reform itself. The Board needs a major shakeup not only in terms of personnel, but in terms of its statutory authority. The CIB should not be in the business of handing out grants to various interest groups, such as Black Expo, the Arts Council, etc. Those groups should be going through the elected body, the Indianapolis City County Council.

Likewise, in special session, the legislature needs to put the bankruptcy issue into play by granting authority to the CIB and the City, to put the Board into bankruptcy. I still perceive reorganization bankruptcy as the best option for the CIB out of its current mess. But at the very least, the legislature should bestow on the CIB the option of bankruptcy, which would then give the Board a weapon to force the Pacers and Colts to the bargaining table, where concessions can be extracted from the teams, concessions that could alleviate the need for a taxpayer funded bailout. Of course, this remedy presupposes the CIB will have better negotiators than it has had in the past.

As the legislature special session nears, so to does the battle over the future of the CIB and Indianapolis politics. At the least, it should be interesting.

Tuesday, May 26, 2009

Washington Township Blogger Panel - The Future of the Republican Party

Tonight I am participating in a blogger panel at the Washington Township GOP Club meeting. The other panelists are Gary Welsh of "Advance Indiana," Sean Shepard of "Shepard on Politics and Policy," and Josh Gillespie of "Hoosier Access."

Liz Karlson, President of the Washington Township GOP Club, is to be commended for putting on the event. Having attended hundreds of these GOP club township meetings, it's nice to see a club president try to provide an informative program where alternative ideas can be discussed. In the past GOP club meetings have too often become nothing more than pep rallies for the troops. As a Republican activist and former township GOP club president myself, I know that the people attending these meetings want to discuss ideas and even debate those ideas.

While some might oppose the inclusion of Shepard, a libertarian who ran for Congress in 2008, the fact is the local Republican Party would be wise to listen to the Libertarians. Some of the brightest minds and most committed individuals are in the Libertarian Party. Although the Libertarians have never been able to garner more than a single digit when it comes to percent of the vote in Marion County, the fact is that that single digit could be the difference between victory and defeat. Many of the Libertarian ideas of limited government, low taxes, etc., fit well with Republican ideology. Unfortunately, Republicans too often don't live up to these principles they often campaign on. For example, see Mayor Ballard's strong and relentless support for tax increases to bail out the Capital Improvement Board.

If this blogger panel is about anything, it needs about the willingness for the party to be more open to discussing alternative ideas and debating the issues. That has not been the history of the Marion County Republican Party. Exhibit A is the fact that even though the CIB bailout and possible tax increases has been on the front page of the paper for months, not a single Republican council member has felt secure enough to publicly address the problems with the CIB. I have talked to several council members who fear retaliation if they speak their mind on this and other city business. That shouldn't be the case.

The last baseline mayoral election the Republicans won was in 1995 when Steve Goldsmith was re-elected. The difference between 1995 and 2009 are substantial. In 1995, the Republicans had approximately a 55% base line vote in the county. Today, the baseline is about 44% and the low profile county-wide races of 2008 would suggest it could be as low as 40%.

My limited math skills tell me that Republicans cannot win a majority in Marion County by starting at 44% and subtracting. It just can't be done. Yet that is exactly the strategy that is being pursued. For the Marion County Republican Party to operate as if this were the 1990s, employing the same 1990s people with the same 1990s strategy, is fool-hardy. The numbers simply aren't there.

The rank and file of the Marion County Republican Party is open to new ideas. There is an untapped energy among county Republicans that that needs to be unleashed. Leadership needs to get over the notion that everyone in the party must walk in lockstep, or at least publicly appear to do so. Retaliation against elected officials or party workers for daring to speak their mind should not be tolerated. Yet it still goes on in 2009.

The times, they are a chagin.' It's time for the Republicans to adopt to the new political landscape or find themselves permanently a minority party in Marion County.

Saving Courthouse Records - A Cause Worth Pursuing

Earlier I posted about the courthouse fire in the town I grew up in - Madison, Indiana.

It turns out that the fire may have destroyed more than the roof of the building. Associated Press quotes county attorney Will Goering:
"There's no loss of life, just a lot of things and the building will be restored so we'll move on and it will be better for the next 200 years," Goering said.

As of Thursday afternoon, he said county officials had not yet been allowed into the courthouse due to the continuing investigation by the state fire marshal and others.

But he expects many of the courthouse's store of documents -- including deeds, marriage and divorce records, adoption records and genealogy documents -- were damaged or destroyed by flames or the water firefighters poured on the building to save it.

"There's several feet of water in the basement and that's where a lot of the records were stored," Goering said.

Officials from the state archivist's office will be helping in efforts to salvage those documents, many of which date to the early 1800s.

Among the items Goering fears were lost is a book signed by every attorney who ever practiced in the county. That book was kept in the circuit court on the gutted third floor.

"We'll have to see if we can locate that book. It's that sort of thing that will be irreplaceable," he said. "There are certainly many relics and documents we'll never recover."
The sad fact is we have records in courthouse across the state that are every bit as vulnerable as those records that were destroyed in the Jefferson County Courthouse fire. Years ago I was told by a Marion County Clerk that most of the records in the basement of the City-County Building are not backed up. She was concerned that a fire could wipe out those documents. However, she said she simply did not have the funds to hire people to copy the paper documents to an electronic format.

Fires, floods, and tornadoes can easily wipe out paper records forever. If you look back at the history of Indiana courthouses, you will find many occasions when fires in those buildings destroyed public records. Today with technology, it is possible to make an electronic copy of those documents, storing the copies in an alternative location so a disaster won't wipe out the history of our Hoosier ancestors and the lives they lived. A project to copy these documents electronically is a project that the State should consider pursuing.

Sunday, May 24, 2009

Rep. Jacque Clements's Conflict of Interest: What Happens When Laws Are Not Enforced

Both Josh Gillespie of Hoosier Access and Gary Welsh of Advance Indiana have excellent reports on conflict of interest troubles faced by Rep. Jacque Clements, a Republican from Clinton County. In short, Clements who had been Auditor of Clinton County, was employed by software vendor Manatron when she was selected at a Republican vacancy in 2004 to fill out the remainder of a state representative's term. She was subsequently re-elected in her own right.

Allegedly in 2004, Rep. Clements failed to note her employment with Manatron, which company received a contract with her Auditor's Office for tax billing software. That contract expired in 2007. Clements, elected to her state representative position, began working part-time as a Deputy Clinton County Auditor (she has since been terminated for allegedly misusing the county's email system.) By the time the Manatron contract ended in 2007, Rep. Clements had begun working for a company, Nikish, which was started by former Manatron employees. While employed by Nikish, Rep. Clements then acted on her own to negotiate a contract with Nikish that would allow the conversion of the Manatron data. A lawsuit filed by the county suggests that the Nikish software is non-compliant with state requirements and the county has incurred damages in having to reconvert the data for Manatron.

I'm not sure it would qualify as a "revolving door" problem since the allegation is that Rep. Clements was simultaneous employed by local government and, perhaps surreptitiously, the private vendors with which government was contracting. Certainly though it appears to be a case of a conflict of interest gone haywire.

While the alleged Clements' conflict of interest situation may appear to be extreme, certainly there are plenty of other examples of similar conflicts of interest all over the state. The growth of privatization has opened the door to government contractors, wanting to curry favor with government, shoveling jobs and money to past and present government officials as well as their family members.

In some cases, Indiana has insufficient laws to deal with such conflicts of interest. In other cases, we have law enforcement officials and county prosecutors who are simply uninterested in enforcing conflict of interest laws, especially when doing so might result in the prosecution of political allies. Public officials, seeing laws not being enforced, continue to push the conflict of interest envelope to even more brazen levels.

In addition to better and more strict conflict of interest laws, the Indiana General Assembly needs to consider giving the power to prosecute these white collar political crimes to someone other than the local county prosecutor. The Attorney General is an obvious candidate for such authority. Likewise, what would help is if President Obama appoints a U.S. Attorney for the Southern District who is aggressive about going after white collar crime and public corruption. Let's keep our fingers crossed. Hopefully the Clements' case will spark much needed changes.

Friday, May 22, 2009

Republican Chairman Uses Hamilton County Resident to Strong Arm Marion County GOP Precinct Committeemen

With nearly a million residents in Marion County, many of whom are Republican, one would think Marion County GOP Chairman Tom John would not go outside the county to find an Area Chairman for the county organization.

Think again.

Long time Marion County Republican activist and former Pike Township resident David Brooks has admitted to people in the organization that he moved to Hamilton County some time ago. Did that end his role in Marion County GOP politics? Nope. Chairman John has continued to keep Brooks on as Center Area Chairman, leaving him in control of key precincts in southern Washington and Center Townships.

I know David Brooks very well from Pike Township politics, including time I spent as a Ward Chairman when he was a Township Chairman. On a social level, Brooks is a very likable guy, the kind of guy you want to have a beer with. As a political operative though, Brooks is little more than a political hitman for whoever is in power, dutifully carrying out orders no matter the ethos of those orders. Brooks will not hesitate to twist the arms, threaten, cajole or replace precinct committeemen who do not carry out the wishes of the GOP leadership employing his services. In the past, Brooks, an attorney, has been handsomely awarded with city legal business for his political efforts.

Complaints are rolling in from State Senate District 30, which falls partly into the Center Township Area managed by Brooks, that the Hamilton County resident is busy twisting arms and filling positions in an effort to rig the upcoming vacancy caucus election in favor or Councillor Ryan Vaughn. As far as the candidate field goes, Scott Schneider has a conservative independent political mind. Chris Douglas I'm sure is considered a maverick. John Ruckleshaus is experienced and has been in the legislature before. But Ryan Vaughn? His youth and inexperience make him the perfect candidate for manipulation by party leaders, someone they can control and who will do the party bosses' bidding upon request.

I do not see why a Hamilton County resident should be be part of the Marion County GOP organization, much less in a leadership role. For John to allow Brooks, someone who lives in Hamilton County, to supervise the work of locally elected precinct committeemen who represent their Republican Party in Marion County neighborhoods is bad enough. But to allow Brooks to be involved in twisting the arms of local precinct committeemen to try to get them to elect the party bosses' favorite is unconscionable.

I have a couple really simple questions for GOP Chairman Tom John. Why is a Hamilton County resident acting as a Marion County Area Chairman? And, second, when is David Brooks going to be removed from his position within the Marion County organization since he no longer lives in Marion County?

Indianapolis Mayor Ballard Organizing Forces for Re-Election?

Over at Hoosiers for Fair Taxation, tax activist extraordinaire Melyssa Donaghy reports that she received a call from a campaign staffer for Indianapolis Mayor Greg Ballard who asked her to work on his re-election effort. He noted that he had targeted her as a potential volunteer since she had worked on Ballard's 2007 campaign. I feel sorry for the poor sap who unwittingly made that call. I can imagine the earful he received from Melyssa.

In fact, if you want to hear complaints about Mayor Greg Ballard, you'll get your worst response from his 2007 supporters who were completely led astray by his populist campaign, including his claimed opposition to tax increases and support for an ethics agenda, all of which Mayor Ballard immediately abandoned upon taking office. It is those folks, who supported him when nobody in the GOP establishment would, who rightfully feel betrayed and are extremely angry at the Mayor.

As a 23 year activist in the Marion County Republican Party, I hope I get a call about supporting the Mayor's re-election. The answer might even be more negative than Melyssa's. Mayor Greg Ballard has sold out everything I believe the Republican Party should stand for and has put MY party on the path to a disaster in 2011. No way, no how will I support him for re-election.

The Difference Between No Leadership and Bad Leadership: The Democrats' Campaign Message Against Indianapolis Mayor Greg Ballard

There is no doubt what the theme of the Democrats' message against Indianapolis Mayor Greg Ballard over the next 2 1/2 years. Quite simply it is "Lack of Leadership."

Over at the Indianapolis Times, former communications director Terry Burns, continues to hammer home the "lack of leadership" theme this morning. Before Jen Wagner departed to the bright lights of Washington, D.C. she regularly hit that same theme. Council Democrats, led by minority leaders Joanne Sanders, are also using the "lack of leadership" line.

A couple observations. First, the theme is old, haggard, and now demonstrably false. Mayor Ballard has stepped out of the shadows and is now exercising real, genuine leadership. It is just incredibly bad leadership. What he is trying to do to Indianapolis taxpayers by handing out more corporate welfare, is not well-advised. But it certainly is leadership.

In terms of an analogy, you have another Hoosier, Rev. Jim Jones, who was born in Indiana and had degrees from Butler University and Indiana University. Rev. Jim Jones encouraged his followers to, who led his followers to drink the Kool-Aid spiked with cyanide, resulting in 914 deaths in the mass suicide. Mayor Ballard wants council members, especially members of his own party to drink the Kool-Aid of higher taxes to subsidize professional sports. For thosse Republican council members who support his tax-raising efforts, it will be political death as many find themselves with primary opponents or defeated for re-election. Certainly any chance the Republicans would have of retaining their council majority will be gone - perhaps for decades.

The second observation about the "lack of leadership" theme is one of political strategy. Local Democrat leaders are using the "lack of leadership" theme with regard to the CIB instead of the more appropriate "bad leadership" line because they simply do not want to address the merits of the Mayor's CIB bailout proposal. Bottom line? Local Democrat leaders are not opposed to professional sports subsidies or the idea that taxpayers should have to foot the bill for the CIB bailout.

Ask yourself this: Why aren't the local Democrats opposing having taxpayers pick up the $15 million in operating costs for Conseco Fieldshouse while letting the Pacers keep 100% of the profits from the building? Why aren't the Democrats criticizing the operations of the CIB, asking for an investigation, and asking for reforms of the CIB so that this mess doesn't happen again? Why aren't elected Democrats criticizing the raises to CIB employees while asking for a bailout? Why aren't Democrats questioning the propriety of the Mayor having Bob Grand, whose law firm represents the Pacers' owners, as President of the CIB? Why aren't Democrats standing up to the Colts and Pacers?

The Democrats harp on the "lack of leadership" theme because they are singing from exactly the same page as the Mayor. That "page" is one of elite, country club bipartisan politics where politicians require Indianapolis taxpayers to subsidize wealthy corporate interests that, not coincidentally, provide campaign contributions to those politicians. Enough is enough. Voters need to send a message to both parties in 2011 that taxpayers and not wealthy business owners come first.

The Madison, Indiana Courthouse Fire


News out of my home town of Madison is that the county courthouse, a structure built, in 1855, has been severely damaged by a fire. The roof collapsed into the third floor substantially damaging the courtrooms that were located on that floor.
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While I lived out in the country near a "town" of China, Indiana which had a population of about 17, I always considered Madison, a historic river city of about 12,000 about 6 miles away, as my home. I had my first job working at my great uncle's store, Hunger's Feed Market, where we sold supplies for farmers, just down the street from the Jefferson County Courthouse.
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Later, I went on to college and then law school. Ironically my job at the Attorney General's Office, trying eminent domain cases, led me back to Madison. My first jury trial took place in one of those courtrooms affected by the collapsed roof.
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In my various jobs over the years, I've had a chance to visit nearly every courthouse in the State of Indiana. I would be lying if I said Madison had one of the best looking courthouses in the State. I love old buildings as much as anyone, but the building lacked functionality, was cramped, and, with the exception of the dome, was unattractive. Ironically the fire might actually help the community make much needed improvements to the building, improvements that were never seriously considered given the desire to preserve the historic structure.

The Elton John/Billy Joel Concert at Conseco

The Indianapolis Star reports on the recent sold out concert of Elton John and Billy Joel held at Conseco Fieldhouse. Who employed and paid the individuals working at Conseco that night that helped put on the event? That would be the Indiana Pacers. The team pays the salaries of the employees who run Conseco and in return the Pacers get the profits from the building. That was the deal that was struck nearly 10 years ago.

Imagine that same concert a year or so from now. Whose employees would be putting on that event at Conseco? Still the Pacers. Who would be paying the salaries of those employees? Well if the Mayor's Office, the leadership of both local political parties, and the Capital Improvement Board have their way, that would be the taxpayers. They are all saying that the taxpayers should pay the Pacers' $15 million per year cost of running Conseco. And who would get the profits from the concert? Well, that would still go 100% to the Pacers.

It what bizarro world is this a good idea?

Wednesday, May 20, 2009

State Board of Accounts Skewers Westfield for Financial Irregularities

Previously I posted a blog entry discussing the Westfield Mayor Andy Cook's crazy idea to enter into a $1.5 billion public-private partnership to make Westfield the "Family Sports Capital of America." Gary Welsh over at Advance Indiana was the first blogger to tackle the story.

Turns out we had good cause for concern regarding the financial management of the new city's finances. In a recently released Examination Report, the Indiana State Board of Account blasts Westfield for financial mismanagement and improper accounting practices.

Let's examine a section in the report under "Credit Cards":

The Town of Westfield is using credit cards to purchase items under an approved credit card policy; however, payments were made in 2007 that were not in compliance with that policy. Payments were made using the Town's credit card to pay for the tuition expense of Towns employees. This is not authorized by the credit card policy.

For monthly payments made in 2007, it was noted that charges were paid based on credit card statement alone without sufficient itemized documentation of expenses.

No longs were provided for audit to document who had authorization to use the credit cards, when they were issued or returned.

There were charges on the credit card statement that appeared to bypass the accounting system.
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Under the section "Finance Charges," the State Board of Accounts reports:

The Town incurred, and subsequently paid, late fees and financial charges of delinquent payment of vendor invoices to Keybank for credit card payments in the amount of $1,184.73 during 2007.
Under the section "Condition of Records," the State Board of Accounts noted:
Financial records presented for examination were incomplete and not reflective of the activity of the Payroll Fund. The records presented did not provide sufficient information to examine or establish beginning balances and ending balances, or the accuracy of the transactions for the year. No subsidiary ledger of individual withholding accounts was maintained to allow the tracking of payroll withholdings by withholding type. The Payroll Fund had a balance of $313,135.13 at December 31,
2007; however, the unit cannot identify the source of this Payroll Fund balance.

In response to the report, the City stated "the Clerk Treasurer's office was unaware that such issues occurred or existed and will work to eliminate all issues." The City went on to state that "[w]ith the tremendous growth that the City has experienced, the Clerk Treasurer's Office has not been able to properly monitor each department submissions..."

Considering how Westfield has mishandled its limited budget, one wonders how they will handle the proposed $1.5 billion family sports venture Mayor Andy Cook wants for the city.

Thanks to blogger extraordinaire Diana Vice of "Welcome to My Teaparty" for sending me the Westfield report.

Mayor Ballard Suggests Taxing Joe Sixpack to Bail Out CIB; How About a Recall Provision?

Well, it's come to this. Last night while looking up the state conflict of interest rule in the electronic Indiana Code, I ran across the section dealing with removal of public officials. Furiously I began searched the Code looking for a way that the public can recall an Indiana mayor. Alas, I could find no such provision in the Indiana Code or the Constitution. The only section I saw applied to impeachment of public officials and did not seem to apply to a mayor.

Does anyone believe that if Indiana did have recall for mayors, that certainly a petition would be circulating right now to remove Indianapolis Mayor Greg Ballard from office?

In today's paper, reporter Brendan O'Shaunnessey follows up on an earlier television news report that Mayor Tax, er Ballard, has added a new tax he wants to increase to bailout the CIB's for its overindulgence in handing out professional sports subsidies. This time, Mayor Ballard wants to jack up the alcohol tax and to make the tax increase regional - not for the purpose of getting the donut counties to contribute to the CIB bailout mess, but to buy off the support of legislators representing those counties. Several mayors in those counties might appreciate the extra revenue. Certainly Carmel Mayor Jim Brainard, who has taken his borrow and spend policies to new heights in the Indianapolis suburb, would benefit from extra tax revenue.

So now, Mayor Ballard wants to increase the tax on alochol, rental cars, hotel rooms, and now apparently is now backing away from his steadfast promise about not supporting expansion of gambling. Geez, gambling lobbying money infused into Indianapolis politics - no chance for corruption there, right?

Let's recap. Mayor Ballard is desperately trying to raise people's taxes to support the CIB's subsidies to professional sports, supports picking up the $15 million a year in operating costs for the Pacers on a building in which the team gets 100% of the revenue, and refuses to investigate what went wrong at the CIB or ask that the board be reformed so this mistake never happens again. But when it comes to city's pools, the city market, mowing the city's parks, well those issues just aren't a priority for the mayor.

There is no excuse for why the city's pools could not have been fixed during the off-season. While I agree the city market needs a change in direction, most certainly a subsidy for the city market is a heck of a lot more justified than giving the Pacers $15 million more. As far as the failure to mow the city's parks, well that appeared to be nothing more than continued mismanagement by the mayor's administration.

The Governor and key legislators have talked about giving the city options during the special session. Here's an idea for legislators. How about giving the city's residents a statutory option to remove a mayor of a consolidated city? We'd appreciate it.

State v. Indianapolis Ethics Rules; Removal of Right to Abstain

On Monday night the counsel passed an ethics proposal that is supposed to provide comprehensive guidance to Indianapolis City-County councilors.

Having done some work with the state "participation rule" I note with interest that the ethics measure, Proposal 149,2009, identifies a “conflict of interest” as when a matter before the council would bestow a benefit of $1,000 or more on the councilor or a member of the councilor’s family. While this is a reduction from the $5,000 figure originally proposed, it stands in sharp contrast with the state participation statutory rule, IC 4-2-6-9, which does not have a monetary threshold for someone participating in a decision in which that person has a financial interest.

The provision I found the most interesting was a sleeper provision contained within the section dealing with when a counselor faces an "appearance of conflict" as opposed to the more tangible conflict rule mentioned above. The council ethics proposal defines an “appearance of conflict” of interest and gives the councilor the option to abstain from voting in such cases. Interestingly, if the abstention prevents the Council from deciding the issue, a majority of the council can vote to compel the councilor to vote anyway. Language which previously required that the presiding officer let the councilor abstain from voting in such circumstances was eliminated from the ethics code.

One has to wonder why members of the council thought that a counselor should be forced to vote against his or her ethical beliefs regarding the need to abstain from a vote. To give a possible example when that might come into play, let's take the situation involving Councilor Ryan Vaughn. Vaughn is an attorney at Barnes & Thornburg which represents the Simon brothers who own the Pacers. His boss at the law firm is Capital Improvement Board President and B&T managing partner, Bob Grand. What happens when Ryan Vaughn is asked to cast politically unpopular votes to raise taxes in order to bail out the Board run by his boss and give the Pacers, owned by his firm's clients, $15 million more per year?

While it could be argued that Ryan Vaughn does not have a direct conflict interest, it would be hard to argue with a straight face that Vaughn does not have a clear "appearance of a conflict." Under the old rules, Vaughn could request that he be recused from the vote by asserting the ethics rule. Now, under the revised ethics code, Vaughn can be forced to vote on the tax issue if his vote is needed to break the tie to raise taxes in Indianapolis. That's probably not a vote Vaughn would want to be forced to cast, especially in light of his desire to fill a vacancy in the Indiana Senate.

Tuesday, May 19, 2009

Marion County Property Taxes Explained

News out of the Marion County Treasurer's office is that property owners in Indianapolis will be receiving a property tax bill come June. Because there is a great deal of confusion about what is going on, I figured an explanation was in order.

Tax bills in Indiana are paid in arrears. For example, taxes on a property for 2006 are paid the following year, in 2007. That is one fact that you always have to keep in mind when sorting through Indiana's complicated property tax system.

The way I like to keep things straight is to categorize the taxes as 2006 Pay 2007, for example. That way you never forget that you're talking about taxes paid in arrears.

You pay property taxes in two installments. The Spring installment is supposed to be due on 5/10 and the Fall installment is supposed to be due on 11/10. That's the way it is supposed to work. Here's what's going on with Marion County property taxes though:

When the first 2006 Pay 2007 tax bills came out in Marion County out (a few months late) in the summer of 2007, people started screaming over how high their taxes had risen. Governor Daniels threw out the Marion County assessments on the basis that business property in the county had been undervalued. Governor Daniels said that instead of paying the 2006 Pay 2007 bill that the Marion County Treasurer had sent, homeowners could pay 2005 Pay 2006 bill pending the new assessment.

In November of 2007, the 2006 Pay 2007 fall tax installment was due. The Marion County Treasurer had issued a bill that reflected the balance that you would have to pay if you were paying the 2005 Pay 2006 taxes. Many people, like me, just paid the balance...again pending reassessment.

The first property tax bill you received in 2008 was the 2006 Pay 2007 reconciliation bill which was the difference between what you had paid on the 2006 Pay 2007 taxes and what the 2006 Pay 2007 taxes were after the properties were reassessed. That reconciliation bill came due in the Summer of 2008. Marion County taxpayers did not receive the 2007 Pay 2008 Spring Installment tax bill until December of 2008.

In other words, you really only paid one property tax installment in 2008.

The first tax installment we are getting in June of 2009 is the 2007 Pay 2008 Fall installment. You might still get the 2008 Pay 2009 Spring and Fall installments this year. In other words, you might end up paying three regular property tax bills this year. Most likely though the 2008 Pay 2009 Fall installment will be pushed back until 2010.

People who have their property taxes escrowed find they are about a year behind "real time" when it comes to property taxes. If you have your property taxes escrowed, I would not even bother trying to wade through your mortgage company's bureaucracy to get them to make sense of what's going on and make adjustments. Just shrug your shoulders and expect a wildly fluctuating escrow account.

If your property taxes are not escrowed, you should be putting aside some money in case you have to make that extra property tax installment this year.

What happens when local governments are late collecting property taxes? They engage in short term tax anticipation borrowing. In other words, taxpayers pay more when the property tax bills are late.

For an excellent explanation of borrowing to cover property taxes and the reason why tax bills are late, see Andrea Neal's column on the subject.

FYI, if you think Marion County is bad, you should have tried figuring out Brown County's property taxes a few years ago. That county was about 2 years behind.

Monday, May 18, 2009

Marion County Prosecutor 2010

The next big race on the horizon is Marion County Prosecutor in 2010. Marion County Assessor Democrat Greg Bowes has already announced his interest in the position. No word yet on whether Carl Brizzi will run for a third term. Given the political risk involved and that Marion County is becoming increasingly Democrat, my guess is Brizzi will not run for another term. One possible Republican candidate, Ryan Vaughn, has indicated he is not interested and instead has his eyes on a vacancy caucus election to fill Theresa Lubbers' state senate position. While I don't have a high regard for Ryan Vaughn, it is a smarter political move to try to get precinct committeemen to elect him to a safe seat than to run for Marion County prosecutor.

Whoever the next candidates for prosecutor are, it is clear that we need a change in direction in that office. While Brizzi likes the publicity associated with high profile cases, his office has often fumbled charging decisions then stubbornly left those charges pending against individuals who have their lives turned upside down as deputy prosecutors attempt to get a face-saving plea bargain before dismissing the charges. I have also discussed in this blog an account of one of my clients being falsely accused of robbery and how the prosecutor's office keept charges pending against the mentally disabled man (and kept him in jail where he did not get his medicine and was beaten up) even though we had him video of him across town when the robbery supposedly took place.

Unfortunately my discussions with Marion County Deputy Prosecutors, public defenders and other attorneys who do criminal cases, suggest that is standard practice for Brizzi's office. When deputy prosecutors are openly critical of how your prosecutor's office is run, you have a problem.

What I find most disturbing about the Marion County Prosecutor's Office, however, is the complete lack of interest in white collar crime in general and public corruption crimes specifically. We've given the prosecutor's office cases involving real estate fraud. One case involved a man going around forging people's name on quit claim deeds to transfer the property to his company so he could sell the property. Brizzi's office showed no interest in prosecuting that person. Now if he would have stole the man's bread inside his house, he might have pursued charges. But stealing the whole house, that gets a pass fromt he Marion County Prosecutor.

Indianapolis politics has become a cesspool of insider self-dealing, involving both Republicans and Democrats. Unfortunately we have a prosecutor who has close relationship to many of political insiders involved. Not surprisingly, Brizzi has completely shied away from any public corruption prosecutions. In doing so he's not only given he green light for public corruption in Marion County, but given that he would also be the prosecutor for corruption at the Statehouse, he has sent a message to state politicians they don't have to fear prosecution for public wrongdoing.

I don't know who the next prosecutor should be. I have heard criticism of Greg Bowes from Democrats who complain that he is not part of the good old boy network and would have trouble getting slated. While I don't know Marion County Democratic politics enough to know if that's true or not, calling him an "outsider" is an endorsement to me. The last thing the Marion County Prosecutor's Office needs is another partisan hack who turns his back on doing his job in order to protect his friends. It is time for a change in the Marion County Prosecutor's Office.

Saturday, May 16, 2009

Local Democrats Accept Mayor Ballard's Phony Arguments on Need for Taxpayer-Funded CIB Bailout

As a followup to the previous post, it should be noted that Marion County Democratic Chairman Ed Treacy did offer some encouraging comments about fiscal responsibility in the Indianapolis Business Journal article written by Cory Schouten. But do not for a second think the Marion County Democratic Party is going to suddenly be standing up for taxpayers in this debacle. Following the meeting Mayor Ballard had with Democrats on the Indianapolis City-County Council, Minority Leaders Joanne Sanders issued the following statement according to the Indianapolis Times:

"It is tragic that Mayor Greg Ballard could not exhibit any leadership earlier in this process to avoid a special session as surely the Capital Improvement Board's budget crisis is an issue that factored into the special session.

"Needless to say, Democrats understand how important this is to our community, to central Indiana and to our State. We appreciate the hard work of House Ways and Means Chairman Bill Crawford who has, in a bi-partisan effort, joined with Senators Kenley and Merritt, Governor Daniels and other State leaders to address this problem.

The City of Indianapolis has spent decades creating a vibrant downtown. Thanks to the bi-partisan effort of elected officials and private citizens over those many years, our city is home to a multitude of cultural, civic, sporting, shopping, dining and lodging experiences that attract over 22 million convention and tourist visitors every year. All of these events have created an economic engine that generates:

* 66,000 jobs with $1.9 Billion in annual wages

* $3.5 Billion in visitor spending

* $794 Million in annual tax revenues, the bulk of which go to the State

* Economic benefits for more than 2.2 million people in central Indiana

* More than 20% of the revenue distributed statewide.

"We now face a significant challenge. The operating shortfalls in some of the key venues overseen by Capital Improvement Board of Managers threaten the long term health of this engine.

"Having just met with the mayor, we pledge that as the legislature enters into this special session, we will continue to work toward a common solution. We look forward to meaningful participation by the city, the state and private enterprises, who each benefit from these activities and who each stand to lose significantly if we cannot keep all of these important pieces in place. "

Do not for a second believe there is a dime's bit of difference between the Council Democrats' approach to the CIB bailout and that proposed by Mayor Ballard. Look at Councilor Sanders' statement closely. She completely accepts as true the phony arguments Mayor Ballard is using to push tax increases. Let's examine those.

  • First, Sanders, like Mayor Ballard, misleadingly spins the CIB bailout issue as being about the city's convention business. The CIB though is not in the hole because of convention business. They are in the hole because of professional sports giveaways. Fully 3/4 of the current alleged $47 million CIB deficit is directly attributable to professional sports. The debate is about giveaways by the CIB, the ones in the past to the Colts that left a $20 million hole, and the proposed $15 million giveaway to the Pacers. The reason why Mayor Ballard and Sanders talk about convention business instead of the professional sports is that there simply is no evidence that subsidizing professional sports is a good investment for a city.
  • Second, Sanders, like Mayor Ballard simply accepts that the City's taxpayers should pick up $15 million in operating expenses at Conseco Fieldhouse, while letting the Pacers keep all of the revenue on the building. As the IBJ previously reported, the Pacers would have to pay an enormous penalty to leave. There is no reason to even consider picking up the $15 million for the Pacers. Of course, it should be mentioned that the Pacers are owned by the Simons brothers, the biggest contributor to Democratic candidates in the state.
  • Third, Sanders, like Mayor Ballard repeats that phony "economic engine" argument as an excuse for a bailout. The CIB bailout is about subsidies for professional sports teams, past and present. How is raising hospitality taxes to subsidize professionals sports teams going to help out the convention business?
  • Fourth, Sanders, like Mayor Ballard, repeats the phony 66,000 hospitality worker job figure. Those 66,000 jobs are jobs in the Central Indiana region. Many are not even in Marion County, much less downtown Indianapolis. How does some worker at a Steak and Shake on the northside benefit from giving the billionaire Simons brothers $15 million more? Again, the academic studies simply do not show that professional sports spending
  • Fifth, similarly, Sanders economic activity numbers ($3.5 billion in visitor spending, , $794 million in tax revenue, etc.) are not connected to what the CIB bailout is all about, professional sports subsidies. Again, the approach by Mayor Ballard and Sanders is the magician stunt of getting you to look at one hand while pulling the trick off with the other hand.

Sanders attacks Mayor Ballard for a lack of leadership. Of course that is the Democrats' election slogan should the Republicans renominate Mayor Ballard for a second term. At some point, however, it would behoove the Democrats to actually offer some leadership themselves. Instead the Sanders' response shows the Democrats remain solidly on the Indianapolis corporate welfare train, and that the city's taxpayers are not even a secondary consideration.

CIB Executive Director Barney Levengood Makes More Than Governor and Mayor Combined; Mayor Ballard Says That's Okay, He Trusts Judgment of CIB

This morning the Indianapolis Business Journal took a closer look at salaries at the Capital Improvement Board and discovered that Executive Director Barney Levengood was pulling in a salary of $221,325 more than the Mayor of Indianapolis and the Governor combined. He also receives a car allowance of $500 a month. As previously been reported, only months before the CIB asked the city and state for a taxpayer funded bailout, Levengood added 30 employees, increasing the number of CIB employees by 20%, handed out 3% raises across the board, and increased stadium director Mike Fox's salary by 36% to $128,242.

The IBJ reported that the Indianapolis Mayor Greg Ballard's response to this news was that he would "defer to the judgment of the Capital Improvement Board on whether salaries are appropriate." And why not? The CIB has exercised such stellar judgment in the past.

Sarcasm aside, what news has to come out before Mayor Ballard will finally put his foot down on the antics of the CIB? Gary Welsh at Advance Indiana reports on the latest IBJ stories on the CIB and opines:
"I've become convinced that it could be reported that the CIB has been secretly killing babies for the past ten years and it wouldn't make a dime's bit of difference in this bailout debate. Our elected officials received their marching orders from their true masters long ago that they would finance this bailout by hook or crook. What the taxpaying public thinks or what the facts show mean little to our out-of-touch elected officials."
I absolutely agree. I'm not sure any news could convince Mayor Ballard to maybe think twice about a taxpayer-funded bailout of the CIB. Mayor Ballard is like a robot who has been programmed by Bob Grand and Joe Loftus to fight to raise taxes to continue handing out corporate welfare, doing whatever it takes even if it costs the Republicans any chance of winning a Marion County election for the next 30 years. When the dust settles on Election Night 2011, my Marion County Republican Party need to give Grand and Loftus the boot so that they never have a role in local Marion County Republican politics again.

Friday, May 15, 2009

The Hypocrisy of the Leadership of the Marion County Democratic Party

This evening as I left the office I caught the newest post by Gary Welsh over at Advance Indiana, which reported on a press release by Marion County Democratic Chairman Ed Treacy following the behind-closed-doors meeting council Democrats had with Indianapolis Republican Mayor Greg Ballard:

In 2007 Greg Ballard promised three things: lower taxes, more transparency, and more accessibility. Today, he failed on all three counts.

After being asked by Mayor Ballard to meet on issues regarding the Capital Improvement Board, the Indianapolis/Marion County Democratic City-County Council caucus sought to finally bring the Mayor into the public light by themselves asking Indianapolis’ media to join them at the meeting. Sadly, this effort at transparency, bi-partisanship and finding solutions in a open and accessible manner was thwarted by the Mayor when he kicked the media out of the meeting. Unsurprisingly, the Mayor also reiterated his desire for several tax increases.“

This represents yet another example of Mayor Ballard trying to increase our taxes in the shadows, beyond public scrutiny. Council Democrats sought to bring transparency to the Mayor’s office, and instead the public was yet again shut out,” said Marion County Democratic Party Chairman Ed Treacy.

“Not only does the Mayor want to increase our taxes, but he wants to do so in the dark,” Treacy added.

Me thinks Ed Treacy doth protest too much.

It's not that Treacy's remarks are not accurate. The Capital Improvement Board bailout has been bungled by Mayor Ballard from day one. He's backed out on his promise for lower taxes and the decision-making in his administration has been anything but transparent. But as Welsh notes in his Advance Indiana column, the Democrats have hardly had clean hands when it comes to the CIB matter or the issues of which Treacy complains. Let's examine the Democrats record with respect to the CIB:

  • The CIB has run a deficit the last 10 years, eight of which have been under the Democrat administration of Bart Peterson.
  • It was Democrat Fred Glass, then President of the CIB, who signed the sweetheart deal that resulted in the Lucas Oil Stadium giveaways that is responsible for at least $20 million of the CIB deficit.
  • The CIB operations were extremely secretive under Fred Glass, who even at one point barred Channel 16 from covering their meetings. While the current moves toward CIB openness under President Bob Grand appear to nothing more than an effort to present a dog and pony show following deals cut in the backroom, at least it is a step in the right direction.
  • The Council Democrats have not proposed an investigation of the CIB operations to find out how the Board ended up in such a large financial hole.
  • The Council Democrats have have not demanded any sort of reform of the CIB operations so this problem doesn't happen again.
  • The Council Democrats have not asked for the resignation of Bob Grand, who has an enormous conflict of interest representing the Simons who own the Pacers while at the same time being President of the CIB and presiding over the Pacers' fate.
  • The Council Democrats have not asked for an investigation of how the CIB came to decide, without a public vote, to pick up $15 million in operating costs for the Pacers at Conseco Fieldhouse.
  • In fact, the Council Democrats have completely accepted the premise of picking up all $15 million in operating expenses at Conseco Fieldhouse, a building which the Pacers (i.e. the Simons...the Democrats' biggest campaign contributor) will get 100% of the revenue off of.
  • Council Democrats have refused any option that would hold the Pacers and/or Colts accountable and make the teams primary responsible for closing the deficit instead of the taxpayers.
  • Council Democrats have not proposed any option other than giving the CIB more taxpayer money.

While Mayor Ballard's claim that he inherited the CIB mess is accurate, he has bungled the solution to that mess so badly as to jeopardize the future of the Marion County Republicans for years to come. Still the Democrats should not get off the hook for their past mismanagement of the CIB, their unwillingness to investigate or reform the Board, and their failure to offer any proposal of their own except for giving the CIB more taxpayers money. Mayor Ballard has given the Democrats a chance to show real leadership and instead they demonstrate hypocrisy and a lack of interest in standing up for Marion County taxpayers. In other words, just more of the same elite, country club politics we've grown accustomed to from the two parties here in Indianapolis.