Summer, budgets and tax rates

This has been quite a summer holiday season locally.  The Spark Fishers Festival drew a large crowd.  The Carmel and Noblesville 4th of July events saw plenty of people along their respective parade routes and festival locations.  After more than a year in lockdown, we are all ready to gather again and enjoy each other’s company.

Summer is a great season for being outside and taking family vacations.  But something else is going on quietly, behind the scenes here in Fishers.  I am referring to the process of fashioning the 2022 city budget.

Yes, city officials are going through the process of how to handle spending in the next calendar year.  Last year at this time, everyone was worried about how the COVID pandemic would impact the city budget.  You can credit both the Trump and Biden Administrations, along with Congress, for providing financial assistance to local units of government that made the 2021 spending plan a bit easier to fashion.

Fishers was able to provide a 3% pay increase for city workers in 2021, which did not look promising at this time last year.  The city was mostly reimbursed for the Health Department’s testing and vaccine programs.

The economy looks rosy at the moment, with more jobs than takers (although that is not necessarily so in every field of work).  So, why is this budget cycle so important?

There are two reasons – City Hall and a new community center.

When the city council had a retreat in May, there was, for the first time, a public discussion of a new City Hall building.  Mayor Scott Fadness made it clear that constructing a new city office building was never on his agenda, but the current structure is, according to the mayor, sinking and of a “flimsy construction.”

The city is continuing to spend money just to deal with the building’s problems, and is now to the point that demolishing the current City Hall and constructing a new one may be the only viable option to stop the drain on the city budget.

There is also a group headed by City Councilman at-large Todd Zimmerman studying the possibility of a new community center.  This is looking to be a very big project.

Both a new city hall and a community center will take money.  How will the city manage that?

Fadness told the city council he wants to do all this without burdening the taxpaying public.  Will the city be able to keep the city tax rate relatively stable and still build a new city hall as well as a community center?

My conversations with city officials indicate they are confident this can be done.  The city has already built a health department without increasing the tax rate burden on city residents, and even slightly reduced that rate funding the health department.

Two new major construction projects would need to be financed and added to the debt.  Paying back that debt would come from the property tax rate and also local income tax revenue.  Property valuations have been increasing locally, but the state prescribes that system, the city has no control over that part of the tax code.

Some debt may be close to paid-off, which allows the city to borrow without increasing the local tax rate funding the debt.

There are other moves the city may be considering that I do not know at this time.  I do know that our Fishers elected officials are planning all these projects without a hike in the property tax rate.

Can Fishers have a new City Hall and community center without a tax rate increase?  We will watch the budget process this year and see.