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Ask The Mayor: Bloomington's Hamilton on tax increase, fiscal transparency

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Unknown Speaker
Okay. Well hello and welcome to ask the mayor on WFIU, I'm Joe Hren with WFIU WTIU news. This week we are in person in Bloomington, with Mayor John Hamilton. Hello, and welcome,

Unknown Speaker
Joe. It is so nice to see you in the three dimensions. Welcome back to city hall in the mayor's office. Good to be with you.

Unknown Speaker
And we're always looking for your questions, you can submit them to news at Indiana public media.org or Twitter at Ask the mayor. So let's get right to it the news that we've been talking about, we had a whole hour show on the tax increase on Noon Edition. So if you haven't seen it, it's online. I thought it was a great discussion with a lot of different people. And you can listen to a lot more there. But at least over here on this show. Just a quick overview. We've calculated a 64% increase City Council heard the proposal. They could they could vote on it on Wednesday $18 million in city revenue. A similar proposal failed a couple of years ago. You know, I know some people would say it's never a good time to raise taxes. But this time, you know, post pandemic, there's inflation mccsc might be proposing referendum. annexation might be taking effect. We don't know yet the outcome of that. Why now?

Unknown Speaker
There's always a lot going on in Bloomington, Joe, and thanks for the question. You know, I have talked about the importance of new revenue for Bloomington for a couple years. And the pandemic did cause us to hit pause on that. But but the fact is, we really do need new revenue. And maybe I can put it in a little context. First, we haven't raised the local income tax in Bloomington for general purposes for more than 30 years. And in that time, the city has grown a great deal, population and scope and activities and we face some of the same price pressures that everybody else does. But also it's kind of important to recognize Bloomington is doing really well in a lot of ways. If you look at our jobs. And you know, we mentioned inflation, but you look at jobs and unemployment, we have a really extraordinary growth of jobs. We have a growth of wages locally, we have some of the most spectacular public parks that we've got a gold medal winning park system we have. We're the only city in Indiana Joe that has a Kalia accredited the national credit, it's Police Department, and a top rated Fire Department. So there are a lot of things going well. But we have to be sure they keep going well, and they're going well. Because a lot of people over the years have invested in this city and made good choices. We've had over $3 billion of private investment in the last few years. So the revenue will let us keep that momentum going. Keep some of the basics going with public safety and essential city services, but also help us address some of the big challenges right in front of us. Two of them are climate change, making sure we're adapting we're mitigating we're investing in efficiencies and improvements that deal with climate change. And then second, helping make sure the city really is accessible and works for everybody. That's affordable housing. That's investing in infrastructure that helps be accessible to people. So it is an investment in the future. And I know sometimes people say now's not the right time. But I like the question. Why are we doing it to be asked also, why would we not do this to make the future brighter for everybody here?

Unknown Speaker
Well, that's probably the hardest part for you. And the city is trying to convince people what they get from this, this is not this money isn't going into a vacuum and will never be seen again that this is something that everybody benefits from. Is that

Unknown Speaker
true? Well, it is Joe. And it's a wide range of benefits from serious investments in public safety, to improve pay for our police officers to repair and replace outdated fire stations and police station, as well as serious investment in our transit system. This would really take us to the next generation of a transit system. And by the way, that's a really smart investment. From my perspective, when we have a whole bunch of federal infrastructure money on the table ready to come to communities that are investing in transit, it would support affordable housing. It will support basic city services, cyber infrastructure, for example, cybersecurity, which we need to do, there's a wide range and I think the city council is deeply into kind of weighing all of those things and I think we'll come out with a package that will really advance the city well.

Unknown Speaker
So I guess that leads right into my next question. Last meeting didn't seem like overwhelming support. So what have pins are what do you think will happen Wednesday?

Unknown Speaker
Well, I think of the nine city council members, I really think every one of them believes new revenue is important and necessary. Now each of them has a little different take probably on what they would do with exactly how much revenue and that's how democracy works. So my job has been to try to propose what I think is a very reasonable, responsible, affordable tax increase that will support so many good services, their job is to come together, compromise, negotiate. And I think that's going on right now, you saw some of an in public negotiation in public is not always the most attractive thing to see. But you know, that's how we get it done.

Unknown Speaker
So could that number change on Wednesday night? Or is that something that has to come from the city, you and you propose it like? How does that work?

Unknown Speaker
Yeah, so what the council technically votes on is a rate change. And then, you know, there's a lot of technicalities, because actually the local income tax Council, which is bigger than just city council, but they vote on a rate change, they can reduce the rate that the resolution has proposed of 0.855. And do that just in an amendment, if they're going to if they were to raise it, they would have we'd have to start the process over again, with public notice and such. So I don't expect them to raise beyond that. And they may adjust it, tweak it. And then there's a whole set of particulars that are actually not in the ordinance, but that would be between the administration and the city council to agree on. How are we going to invest that in the coming years?

Unknown Speaker
Okay. We have an email from William, and this has to do, he read a report at with another media about an them opening an open records request in order to get access to portion of a taxpayer funded consultant's report devoted to improving communication between the mayor and common common council. So he wants to know why there was has been no effort made to implement the recommendations in this report. This is the Novak report. Are you familiar with that? Yes. And could you answer his question?

Unknown Speaker
We we've hired Novak, which is a very qualified, excellent consulting group to help us really evaluate each department, step by step each city department. And we've had, you know, 15 or so of those reports over the last three years, I think. And they all get made public. And there was one that looked at City Council and Administration, one of the main things it looked at was boarding commission structure and how that works and how we can improve it. It is a public report, we are implementing it now. We don't implement everything they recommend. We don't agree with all those parts. But and I haven't read that report for a little bit. But it encouraged. I think it did encourage review of some of the board and commission appointments and structures, which we're working with council on, but happy to talk in more detail if they want to contact my office.

Unknown Speaker
Are there other things that you can know that you are implementing from that report? Well,

Unknown Speaker
the board and commission thing we are we are working with the council on? I think it recommended some regular meetings, which we're already doing with City Council in terms of scheduling and coordinating. And I meet with leadership of city council every other week, a separate from scheduling. And that may have been in that report. I just I can't remember exactly. But it's been a helpful process to get a third party look at the parks department or the police department or a relationship with council or human resources department and all that. And it's been helpful to think about how do we manage our city operations?

Unknown Speaker
I don't know if you've seen two he mentions the HT guest column from a former City Comptroller and an IU professor, and how the city isn't providing enough fiscal transparency. So yeah, I'm sure

Unknown Speaker
I'll beg to differ, I'll beg to differ. I think we are extraordinarily transparent. And I've actually been in touch with those authors. They didn't talk to us before the column but most of what they talked about in the column is publicly available. We are doing the they talked about a comprehensive annual financial report, which the city used to do in 2009. And before and stopped Well, before I came into office, we are doing that we're ready to do that we're waiting for the state to complete an audit for 2020. We can't release it until the state's done. But we totally agree with the importance of transparency, there's you can watch virtually daily the expenditures and income of the city. All of our financial status and reports are online, many of which required by state government and then many of which are more just additional release of transparency, of loss of financial information from now I will say city government financing is complicated. And you can sometimes pull a a number off of a website and say, Oh, well, this says this is your cash balances. But this one says differently. It's complicated. There are a lot of different ways and sometimes when you report so many things out there. It can be confusing, but we're happy again to work with anybody talk with anybody about the finances.

Unknown Speaker
So annexation is now tied up in the courts. So just a quick question I had I know you probably can't say too much, but I was curious on why the lawsuit was named the Monroe County Auditor, instead of the state, because at odds is that 2019 law, and there are other things, too. There are many reasons why the lawsuit is there. But I found that kind of interesting was wondering if you could elaborate on I'll

Unknown Speaker
try. So there are a couple of different lawsuits going on, because of the difference in the remand stration. So the two areas that were under 65% are really a kind of traditional annexation litigation, where the court has to decide is this appropriate, right. And so that's happening and the thing you do is the reminds traitors file a lawsuit and we respond, we do expect the state to intervene because of the constitutional questions, then the other lawsuit is because it's really focused on the waiver issue. Because the auditor followed the 2019 law and discounted a whole bunch of waivers that we believe should be counted. She is really the person that we have to sue. She didn't we're not saying she did anything wrong in particular, but just that complying with that 2019 law violates the Indiana constitution and the federal constitution and other so it's a lot of legal technicalities, but there are two different lawsuits based upon whether they were under 65% or over 65%.

Unknown Speaker
Right. And you were first mentioned the one about if the reminds traders reached more than 51%, they could go to court which they had they had that's a separate

Unknown Speaker
that's a separate for areas, one A and one b two areas on the west side. So that will have one process kind of and then the other areas, they got over 65%. But our view is the vast majority of them were actually waivers that had been signed and were agreed to and we think should have been accommodated and dealt with so will the courts will have to sort it out.

Unknown Speaker
Any word on timeline or anything like that, not as

Unknown Speaker
quick as any of us one. That's all I can tell you probably I know everybody would like to get it resolved.

Unknown Speaker
John emails in just regarding annexation, and he called it the landslide remonstrance period on annexation and wanted to know, if you recognize that you don't have the consent of the government as described in the declaration of independence as a prerequisite for powers of government. And therefore we recognize that the people have spoken and end the annexation process.

Unknown Speaker
Well, I appreciate the question, you might expect I have a little different take on it. The reason annexation has proceeded the way it has in Bloomington and around the state is the state law set up a process by which cities like ours would extend sewers, which is typically the first service that people want and need to be to be connected in near a city, urban development, denser development, they need sewers, and in their Indiana law for many, many years, we have extended sewers to people in exchange for which they promise to join the city when it's time when we ask, we could have done that. And we may do it in the future. Say you get sewers when you join the city. That is you don't get city sewers until you join the city. Some jurisdictions do that some states do that Indiana had a different process. So that lag of time on the waivers, if you will, so that when you get sewers, you agree to be part of the city then prompted this state government to step in and void those waivers. And we've that's what we think is unfair and illegal, in fact, because we did our part of the deal, which is extending sewers to 1000s of people who now say I don't want to be part of the city and we say well, you've already agreed or the property owner before you agreed and it runs with the land that way but I understand a lot of people would pick ala carte city services if they could and say hey, I'll pay for the bus or I'll pay for the transit or I'll pay for the sanitation or I'll pay for this but I don't want to pay for that. And that's just not the way cities work.

Unknown Speaker
Johnson Creamery smokestack is coming down. Not all of it, some of it. timeline on that. Do you have any more information?

Unknown Speaker
Joe? I really don't. As soon as we can. We've been working diligently. It's been a complicated legal struggle and historic designation. And now that the basically the the steps have been taken to from the Historic Preservation Committee and from the council to to say yes, bring it down, bring it down to 60 feet, make it safe. That's the first thing we need to have done. And then there will be some future steps but I do expect in the weeks ahead, it will be demolished or deconstructed, really down to 60 feet to keep it safe. It's just it's not a safe structure right now.

Unknown Speaker
I didn't notice there are cell phone transmitters on them are those the cities or though

Unknown Speaker
cuz those are those are private cell phone Active Cell Phone transmitters that do need to be removed before it comes down. So that's been a little bit of the private owner of the smokestack has to get the private owner of the cell tower equipment off, but we expect that pretty quickly.

Unknown Speaker
Okay, but that's nothing that city is getting money from getting. We're not Yeah, no. We just have a couple minutes left. I just wanted to mention this little five weekend, we have a lot going on. And I guess, message is just to be safe this weekend.

Unknown Speaker
Do be safe. I know people will be excited to have the world's college colleges greatest weekend, you know that coming. And it's been a couple years since people could be together. That will be exciting. I hope all the people in the race stay safe. And I certainly urge everybody in the community to stay safe, take care of each other. You know, we want everybody to get through this great weekend safely. We'll have a lot of presents their public safety, it's one of the biggest weekend's for public safety, to be present and enjoy it, but be safe.

Unknown Speaker
We have 90 seconds left. And I always like to leave that to you the mayor. So any announcements you'd like to make or any new news?

Unknown Speaker
Joe, I just like to say I know there's a lot going on in the city, including the local income tax issues and bond public bond issues. I just think it's good to remember things are going very well. We've been through a really tough couple of years. But the city has bounced back. Well, the businesses, many are thriving again. Again, our employment rate is very low wages have gone up quite a bit in Bloomington, even compared to some other Indiana cities. So we're really a lot of things moving in the right direction. And we just want to make sure we're doing today. What builds keeps that momentum going for the next generation and I look forward to continuing that work.

Unknown Speaker
Thank you very much. Thanks, Joe.
Bloomington Mayor John Hamilton

Bloomington Mayor John Hamilton during Tuesday's interview at City Hall. (Joe Hren, WFIU/WTIU News)

Hamilton explains why now is the time to raise the local income tax rate, the communication process between the mayor and council, and your questions on fiscal transparency, and the lawsuit on annexation waivers.

In this week’s installment of Ask The Mayor, Bloomington Mayor John Hamilton addresses these issues and more during an interview Tuesday at City Hall. 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. Here are some highlights.

This conversation has been edited for clarity and conciseness.

Hren: We had a whole hour show on the proposed tax increase on Noon Edition Friday. I thought it was a great discussion with a lot of different people. I want to carry that discussion over here. We've calculated a 64% increase of the local income tax adding $18 million in new revenue.

City Council heard the proposal. They could vote on it on Wednesday. I know some people would say it's never a good time to raise taxes. But this time, it's post pandemic, there's inflation, MCCSC might be proposing a referendum, annexation might be taking effect. Why now?

Hamilton: I have talked about the importance of new revenue for Bloomington for a couple years. But the fact is, we really do need new revenue. First, we haven't raised the local income tax in Bloomington for general purposes for more than 30 years. And in that time, the city has grown a great deal, population and scope and activities and we face some of the same price pressures that everybody else does.

But also it's kind of important to recognize Bloomington is doing really well in a lot of ways. If you look at our jobs and unemployment, we have a really extraordinary growth of jobs. We have a growth of wages locally, we have some of the most spectacular public parks that we've got a gold medal winning park system. We're the only city in Indiana that has a CALEA accredited Police Department, and a top rated Fire Department.

We have to be sure they keep going well because a lot of people over the years have invested in this city and made good choices. We've had over $3 billion of private investment in the last few years. So the revenue will let us keep that momentum going, but also help us address some of the big challenges right in front of us.

Two of them are climate change, making sure we're adapting, we're mitigating, we're investing in efficiencies and improvements that deal with climate change. And then second, helping make sure the city really is accessible and works for everybody. That's affordable housing. That's investing in infrastructure that helps be accessible to people. I know sometimes people say now's not the right time. But I like the question, why would we not do this to make the future brighter for everybody here?

Hren: The last meeting didn't have overwhelming support. So what do you think will happen Wednesday?

Hamilton: I think of the nine city council members, I really think every one of them believes new revenue is important and necessary. Now each of them has a little different take probably on what they would do with exactly how much revenue and that's how democracy works. So my job has been to try to propose what I think is a very reasonable, responsible, affordable tax increase that will support so many good services. Their job is to come together, compromise, negotiate. 

The council technically votes on a rate change. Actually the local income tax council, which is bigger than just city council, but they vote on a rate change, they can reduce the rate the resolution has proposed of 0.855. And do that just in an amendment. If they're going to raise it, we'd have to start the process over again, with public notice and such. So I don't expect them to raise beyond that. And they may adjust it, tweak it.

Hren: We have an email from William about a consultant's report devoted to improving communication between the mayor and common council. He wants to know why there was has been no effort made to implement the recommendations in the Novak report. Are you familiar with that?

Hamilton: We've hired Novak, which is a very qualified, excellent consulting group to help us really evaluate each department, step by step each city department. And we've had 15 or so of those reports over the last three years, I think. And they all get made public. And there was one that looked at City Council and Administration. One of the main things it looked at was boarding commission structure and how that works and how we can improve it.

It is a public report, we are implementing it now. We don't implement everything they recommend. We don't agree with all those parts. And I haven't read that report for a little bit. I think it did encourage review of some of the board and commission appointments and structures, which we're working with council on, but happy to talk in more detail if they want to contact my office.

I think it recommended some regular meetings, which we're already doing with City Council in terms of scheduling and coordinating. And I meet with leadership of city council every other week, separate from scheduling. And that may have been in that report. It's been helpful to think about how do we manage our city operations.

Hren: He also mentions the H-T guest column from a former City Comptroller and an IU professor, and how the city isn't providing enough fiscal transparency.

Hamilton: I'll beg to differ. I think we are extraordinarily transparent. And I've actually been in touch with those authors. They didn't talk to us before the column but most of what they talked about in the column is publicly available. They talked about a comprehensive annual financial report, which the city used to do in 2009 and before and stopped well before I came into office. We are doing that - we're ready to do that, we're waiting for the state to complete an audit for 2020. We can't release it until the state's done.

You can watch virtually daily the expenditures and income of the city. All of our financial status and reports are online, many of which required by state government and then many of which are additional release of transparency.

And you can sometimes pull a number off of a website and say, oh, this says this is your cash balances, but this one says differently. It's complicated. There are a lot of different ways when you report so many things out there. It can be confusing, but we're happy again to work with anybody about the finances.

Adopted Bloomington Annexation Areas
Annexation areas courtesy City of Bloomington

Hren: Annexation is now tied up in the courts. I'm curious as to why the lawsuit was named on the Monroe County Auditor, instead of the state, because at odds is that 2019 state law. I'm wondering if you could elaborate on that?

Hamilton: Because it's really focused on the waiver issue. The auditor followed the 2019 law and discounted a whole bunch of waivers that we believe should be counted. She is really the person that we have to sue. We're not saying she did anything wrong in particular, but just that complying with that 2019 law violates the Indiana constitution and the federal constitution and other so it's a lot of legal technicalities.

READ MORE: Pushing City Limits: Bloomington Annexation Coverage

Hren: John emails in, he calls it the landslide remonstrance period on annexation and wanted to know, if you recognize that you don't have the consent of the government as described in the declaration of independence as a prerequisite for powers of government. And therefore recognize that the people have spoken and end the annexation process.

Hamilton: I appreciate the question, you might expect I have a little different take on it. The reason annexation has proceeded the way it has in Bloomington and around the state is the state set up a process by which cities like ours would extend sewers, which is typically the first service that people want and need to be to be connected in near a city, urban development, denser development, they need sewers, and in Indiana law for many, many years, we have extended sewers to people in exchange for which they promise to join the city when it's time when we ask, we could have done that.

That prompted state government to step in and void those waivers. And that's what we think is unfair and illegal, in fact, because we did our part of the deal, which is extending sewers to thousands of people who now say I don't want to be part of the city and we say well, you've already agreed or the property owner before you agreed and it runs with the land.

I understand a lot of people would pick ala carte city services if they could and say hey, I'll pay for the bus or I'll pay for the transit or I'll pay for the sanitation or I'll pay for this but I don't want to pay for that. And that's just not the way cities work.

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