Ballard Will Claim 10% Cut Whether It's True Or Not

The Star's Jon Murray takes a look at the promise Mayor Greg Ballard made when he ran for election in 2007 that he would cut the city's non-public safety budget by 10% during his four years in office or he wouldn't seek re-election. Of course, Ballard conveniently forgot about that promise until reminded of it, and his administration is now playing games with the numbers to convince you he kept that promise. The only reliable analysis of the numbers proves Ballard did not keep his promise. Here's Ballard's claim:

Ballard hasn't released an accounting of which cuts he's made to reach 10 percent. He mentioned several large examples and said the total was "in the $60 (million) to $70 million range," which would be in the ballpark.


But his critics point out there has been little decrease in the bottom line, saying that's what matters most. Next year's city and county budget is $1.16 billion.

At first glance, numbers provided by the city controller in next year's department-by-department budget show some decreases over the past three years, but those are misleading. They include one-time costs and items that have been permanently removed or newly added over the years, such as several township fire departments that merged with the Indianapolis Fire Department recently.

After the city controller made those adjustments for comparison, what looked like a 5 percent decrease in the overall budget from 2008 to 2011 evaporated into a 1 percent increase. The controller says the 2008 overall budget was $1.22 billion.

Take out the public safety and criminal justice categories -- which together will make up just over half of spending next year -- and the unadjusted numbers show a 17 percent decrease in the areas targeted by Ballard. But make similar adjustments for comparison, and that turns into a 1 or 2 percent increase.

Here's the reason Ballard's numbers simply don't add up. As Murray points out, the state has picked up some pretty big costs that were included in the city's budget when Ballard took office in 2008. "Some adjustments are for costs that were picked up by the state, such as the budget for the Division of Family and Children. It cost the county $108 million in 2008, but nothing this year," Murray writes. "Ballard claims credit for some of those savings, even if the state -- and its taxpayers -- are now on the hook." Murray leaves out another big item Ballard is claiming as a savings--the more than half billion dollar unfunded public pension liability the state picked up. One of the driving motivations behind Peterson's 2007 local option income tax increase, which Ballard opposed as a candidate, was to provide a revenue stream to pay that indebtedness. Peterson planned to issue bonds and dedicate about $25 to $30 million a year to pay towards the debt with the approximately $90 million the income tax increase generated annually. 
 
As part of the property tax reform legislation enacted by the legislature in 2008, the state picked up both the county welfare costs and that unfunded pension debt. That allowed Ballard to forgo issuing the bonds and using part of the income tax increase proceeds to pay debt on the bonds; instead, he made the Peterson income tax increase permanent and spent the extra money elsewhere in the city budget. He certainly didn't return it to the taxpayers as he suggests. At the same time, all Marion Co. taxpayers permanently began paying 1% more in state sales tax to pay for the 2008 comprehensive property tax reform legislation that also capped property taxes.
 
Don't confuse Ballard with the facts though. "Ballard said he will make the case that he fulfilled the 10 percent promise," Murray writes. "We'll outline all that for you in the future," he said. "But we feel very comfortable that we're way past that number." Ballard is also making wild claims in other areas of the city-county budget. "He pointed to other examples of fiscal shrewdness, including saving hundreds of millions on interest for the new Wishard Memorial Hospital project and $740 million in savings from recent engineering changes in a 20-year sewer upgrade," Murray writes. How do you save hundreds of millions of dollars on interest when you borrowed $700 million to build a new hospital we don't even need? The $740 million in savings from engineering changes in the CSO is similarly specious. He also overlooks his administration losing at least $90 million in risky bond swap agreements.
 
In a separate story in which Murray interviewed Ballard about his re-election, Greg says "We can't go back to the way the city was." Does he mean back in the days when there was no transparency in the budget process, tax increases, no-bid contracts for political contributors, sweetheart tax breaks and incentives for the political cronies, more public handouts to billionaire sports team owners and ethically-challenged officials lining their pockets at taxpayers expense? Yeah, a lot has changed, hasn't it?