ANALYSIS: Mayor Winnecke Inherited Some Financial Shortfalls From His Predecessor

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MAYOR
MAYOR

The generous reduction in rent being offered the Evansville Icemen to encourage them to sign another lease on the Ford Center has ruffled a lot of taxpayers’ feathers. It has a number of folks hopping mad at the recently re-elected Mayor, but the truth is that the lease on the Ford Center is just one part of a multilayered mess that Mayor Winnecke inherited from his predecessor, Jonathon Weinzapfel. It is also true that Weinzapfel inherited a mess from Russell Lloyd, Jr., who preceded him in the corner office on the third floor of the Civic Center. It appears that handing down a mess to one’s successor is becoming a local tradition for Evansville’s Mayors.

The truth is that Mayor Winnecke didn’t have any input into the Icemen and Ford Center agreement that is now up for renewal. The first lease was negotiated by the Weinzapfel administration, and now that Ron Geary has seen what his “earnings” are at the Ford Center, it is only sensible that he would pull out all the stops to make a better deal this time. That leaves the Mayor between the proverbial rock and hard place. He can be intransigent and likely lose the Icemen or he can capitulate and increase the losses on the Ford Center.  Either result will be a losing one for him.

The Ford Center’s losses are not the only problems that Mayor Winnecke inherited. The “Convention Hotel” will open on his watch, but that project was launched long before he took office. It is true that he is the one who, with the “help” of City Council finally made a deal to get some sort of hotel built next to the arena. We can thank the Visitors and Convention Bureau and the Chamber of Commerce for adding that to our “must have” list. The project we bought included a ten story tower and high end apartments, plus a parking garage. The one that we will wind up with, for the same cost, has no apartments and is a five story stick-built facility without the indoor pool and rooftop bar of our dreams.  At least he, with the unanimous vote of the City Council, scratched the “itch” for a hotel that we are told will make the Ford Center more attractive to conventions and big name shows. The highly-paid consultants all tell us that the subsidies we are putting out now will result in profits, very soon. We hope so.

It is the City Council that actually agrees to public spending and its members must share in the responsibility for the tradition of free-spending and the failure to make agreements that deliver the product that they are buying, as was the case with the new Downtown Hotel.  It is not the sole fault of the out-going City Council. Along with Dan McGinn, Missy Mosby, Stephanie Brinkerhoff-Riley, Connie Robinson, John Friend, Al Lindsey, Dan Adams, Conor O’Daniel, and Jonathan Weaver, previous Council members, Wendy Bredhold, BJ Watts, and Curt John are to be recognized for loosening the purse strings that brought us to our current deficient spending situation.

We already know that raising taxes is being presently discussed by members of the newly elected City Council, and we believe that will be a reality early next year. We remind all of our readers that while the Mayor may support raising taxes to make ends meet, it will not be his final decision. That unpopular move will rest on the doorstep of the 2016 City Council.

The Evansville Redevelopment Commission should carry a big share of blame for the financial fix we find ourselves in. For a number of years Ed Hafer  and Bob Goldman were Presidents of the free spending ERC of City It now looks like newly elected President of the ERC, Randy Alsman has continued the “kid in a candy store” spending precedent set by his predecessors.

The Ford Center losses, the potential losses of the Downtown Hotel, unexpected costs to purchase a $600,000 32 spaces parking lot for the McCurdy, losses at the Victory, City Parks and Mesker Zoo, and the costs of fulfilling the plans for Roberts Park should all not be credited to Mayor Winnecke. Those are part of his “inheritance”.

When we add in the costs of repaying the $8 million dollar loan borrowed from the Riverboat and Rainey Day funds to pay bills and make payroll, bringing IU Medical School to Evansville and the beginning of the CSO project mandated by EPA for decades, the renovation of Mesker Amphitheater you will see that the our extremely popular Mayor has a lot of financial challenges on his plate for the next four years and we wish him and the new City Council the best in the coming 4 year term because they are going to need it.

31 COMMENTS

  1. Excellent CCO article. You could add the tragic community loss of Mesker Amphitheater for lack of basic maintenance and repair.

    • Joe Biden

      Thanks for the suggestion. Just included Mesker Amphitheater in article.

      Thanks for you input and support.

      Keep reading the CCO.

      EDITOR

  2. Same argument Obama makes.
    1. You didn’t inherit it, you campaigned for it.
    2. You didn’t change the problem, you added to it.
    3. The only difference between you and your predecessor is where your name appears in the phone book.

  3. Leadership(?) in the Evansville Political Circles has proved to be indulgent, and less than stellar for sometime now.
    Expectations,–considering the “Pool of Geniuses” continually put forth by the Smug Elitists, look dire as far as the eye can see,– with the result,— a substantial increase in the cost of living in Evansville for the peasants.
    Not exactly a recipe for Growing a City.

  4. I don’t like the Idea of raising the local income taxes but the decision was already made to spend more money than we have. Now they are already raising the maximum amount allowed by law on the property tax side. That amount cannot be increased. The Indiana Department of Local Government Finance (DLGF) will not allow it. The money has to come from somewhere. Is there any other option but to raise this income tax?

  5. This reminds me of the news about half of the ObamaCare exchanges going bankrupt and the largest insurer in the country (United Healthcare) considering pulling out because the lost $425 Million.

    How are the Ford Center and ObamaCare alike when it comes to financial performance? They both were sold on the basis of lies and delusions by politicians who were hoping to us them to establish a legacy for themselves.

    In the end, what is designed to fail will fail and the taxpayers will have to pay to clean the mess. These two programs were born of the same empty mind. How the heck could they have worked when they were born from lies and stupidity? The chickens have come home to roost.

    • Joe

      Love ya, man, but UHC (United Healthcare) is not even a major player in the ACA system. UHC threatening to leave the ACA is more bluster and marketing and posturing on their part.

      For coverage year 2015 (which began in the last quarter of 2014) when UHC offered coverage for ACA members they only insured 5% of the market. I’d say they must suck at covering people if after 2 years they only pulled 5%. Pretty sad.

      Since the number of beneficiaries under ACA has grew by over 5 million beneficiaries how come they only covered 5%? UHC actually LOST membership while all other insurers grew. I think UHC has problems other than the ACA, and the two are not related.

      Within the first 18 months, the 31 million people benefitting from the ACA was shown as:

      About 15.1% of the entire American population that falls between the ages of 18 and 65.
      The size of 1/5th of the entire workforce in the United States.
      More than twice as large as the number of members of labor unions in the United States.
      Eight times larger than the entire federal government (including military and civilian personnel).
      60% of the total Medicare population. There are currently about 50 million people enrolled in Medicare.

      In the past two years, the number of people uninsured has fallen to about 11 million people. Before the ACA up to 47 million were uninsured. The percentage of the country that is uninsured, according to Gallup, has fallen to under 10% for the first time in modern American history. These changes have enormous impact, in terms of how Americans will go about taking new risks and what type of impact this freedom will have on their general view towards the U.S. economy. For what it’s worth, the general view on the ACA has reached the point where for the first time more people want to keep or expand the bill as opposed to replace it.

      Also, we should take a look at the ACA assistance to the Medicaid system. There has been a net increase of 13.8 million covered lives due to the ACA expansion of Medicaid. This coverage expansion has allowed millions of sick and disabled to receive healthcare in many cases for the first time in their lives. By getting proper care it reduces uncovered health costs by billions, costs which we as taxpayers paid by outrageous sums.

      Yeah, losing a 5 per center not gonna make an impact. Anthem will grab that no problem. Since UHC only had 5% their exit is not gonna be a major deal. Besides, UHC and their approach to healthcare sucks. They are more interested in pencils and paper-pushing than assisting people. Trust me, I know this first hand.

      PS: The health insurance system is called the Affordable Care Act, otherwise shortened to the ACA. Obamacare is a political slang that is crude and crass IMHO. Yes, many use it, but it detracts from a discussion to use this as slang for the ACA, since it makes clear that the opposition is more on the politics of our President who fulfilled a promise to provide healthcare for Americans over the success of the ACA. And yes, the ACA is a success, and that burns the right wing, a wing who tramples it but has NEVER offered an alternate that could work.

      • CEP-Brag about coverage all you want, but at WHAT COST to the Taxpayers AND the individuals paying the premiums?–This years Premium for my wife increased MORE than 5 fold from the previous year, with less coverage from a pitiful basic “Plan”.
        The whole scheme sucks, and she, (one of the healthy ones the scheme supposedly needs) will be dropping out, and we will be paying the penalty. You can put the (Affordable?-what a Joke) Obamacare “Fairy Tale” you weave from the perpetrators propaganda. We are consoled though,– as this piece of crap WILL die from it’s own flaws,– while you— can keep drinking the Kool-Aid you obviously love to slurp.

      • Bravo, Classy. I don’t think the right is going to get their ACA “death spiral” that they are looking forward to any time soon.

      • Promise during the sales pitch.

        “If you like your doctor you can keep your doctor” FAIL

        “If you like your plan you can keep your plan” FAIL

        “The average family will save $2,500 per year” BIG FAIL

        “Everyone will be covered” over 30 million aren’t FAIL

        “20 million new sign ups by 2016” 50% achieved. FAIL

        You can’t even show one person out of 320 million who received all of the campaign promises. Quite frankly the ACA makes Winnecke and Weinzapfel’s Ford Center performance look honest and exemplary.

      • Joe,
        Obama said long ago that he was fine with people calling it Obamacare. You fail to mention the facts that out of pockets have skyrocketed for those that have traditional plans, outrageous fines for those that can’t afford any insurance. Oh, and don’t forget “if you like your plan, you can keep your plan”. The left likes to say that the government can run this because they already run Social Security & Medicare so well. Probably not the best argument.

      • CEP:

        When I did a search on some of the data you have reproduced here it led me back to the NDN (New Democratic Network) website.

        * * * * * * * * * * * *
        Wikipedia

        “NDN is led and was founded by Simon Rosenberg in 1996 after his split with the Democratic Leadership Council, for which he worked. Before founding NDN, Rosenberg worked as a television news writer and producer and a political strategist for the Michael Dukakis and Bill Clinton presidential campaigns and the Democratic National Committee. NDN has offices in Washington, D.C., New York City, San Francisco, and Miami.”

        * * * * * * * * * * * *

        It helps to have opposing views listed also, so people get both sides of the story and use their own judgement on where the facts actually fit.

    • Joe: From the AP just a few minutes ago

      Insurers Reassure Investors About Aca Exchange Business

      Health insurers rallied Friday to ease investor and customer concerns about the Affordable Care Act’s public insurance exchanges a day after the nation’s biggest insurer questioned its future in that still-developing market.

      Blue Cross-Blue Shield insurer Anthem and Medicaid coverage provider Molina Healthcare both said they are making money off their exchange business, and Anthem joined Aetna, the nation’s third-largest health insurer, in reaffirming its 2015 earnings forecast.

      “I think the (ACA) marketplace is going to be around for a while,” Molina CEO Dr. Mario Molina said.

      Shares of Molina and the other insurers all plunged Thursday after UnitedHealth Group cut its 2015 forecast, reported deep losses from its exchange business and said it will decide next year whether it wants to continue in that market. That followed reports earlier this fall that several smaller, nonprofit insurance cooperatives would stop selling coverage on the state-based exchanges, which are a key element in the ACA’s push to expand insurance coverage.

      Insurers in many markets have struggled to find the right mix of healthy customers to balance the sicker ones since the exchanges opened for business in the fall of 2013. Even businesses that reaffirmed their commitment have had some growing pains. Aetna said last month that it lost money last year on the business, and it’s in the red this year as well.

      But the insurer expects improvement, in part because it is learning more about the customers it serves through this business. That will help it set the right prices for future coverage.

      Anthem, the nation’s second largest insurer, said its enrollment in the public exchanges fell by 69,000 people to 824,000 in the third quarter. Spokeswoman Jill Becher said the business has been less profitable than expected.

      CEO Joseph Swedish said in a statement that the insurer remains committed to the business and “continuing our dialogue with policymakers and regulators regarding how we can improve the stability of the individual market.”

      The not-for-profit insurer Kaiser Permanente also said late Thursday that it remained “strongly committed” to participating in the exchanges. Kaiser covers about 450,000 people in nine exchanges, and a spokeswoman said they are confident that the business is financially stable.

      Molina said his company has been helped in the exchange business by expanding slowly and focusing on a customer base it already knows how to serve, low-income patients.

      “We’re not trying to be all things to all people,” he said.

      Even though some insurers have made money so far on the exchanges, industry analyst David Windley sees room for improvement. Insurers are still struggling to attract enough healthy patients, and the analyst said it’s too easy for customers to manipulate the system by doing things like signing up for coverage, using health care, and then stopping premium payments.

      UnitedHealth said Thursday it has been hurt in particular by customers who signed up for coverage outside the annual open enrollment window and use more health care in general than those who bought coverage during open enrollment.

      “The exchanges currently are an unprofitable, untenable book of business,” Windley said. “That’s an industry issue.”

      Aetna said Friday it still expects 2015 operating earnings of $7.45 to $7.55 per share. Anthem, which recent reaffirmed its forecast, said again on Friday that it expects adjusted earnings ranging between $10.10 and $10.20 per share.

      Analysts forecast, on average, 2015 earnings of $7.55 per share for Aetna and $10.20 per share for Anthem.

      The health insurance stocks that sank on Thursday all rallied Friday. Aetna climbed 4.6 percent, or $4.55 to $104.44 in afternoon trading. Anthem Inc. rose 2.5 percent, or $3.14, to $131, and Molina Healthcare Inc. jumped almost 7 percent, or $3.80, to $59.40. Even UnitedHealth Group Inc. did better than the broader market, rising 2 percent, or $2.18, to $112.81.

  6. The Evansville Redevelopment Commission is nothing more than an appointed autonomous division of city government, run by and for the local Chamber of Commerce, with the luxury of taxpayer funding of their projects. The only thing that stands between their champagne taste and Evansville’s beer budget is the common sense of 9 elected City Council members.

    So it is as plain as the nose on your face that the lack of sophisticated independent thinking council members, who never drill down into the financial data forecasts of those hired to grease the skids for these projects, and never call them to account when their data wildly misses the marks, are the primary reason Evansville is not moving forward, as it should be.

    The SINGLE move that this city could make that would do it the most good towards setting its feet back on the right path would be to abolish the Evansville Redevelopment Commission IMMEDIATELY, thereby breaking the stranglehold the crony capitalists have on Evansville, while disabusing this city’s government of the notion that they can create markets where no demand by the consumers exist. Taxpayers do not exist to subsidize private enterprise! If you want to clean this city up, if you want better streets, take the money you so willingly stuff into the crony capitalist’s pockets for projects that only benefit them and become a financial burden on the city for decades, and use that money to clean the city up and repair the streets.

    And why should taxpayers give another dime of tax money to the Evansville Museum until they sell that Picasso and put the proceeds into an investment that directly supports their operating fund? What is going on there? The delay in selling is beginning to cause people to wonder what the hell is going on.

  7. Goodbye Homestead credit, hello more water/meter scams, they will go to no end of treachery and unscrupulousness to cover the financial moose tracks. Winter this year will be a rough one, and there wont be money to make repairs or keep the roads clear.
    Yeah , Lloyd’s going to need luck, because his fat will be in the fire-nobody cares who you blame when you’re in the hot seat.

    • I expect you’re right. I am going to Florida between Thanksgiving and Christmas to check out some places to live. I won’t make a final decision until after the presidential election, just in case one of the Republican crazies gets elected. I don’t think it will happen, but anything is possible. My lease will be up and I am leaving this town before2017.

      • Good plan! ( une bonne planification!) Anyplace that can support the likes of that sexual predator {weaver pervert} is no place to try to reside safely. And from what I’ve read on this blog he is going to sponsor a woman that seems to be as dumb as a over ripe clump of washed up beach sago for your council president seat as well. (Sur la plage de mûre sagou) Besides the old town there smelt like someone on a black bean burrito jones while I was there, also. Its so bad along your riverfront it gets into ones clothes and hangs with you for a thousand miles even aboard our most modern aircraft today.
        Do look into Belize , its primarily an English speaking infrastructure supply based daily there.
        I’m multi linguistic so just about anyplace in the western world suits me. Love my home nation of my family though, we are at a human crossroads of many cultures. Today its getting a bit scary due to the terrorists and their dangerous incursions. In my region we’ve somehow kept our heritage throughout two devastating world wars. I can tell you something, America had plenty to do with that as well.
        We will endure what those evilest of people can throw our way today as well.

        Liberté, et de la force pour toujours!

  8. Isn’t the City/County? below the maximum rate for taxing income of workers from Henderson/Kentucky? I’ve always heard that Henderson/Kentucky has a much higher tax on workers from Indiana than we do on workers from Kentucky. If true, this makes no sense. A response from anyone that knows about this would be greatly appreciated.

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