RIECKEN CHARGES THAT WINNECKE CONTINUES TO DENY CITY HAS SERIOUS FINANCIAL PROBLEMS

Reading the article from the September 29th newspaper about the transfer of casino and rainy day money reminds me yet again that the city has a serious financial problem that Mayor Winnecke continues to deny. He uses the bond rating and audits to proclaim a solid financial situation. He is confused on the issues. In his September 12 Letter to the Editor he said, “It has been confirmed time and time again by the state’s independent audits and the independent bond rating agencies that the city has operated in a financially sound, efficient and prudent manner.”

Even if you take Winnecke’s position, he cannot make that claim. The audit for 2014 has not been completed by the State Board of Accounts, so no one has any idea where we stand. Also, it was the dissention over the 2013 audit last year that caught many people’s attention, including mine, that something is wrong with the finances. As for the hotel bonds, why weren’t they higher? After all, payback is guaranteed with casino and COIT (local income tax) monies, just like the arena, which was rated higher than the hotel.

The reality is the city is not financially sound. During his term, the Mayor has decreased the city reserves – with the starting general fund balance going from approximately $4,000,000 to $307,000 in in just three short years. At the same time, the Mayor has increased the city’s debt from $396 million, to $514 million by the end of this year. That is $4,278.32 dollars of debt for every man, woman, and child in the city of Evansville.

Just to stay in the black for 2014 and continue to paint the picture that all is well, the Mayor shored up the general fund with a $2,400,000 advance from the water and sewer utility. Now, we see the Mayor had to borrow from the casino monies and emergency rainy day fund. He has no reserves, he cannot control spending and he does not plan to.

One indicator of government spending is efficiency. There is a table of comparisons on the Gateway Indiana website. From 2012 to 2014, looking at the per person efficiency rates of the top four cities of comparable size to Evansville, Fort Wayne cut their per capita spending by 1.66%. South Bend raised their per-capita spending by .72%. Indianapolis cut their per-capita spending by 4.82%. Evansville increased per capita spending by 4.98%! That is spending $1,877.14 for every man, woman, and child in the city of Evansville. Not only are we the highest in spending, we are way out in front, and the spending is spiraling out of control.

The other issue that came to mind about the City Council meeting on Monday was how the administration refused to tell us exactly how the monies to the casino and rainy day fund will be repaid. If you spend more than you take in (about $600,000 per month) and the November tax monies must help pay the bills till next property tax monies, you tell me how the Mayor is going to pay back the monies.

You can’t ignore the fact there is a shroud that covers the details, whatever the issue, such as why the administration left one accounting method that gives a true picture of the finances or why the council and the public could not get solid financial information on the hotel project.

Time and time again we hear Mayor Winnecke say that “Since taking office, our administration has spent less than what has been budgeted by our City Council every year.”

This has been the rallying cry of Mayor Winnecke in 2015. However, the details are that he absolutely spent more money than he has brought in (from controller’s financial books). He greatly over-projects revenues during budgeting, and then recognizes the over projection later in the year. However, the problem is, when the revenues are reduced and not coming in, the Mayor does not address reducing spending to be in line with the actual revenues the city is receiving.

Evidence is a budget meeting in the mayor’s office in August or early September of 2014. Mr. Hedden of Umbaugh was on the phone with Councilmembers Dr. Adams, John Friend and Conor O’Daniel, the Mayor. Controller Russ Lloyd and Steve Schaefer. There was one more person from the Controller’s office. In that meeting Mr. Hedden said that the Mayor Needed a spending plan. There has been none to date and it is over a year later and millions more wasted.

The Mayor has nothing in his checking account, and rather than trying to curtail the spending, he simply looks for other bank accounts he can borrow money from to continue his spending spree. If we truly want to get our city back in strong financial standing, we must change the philosophy of government and that means starting with a thorough assessment to find out exactly where we stand financially, department by department. Then we must create a spending plan and a strict budget to make sure that we know where every dollar is. To move forward we must have the continued resources to do so. That means conserving and spending wisely.

Our “cash flow” issue that was addressed at the September 28th City Council meeting is not a cash flow issue at all. The Mayor cannot boldly claim we are financially strong when all evidence is to the contrary. There is an over-spending problem that Mayor Winnecke must face.

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