Lawmakers oppose Senate Bill 512

Thursday, March 19, 2009

It appears that State lawmakers are unlikely to do anything this year about the problems associated with township government.

Many lawmakers don't agree with the solutions offered including the elimination of township government.

Legislators who represent farms and small towns, as well as lawmakers with city districts, say their areas have special needs that are better met at the township level.

The issue is Senate Bill 512, which originally called for the elimination of township government. It was amended and now includes a provision that ends nepotism in township government.

"Anytime you use taxpayers' dollars you have to have standards for employees and contracts," said Sen. Connie Lawson, R-Danville, the bill's author.

The issue isn't just about policy. It's about politics and it is about nepotism in Indiana's 1,008 townships.

According to a recent article in the Sunday edition of the Indianapolis Star, two-thirds of township trustees had a relative on the payroll. This sample was based on an examination of 617 townships in the state.

The article went on to say, "In addition, those relatives received more than $1.4 million in taxpayer money -- a conservative estimate of the overall picture that, like other aspects of township government, is nearly impossible to ascertain because of the autonomy of trustees, lax oversight and inconsistent record-keeping."

Many state lawmakers take part in local-level political parties where townships play an active role. Nearly a dozen of current state lawmakers began their political careers in township government.

Indiana's 1,008 townships employ thousands of people making millions a year. Although they would not all lose their jobs if township governments were eliminated, the potential loss of a steady paycheck in a down economy has helped the opposition.

No reforms have passed both the Senate and House. Legislation to deal specifically with the nepotism issues was amended and passed in the Senate.

In the House, Democrats tried to return the bill to its original state, only to then vote it down.

At the same time, Senate 506 that would eliminate county commissioners, replacing them with such options as an elected county executive, a board of supervisors or an expanded county council, did not pass.

State Representative and former Greencastle Mayor Nancy Michael has stated that she believes a better job of educating citizens is necessary to help them understand the need and type of reform necessary to ensure effective and efficient government.

"I believe the public is more concerned about jobs, fair taxes and getting our economy back on track," she said.

She cited the latest unemployment figures showing Indiana's rate is 9.2 percent.

"Putnam, Parke, Clay and Vigo counties have all reached unprecedented high levels of unemployment. We must be willing to recognize that essential services at the local level are needed more than ever," Michael said.

Michael suggests that job creation and retention should be our first priority, followed by expanded tax relief, education, health care, funding for local roads and streets, higher education and services that help families and children.

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  • To meet the IRS standard to be a philanthropic organization, no more than 25 cents of every dollar can be spent for administration and no less than 75 cents for benefit. No standard is required of Indiana townships. The township board has much legal discretion about compensation for the trustee and trustee household including trustee salary and benefits, spouse salary, taxes, rent, and utilities.

    * In Putnam County, for every property owner tax dollar provided to the township, 78 cents is administration and 22 cents is assistance. In Greencastle Township the ratio is 61 cents to 39 cents; in Warren and Madison Townships the ratio is 94 cents to 6 cents.

    * In every Putnam County Township, the compensation for the trustee's household (salary, benefits, spouse salary, taxes, and rent) exceeded the assistance given. On average the trustee household compensation was three times the total assistance given. In Warren Township, the trustee's compensation was 15 times the amount of assistance given while in Madison Township it was 14 times.

    * In Putnam County, the 2008 compensation for the Washington Township trustee's household was over $27,000.00 and included nearly $15,000.00 for health insurance premiums and taxes. During the same period, Washington Township provided $3,949.00 in assistance.

    Indiana trustees have much legal discretion about whether to grant assistance and if so, the amount. As a consequence, the average assistance per household varies widely among townships.

    * In Putnam County, 274 households were provided benefits averaging $199.00 per household per year with a high of $1,181 in Jefferson Township.

    * In Putnam County, the total assistance provided ranged from a high of $20,261.00 in Greencastle Township (population 12,491) for 141 households to a low of $598.00 in Warren Township (population 2,788). Jefferson, Warren and Madison Townships each provided assistance to three households.

    Many Indiana townships have cash and investments far in excess of their yearly expenditures.

    * In Putnam County, yearly expenditures, minus fire capital, were $390,784.00 while cash and investments were $666,653.00. In three townships, Warren, Marion, and Jackson, cash and investments were nearly five times the yearly expenditures.

    The Indiana State Board of Accounts monitors compliance with laws and regulations during every-other-year audits. However, the SboA only reports; it does not enforce. Consequences for failure to comply are seldom enforced. For example, failure to submit the annual fiscal report to the newspaper is a Class C infraction; to the auditor is punishable by a fine of $5.00 per day; to the SboA is grounds for non-approval of the budget. As of 3/6/09, the SboAhad not received 200, or 1/5, of all Indiana township fiscal reports.

    * In Putnam County, all townships had negative audit findings. Marion and Russell Townships had eight or more negative audit findings. Although the annual financial reports are the only source of public information and accountability, the trustees of Cloverdale and Russell Townships failed to provide them.

    -- Posted by townielove on Fri, Mar 20, 2009, at 5:18 PM
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