CROWN POINT | Calumet Township Trustee Mary Elgin faces the prospect of having to slash at least $1.7 million, if not millions more, from a poor relief program that sustains thousands of Gary's neediest, but is accused of smothering Griffith's taxpayers.
Gov. Mike Pence signed into law Friday afternoon House Bill 1585, which puts Elgin on notice that if she cannot rein in her office's spending practices, the state may do it for her.
Elgin, who declined comment, previously told The Times she has a legal duty to provide assistance to all eligible residents, including shelter, utilities, clothing, medical care and school book payments. She has cut her budget to appease Griffith concerns, but Griffith taxpayers have a responsibility to the township's poor, she said.
Elgin also has complained her spending practices aren't as burdensome as depicted in state accounting reports.
Griffith Town Councilman Rick Ryfa, who helped lobby for passage of House Bill 1585, said the problem is real and the cure could be cuts in Elgin's spending up to about $4 million.
"Or, she could just tell Griffith to go ahead and leave the township and she would only lose the $1.7 million we take away," he said.
House Bill 1585 permits Griffith to leave Calumet Township if another adjacent township, such as St. John Township, accepts the community.
The legislation culminates years of lobbying by Griffith town officials to divorce themselves from a township trustee who they complained leans too heavily on their community of nearly 17,000 to fund social services in the neighboring city of Gary, which also is part of Calumet Township, where 1 in 3 residents lives below the poverty line.
Elgin's office spent nearly $88 million between 2004 and 2010. In the last four years alone, some 37,000 Calumet Township recipients received more than $21 million in emergency shelter, utilities, health care, food and burial services, according to state and township records.
Ryfa said his Griffith taxpayers have been taxed more than $1.7 million annually to support Elgin's poor relief operation, although the town's residents get back less than $11,000 of that for their own needs.
Griffith officials convinced legislators this year they and Elgin were unable to work out a compromise, so House Bill 1585 was born.
The law would only go into effect if Elgin cannot reduce the office's property tax rate funding Calumet's township assistance to less than 12 times the average of the state's 1,008 townships. It currently is at 22.6 times the state average, the Legislative Service Agency estimates.
Failure to meet the tax rate threshold in the new law could trigger two things: the state's Distressed Unit Appeal Board's oversight of the trustee's checkbook and, eventually, Griffith's potential departure from Calumet Township.
Griffith could leave Calumet as early as 2016 if two thirds of Griffith's residents ratify the move through a referendum.
Griffith's departure would force Calumet to tax its remaining property owners at an even higher rate to make up for the lost taxes, 20 percent higher, according to Legislative Services.
Township officials may have to submit to a special audit of all salaries and contracts to develop a plan to cut costs similar to one the board used to pare down the city of Gary's budget by tens of millions of tax dollars recently.