Schneider: Small town, big financial troubles

SCHNEIDER | State officials warn this small southern Lake County community faces an bleak future if it cannot get its financial books back in order.

"There is substantial doubt about the government's ability to continue as a going concern," the Indiana State Board of Accounts stated in an audit made public Monday.

Schneider Town Board President Richard Ludlow said the picture isn't nearly that bleak.

"It was bad. You can see in the audit our last five years have really hurt us and put us in a hole, but every town in this area is in trouble, and when what little you've got gets misspent, that really hurts you," Ludlow said.

"We are trying to dig out of it and now it's in pretty good shape. Our new clerk-treasurer has a college degree and has done a lot in two months."

The audit says Schneider ended 2011 more than $729,000 in the red. It observes the town's utilities services are not receiving enough income to pay its bills.

Ludlow said that includes $105,000 debt for a firetruck the town had to assume when the local fire service went bankrupt, and hundreds of thousands more in borrowed money to upgrade the town's utility infrastructure.

State auditors said financial records were incomplete and the town had a pattern of delinquent bill-paying that generated more than $9,100 in late fees.

The audit recommended Ray Bowman, a former town clerk-treasurer, pay restitution for the late fees. Bowman couldn't be reached Monday for comment.

Ludlow said town officials have spent thousands of dollars and a year and a half to reconstruct its financial books, which disappeared when the computer containing them crashed.

Lake County Commissioner Gerry Scheub, D-Crown Point, said he will be glad to meet with Ludlow and consider any potential solutions, but added the county is in no financial shape to take over town utilities.

County Councilman Rick Niemeyer, R-Lowell, said town officials may have to explore dissolving town government. But Ludlow said disannexation would result in the town's 277 residents being stuck with immediately repaying the town's debt.

Ludlow said there isn't much of a town budget to cut. "We only have one employee in the clerk's office and two in the street and water department, and a town marshal. The rest are all volunteers.

"This is the main reason we are still working hard to get that ethanol plant here," Ludlow said, adding Evansville developer Earl Powers recently assured him he still intends to build a $300 million plant to convert garbage into biofuel in the town.