Faced with a shortage of funds, officials in the town of Chesterton opted to hold back pay raises this year rather than requiring employees to begin contributing to the cost of health insurance.
"You got to give up something somewhere," Clerk-Treasurer Gayle Polakowski said.
While she does not believe the community to be any worse off financially than others around the county, employees in most of those other communities and the county itself enjoyed a boost in pay this year.
The widespread approval of pay raises among local government employees stands in stark contrast to the private sector, where companies are freezing salaries and even reducing pay to make ends meet and avoid or reduce the number of layoffs.
Not a single community in Porter County reported a layoff as a result of the recent downturn in the economy, though a few said positions are going unfilled.
Chesterton's decision to freeze salaries did not go unnoticed by Gov. Mitch Daniels, who called on all public employees to consider skipping pay raises this year to take the pressure off schools and local government and to show solidarity with their peers in the private sector, according to Jane Jankowski, Daniels' press secretary.
Every 1 percent increase in the pay for public employees across the state amounts to $100 million, she said.
President Barack Obama began his term last week by ordering a pay freeze for White House employees earning more than $100,000 a year.
Pay also was frozen this year for all state employees, including the governor, judges and lawmakers, Jankowski said.
The only other local community she knew of that bypassed raises is Dyer.
A survey done by The Times revealed there will be no pay raises in Dune Acres, while the communities of Beverly Shores, Kouts and Hebron have put off the decision until later in the year.
While government is generally more stable and less cyclical in a financial sense than much of the private sector, it does become vulnerable as property tax collections begin to fall, said Donald Coffin, associate professor of economics at Indiana University Northwest in Gary.
The rising number of home foreclosures and financial struggles among homeowners without a mortgage could add up to problems for local government, he said.
"It depends on how bad things get," Coffin said.
