Tight budget means Portage will wait until 2013 to pay some vendors

2012-11-11T18:30:00Z 2012-11-12T12:34:03Z Tight budget means Portage will wait until 2013 to pay some vendorsJoyce Russell joyce.russell@nwi.com, (219) 762-1397, ext. 2222 nwitimes.com

PORTAGE | City officials are keeping their fingers crossed that no significant emergency happens between now and the end of the year.

They just can't afford it.

Clerk-Treasurer Chris Stidham said, based on anticipated revenues and expenditures and some year-end savings measures, the city will have a cushion of $68,903.

Stidham said with cash on hand now and revenue through the end of the year, including an anticipated late December property tax draw, the city would have about $9.7 million in funds available. However, between what's been appropriated — or already authorized to spend — and a payment to the Indiana Bond Bank due Dec. 31, the city needs just more than $10.4 million to meet obligations.

That leaves a deficit of $683,268.

"If everyone spends what they have authority to spend on the appropriations report, we will be bouncing checks," Stidham said.

The City Council this week approved reducing appropriations in the general fund by about $160,000 and in the economic development income tax fund by about $23,000.

The Park Department also had the foresight to encumber some $127,000 in February because of budget issues, he said.

In addition to reducing the appropriations, Stidham said city officials have put a hold on unnecessary spending.

That will lower the expenditures enough to give the city its $68,903 cushion.

"In a city with a budget of over $20 million, you don't want to have a cushion of $68,000," Stidham said. "We never let the bank account go below $500,000 because that's about what one payroll costs."

Stidham said to help sustain the cushion, some vendors will have to wait until 2013 to get paid.

"We will have to prioritize who gets paid," he said.

Mayor James Snyder said, "This is nothing new the city is going through. We went through this last year."

Snyder, who came into office facing bills left over from the previous administration, said it could be worse, but his administration has taken some steps to help get the city's spending under control. The city has changed health care insurance providers and offered early retirement buyouts to employees to reduce costs.

Stidham said the city has 14 fewer employees now than it did at the end of 2011.

Earlier this year Stidham projected a $1.9 million deficit for the city. The Redevelopment Commission shifted $1 million in its funding to the city to help fill the gap.

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