The
entire financial issue came up in my first campaign.
It was sort of strange. It wasn't somebody taking money from city coffers, or misusing city property, as has been the issue with some past administrations.
Instead, it was a concern in general with the way the city was handling its finances. Some economic development projects went bad, like Micro Standard, where $1 million was given out to a fledgling company and never repaid. The public had some sense of these problems and how they tied in with other concerns about how honest and straightforward was Win Moses Jr. And it all tied in with the campaign finance reporting fraud allegations Moses was charged with, and eventually plead guilty to, that maybe the city's finances weren't being taken care of as they should.
The economic times of the mid-1980s were tough. As a result, the city was doing things a bit more creatively to attract industry and jobs. Where Win was trumpeting his creative financing, people started to look at it as smoke and mirrors. There was a big question mark hanging over the city's finances when I came into office.
What shape were we in?
So, what kind of shape were we really in financially? I wanted to be very careful and not lock myself into a "no new taxes" pledge. I wanted to keep open my options until I looked at the books. The new controller, David Silletto, and John Stafford, my chief planner, started to look at the situation and found ourselves with concerns. The city's cash balance at end of 1987 for day-to-day operations was $84,000.
I remember one meeting where we talked about our financial shape, and it struck us as not a lot of money. Obviously, as an individual, I'd love to have $84,000 in the bank. But Silletto noted $84,000 was enough to run the city until 3 p.m. on Day One. And that's it. It's not a very healthy cash balance.
Meanwhile, the utilities were not in good shape; they had a pooled cash arrangement. A lot of the cash for the water and sewer utilities was pooled so it looked like you had enough when you had to buy something. But, in effect, you kept borrowing from the same pot and shifted around the money. Thus, the utilities were pretty much in the red; the civil city side is pretty much out of money as well. Our bonded indebtedness showed a lot of them had balloon payments at the end coming due within that year or next. There was a backlog in projects and petitions from homeowners to the Board of Works for neighborhood improvements.
The first hint of bad news came up during the election when Moses proposed a budget for 1988 that contained a 3 percent property tax hike. Earlier in his second term, Win made a big deal about not raising taxes. And then when the city raised taxes by 3 percent in an election year no less, it struck me as a sign of danger.
We needed to respond quickly and put together our fiscal recovery plan. We dealt with the issue of a local income tax. We looked at cost-cutting, like self-insurance and doing away with take-home cars for department heads and other top officials. Those were supposed to save close to $1 million.
We adopted a position of no salary hikes for the next year, and some utility rate hikes to take care of that side. The biggest one, however, was the income tax.
Income tax
A local income tax never seemed to be much of an issue during the campaign. I believed it wasn't something we needed at the time.
But when I got in, Allen County was pushing for the County Option Income Tax to help its financial situation. When I found out our situation, I got behind COIT right away. The tax had to be adopted by end of March 1988; it was a tight timetable. The City Council was the deciding group over COIT.
County officials came before the City Council at a public hearing to push for COIT because the county was spending a lot on the criminal justice system.
Supporters also noted what this tax could do for other units of government. Our arguments focused on the city's needs as well; we lobbied for it.
However, Moses was in town and got the Democratic-controlled City Council against it; he was posturing a bit. When Moses was mayor, he said there would only be an income tax over his dead body, even though I don't remember the income tax being such a big issue when he was mayor.
But his opposition argument to the council made it tough for tax supporters. I recalled Win saying with him being out of office and unemployed, the tax would become burdensome. But Win had some healthy income and assets from his business interests so I'm not so sure about that argument.
And it struck me Win had it backward. If he were truly unemployed, having an income tax would be better. If property taxes had to go up, it would raise the taxes on his nice home on Westover Road. But if we had an income tax, and he was truly unemployed with no income, he wouldn't be paying anything extra.
Politics and posturing
It was more the politics and posturing of the matter that scored points. Headlines at the time were more about Win fighting back against Helmke. Some of the charges he made were we didn't understand finances and how things worked. It came down to City Council; we ended up losing 7-2. But it was a vote we felt we had a chance to carry. Once you lost one person, you lost others pretty quickly. One of the crucial ones was David Long, and I remember speaking with him once at the office about the tax right before the vote. And David had to walk around the block afterward to think about it. We ended up not getting his vote.
Our hopes to get others were lost, and we couldn't get the five votes necessary to pass it. It went down and that was very disappointing. It meant we had to try harder with other cost-cutting moves.
Looking back, we made such a big deal of cutting $1 million that first year. Yet years later, people still said we did nothing to tighten our belts. It's the frustrating part of government; you don't get the big headlines from self-insurance, from cutting this or cutting that. Even when you do, nobody remembers a year later when the furniture's falling apart in the City-County Building and you're trying to make ends meet.
Tax study
We started to lay the groundwork for the income tax in the future by creating a blue ribbon committee, including Mark Rosentraub from Indiana University-Purdue University Fort Wayne, for a real outsider's and expert's look at the city's and county's budgets.
The group came back in December 1988, and I was surprised by it. It said the county was in better shape than the city and the city really needed to diversify its tax base. We had heard so much about the county's problems we maybe never knew to what extent we were in trouble.
The study did some long-range projections that found assessed valuation growth that fuels property tax revenue was occurring outside the city. And it found tax abatements for economic development projects in the city meant dollars weren't going to be there for a while.
As a result, we used the study to push for COIT and why the tax made sense.
Everybody pays
I'm still fighting this battle today when I'm accused of raising taxes so many times as mayor. The point I was making at the time was that 60 percent of the city's income came from property taxes; the rest, from fees and other sources.
By putting the tax burden on the homeowner, we were hurting them and ourselves. We were hurting the individual because you're paying the property tax regardless of whether you have a job, and you owe the tax regardless of your cash flow. An income tax meant you wouldn't be paying it unless you had income and more only when your income went up.
For the city, an income tax was better. Everybody in the county would be sharing the tax; it helped balance inequities between city and non-city residents with better distribution based on your property tax levy. And it would allow the city to keep the property tax low in Fort Wayne.
Nobody likes taxes; they should be geared for those who benefit from government services. You get those who live here with a property tax, those who work here with an income tax, and those who shop here with a sales tax. Indiana doesn't allow local government to do a sales tax, but it could do the others.
The most crucial benefits meant all your eggs weren't in one basket; there was diversification. A property tax will stay generally flat; it'll stay just about the same whether the economy is going gangbusters or not. An income tax will go up when times are good; down when times are bad. We had hit rock bottom with the economy around 1983-1984. Now, we were on the upward swing but the city wasn't getting much of the benefit of the economic prosperity because it was reliant on the property tax. To me, the Moses administration was doing a lot to pump up the economy with economic development yet the city's coffers weren't benefiting from those extra and higher-paying jobs.
With the economy strong nearly throughout the 1990s, we've been able to benefit from the income tax. And it helped us keep the property tax low.
COIT redux
So, when it came to COIT a second time around, we used a different strategy. We basically ignored the county, townships and other units of government who stood to get some money from COIT and concentrated on the city with a plan I was confident City Council would pass. If passed, we pledged to keep property taxes down and we ended up keeping those taxes frozen for some time.
We also phased in a local homeowner's exemption at 8 percent, which took that much off the entire property tax bill. While the rate stayed flat, for the homeowner there also was an 8 percent tax break. We put this in and we kept it there.
As I look at my personal property tax bill, and with the city about a third of my bill, my taxes have basically stayed flat over the last decade.
Also, we created a pool of funds for the six council districts for neighborhood improvements. It helped move some of the backlog of petitions for improvements in neighborhoods by setting aside a fund of money just for that use.
'Pork barrel' politics
Also, it was a little bit of congressional "pork barrel" politics. By having COIT money to spend on improvements, it gave district City Council members money they could take back to their constituents and say, "I've delivered. Here's the funds and we can do these projects."
It tied in with community-oriented government because it empowered people more in the decision-making process. It put more power back in the neighborhoods.
It used to be neighborhoods would come to the mayor and say we need this done, and we'll try to marshal our political clout to put pressure on you to get it done. The mayor would feel the pressure. The mayor would hurt people if they were turned down, and made them happy if the projects were approved.
With this new pool of COIT funds, the pressure was put on council members and neighborhood residents, who would petition their council member for improvements. In effect, it took some of the political heat off me while I still got credit for the projects because I was the one who had pushed COIT.
It really got the neighborhoods working together as well; no more, "I'm on my own against the rest of the city." Instead, it made neighborhoods aware although their streets might be bad, their neighbors next door might have streets even in worse shape. So we'll fix yours this year and we'll do mine next.
It was a whole different mind-set where neighborhoods had to make priorities for a limited yearly amount of money for improvements. It really started to change the mind-set of politicians and homeowners. They knew the money would be there, and working with other neighborhoods, could get something done.
It was a great package, but we still had a tough time getting COIT through, with 5-4 passage by the council. We were sweating bullets until the council passed the tax.
Last-minute roadblocks
I still remember Jimmy Stier of the 6th District, who at nearly the last minute, asked council attorney Stan Levine to research COIT about some technicality. And the auditor was supposed to file some documents before the tax was passed. But an issue came up whether the auditor had done it, and it came up as a surprise move. I remember having to track down Auditor Linda Bloom, who had an unlisted number, and had her sign an affidavit to get on file to show the tax was being done according to procedure. But we almost lost on a technicality.
I consider the passage of the tax one of the most significant things we had ever done. While the tax remained an issue for some time, 10 years later you don't see anybody campaigning for mayor or City Council saying to get rid of the income tax or roll it back. It's something folks really accept and realize it helps the city.
Politicking council
Part of the whole COIT vote was the issue how I dealt with City Council. This was a major piece of legislation, very public and controversial. Here, I'm a Republican with a council that's seven Democrats and two Republicans. It's obviously a difficult thing to get through. Part of what we tried to do is work with council on proposals they'd be willing to support, like neighborhood improvements.
With local issues, party lines very rarely define votes. But with Moses just out of office, it had a lot of potential for partisan vote. Part of my theory was that council was Democrat for so long, it no longer was a cohesive unit and had fallen into factions. So we weren't stuck with a two-Republican, seven-Democrat split on issues, but with two Republicans -- who sometimes didn't agree with me as well -- and seven Democrats with their own shifting coalitions. We worked with Tom Henry, for example, and his coalition wasn't always the same as the Mark GiaQuinta-Jimmy Stier coalition.
For me, the challenge was to keep the two Republicans together for a crucial vote like this, and get three of the seven Democrats to go along. It worked well later on when there was less partisanship and less suspicion.
But the COIT vote still had the partisanship with it. Jimmy Stier was the good, traditional Democrat trying to keep together what Win had talked about. Tom Henry was more of an independent and somebody we worked closely with.
Utility woes
The utilities, meanwhile, also were part of the fiscal recovery plan. We pushed for a sewer rate hike in 1988. The reality? We were in bad shape. With COIT defeated in 1988, we needed to deal with utilities directly as well to determine what was needed. Pushed for a pretty major sewer rate hike, about 25 percent.
Interesting enough, the situation pointed out how bad of a shape we were in with some of the lowest rates in the state. We were in lousy shape with our cash flow and our balance sheet. We were in a poor position to do a bond issue because we were not healthy enough financially. The poor position would have gotten us a low bond rating that would have cost ratepayers even more. The system itself was failing in places. As a result, it was easier than other areas of government to show how bad things were and what needed to be done.
It was hard to let homeowners see how bad things were; we needed to make an issue they'd believe in. It was no longer just an accounting issue; we couldn't fix the sewers unless we had more money to spend on it. Fiscally responsible meant you had to have the revenue to cover what needed to be done.
Stock tips
One of the reasons we used the city's longtime utility adviser, Municipal Consultants, to help with the rate increase was because its top guy, Bernard Perry, did a good job and he had a good rapport with council. As the new guy on the block, I needed to make sure council had someone else it could comfortably deal with on the rate hike issue. And Councilman Paul "Mike" Burns had a good relationship with Perry; Burns, a utility expert, was opposed to almost anything going up. So we believed if Perry could persuade him, we could get things through.
It didn't hurt that Burns always wanted stock tips from Perry, especially after meeting with him on utility matters.
Burns was against the income tax because his property taxes were very low. He had a small house and lived frugally. With his investment income, however, he did very well, so COIT affected him a lot more.
But as a former mayor, Burns knew what the utility needed to stay viable.
The politics of rate hikes
There had been a few rate hikes, normally single-digit, in the past. Past politics dictated rate hikes not exceed single-digit because it would look bad with voters.
We went in the first year and said we can't play these games anymore because we wind up with things falling apart. If we don't bite the bullet and pass an increase that works, the situation won't improve. I wanted the consultant to tell me what was needed, and I was willing to follow the number even if it wasn't popular politically.
About the only time I intervened was when, for example, you were at a suggested 30.1 percent rate hike and I would push for a 29.9 percent amount. It's the old marketing tool: always choose the lower number.
However, I believed the general public really didn't differentiate much or give you as much political heat if it was a 37 percent rate hike vs. a 31 percent increase.
Instead, the instructions were to do what was needed to get things right, and I'd pay the political heat to push them through.
So, here's the push for income taxes, higher utility rates, a property tax hike for 1989, and people were saying it was politically controversial. It was a time George Bush was running for president and saying "Read my lips." Evan Bayh was running for Indiana governor on talk of "no new taxes."
Do the right thing
I remember folks coming to me and saying, "Helmke, what's wrong with you? You have a GOP president saying read my lips, a Democratic governor not raising taxes, and you're raising taxes and utility rates."
My response was you do the right thing. Politically, it would be great not to have to raise taxes but we were in such bad shape, the situation was really perilous for the city and things needed to be done.
The politics of taxes
The income tax reared its head politically in 1989 during the special election for Congress.
One of my political strategies was if you have tough things to do, like adopt a new tax, do them early. There would be some pain, but you'd see benefits shortly thereafter. And by the next election in 1991, people would see roads getting fixed and utilities in good shape because of the extra tax revenue.
However, we had a special election in early 1989, and it threw a lot off that strategy. Sen. Dan Quayle was chosen vice president, Rep. Dan Coats takes over as senator, and there's an open congressional seat, with all this happening at the end of 1988. This is right at the time I'm getting the report on the condition of the city's and county's finances and am pushing for a utility rate hike.
It affected me several ways: I had to determine if I wanted to run for Congress. I had run once in 1980, and it's something that sounded interesting. But I had just been elected mayor and had been in office less than a year. Voters didn't like politicians who shift gears and keep running for something else.
Also, I believed the income tax was a hot issue, along with the St. Joseph Township annexation, and if I ran for Congress, those issues would become politicized, at least on the City Council level. The tax would not be passed by a Democratic City Council. No way was the council going to approve major initiatives from a Republican congressional candidate.
So I decided not to run. But Dan Heath, my safety director at the time, decided to run. He was closely aligned with me; Heath used some political muscle to get himself nominated by the GOP caucus. Folks thought it couldn't be done; that I was weak because of these controversies and thus Heath would be a weak candidate for Congress as well. But getting him a victory from the caucus showed I had political clout.
Then, during the special election against Democrat Jill Long, she hammered Heath on the income tax and on annexation. Those weren't issues relevant to the congressional race, but that's politics.
Pretend you don't know Helmke
Heath was getting advice from the national GOP campaign people. The message was: You don't know who Paul Helmke is and don't have anything to do with him.
Heath had been a part of my campaign and my administration, and really I believed he had gotten the nod from the Republicans because of what we've done. I don't mind taking political heat if someone can win, but I believed it was bad campaign advice from the national folks.
The way to respond about tax grabbing, for example, was to blame it on the sad financial situation we had inherited from the Democrat Moses. The simple way was to blame it on Win.
If it's horrible Helmke is raising sewer rates and starting an income tax, my response was to say the situation financially was horrible, and the Republicans had to come in and clean up the Democrats' mess. Instead, the national advisers said to Heath, "Pretend you don't know who Helmke is and keep him in the background." Instead, they told Heath to run on the Dan Coats-Dan Heath connection from his ties working with Coats.
The advisers believed their strategy was going to win, and it didn't. By politicizing these issues in the national election, it made them more radioactive than they would have been otherwise. They took on a taint of partisan politics for years. If there hadn't been the special election or had it been handled differently, maybe I wouldn't have had the continued flak over taxes and annexation.
No dumb politician
I'm not a dumb politician; I know nobody wants a reputation as someone who raises taxes. I had to explain what I was doing in the context of the future of the community. Most of these speeches defending myself wound up being said before Republicans. Just because Republicans believed in smaller government, and as a result, less taxes, it didn't mean sewer and water lines didn't need fixing. You still need to do these things on the local level.
Instead, a lot of people generalized "Republican" just stood for fewer taxes. I tried to argue Republicans stood for trying to solve problems on a local level, not always from Indianapolis or Washington.
On the local level, if I said you needed a tax hike for more police, next year you'd see more police. It's a difference from the state or federal level where you pay taxes in hope some of the money trickles down for local police.
It was one of the toughest things for me to deal with in 12 years. It goes back to 1987; I was seen as a good strong Republican. People wanted Win out and I was seen as a good candidate. But when the tax and annexation issues came up, there was the perception Helmke doesn't fit what we want. I've had to continuously argue what Republicanism means. If we argue we want a smaller federal and state government, and power back at the local level, the local level has to have the tools to deal with the problems. And sometimes it means having to raise taxes or utility rates.
Republicanism
And Republicanism means you want fiscal responsibility. Smoke and mirrors, deficit spending, back-ended bonding -- those sorts of things and gamesmanship Republicans don't like. It's the concept of the balanced budget, not just cutting, but getting it into balance. Some of it's through cutting; some of it could be by raising rates.
So, if you've got needs that need to be taken care of, you take care of them as much as possible with current dollars. You make the bonds as short as possible when it comes to borrowing. It means doing things the right way. But when I got criticized for doing things the right way, either by raising taxes or supporting a new income tax or higher utility rates, I had to argue for my version of Republicanism.
As a result, we set up an income tax at 0.2 percent of the adjusted gross income of every wage earner in Allen County, with 0.1 percent yearly increases, to make it easier on taxpayers and to avoid sticker shock. The bad thing about how the tax was set up is that one tax decision helped paint me as a continuous tax-raiser with five tax hikes for each incremental increase. With the county option income tax set up to go all the way to 0.6 percent, it became "Helmke raised taxes five times." It's hard to respond; I could have easily have said let's start it at 0.6 percent, and then it would have been one tax hike. But it would have taken more money from your pocket.
Incrementally is fairer to the taxpayer, but it ends up being five hikes instead of one. We could have almost argued that I could have gotten away with no new income tax, but left unchanged for 11 years a higher property tax rate and the city could have gotten even more revenue. Instead, we lowered the property tax rate in exchange for the income tax.
Local tax reform
By leaving property taxes at a higher level, it would have been more of a burden on the property owner, tougher on economic development, and a burden on the senior citizen. We did a tax reform package. It wasn't just getting more dollars, but moving the system from property taxes to a reliance on several sources of revenue.
I got no credit for the fact the property tax rate was 13 percent lower when I left office than when I started. Also, we instituted the homestead exemption which lowered homeowners' tax bills even more. But to my political opponents, I still had 3 or 4 property tax hikes in a dozen years.
Why? Because one year we lowered it to a 30-year low based on state estimates and those numbers proved not accurate. So the next year, we had to go back to where we were before. As a result, over the two-year period, we ended up at the same spot. In one year, there was a big tax cut nobody remembers. Instead, they said afterward, there's another Helmke tax hike. Yet all it did was bring back the rate to where it had been before. But it's all part of the political games people play.
CEDIT and COIT
With COIT, and then the county economic development income tax, we took both up to a total of 1 percent. We moved from COIT to CEDIT because it gave the city more dollars based on the distribution formulas of COIT. For every dollar collected under COIT, the city was maybe getting 40 percent. With CEDIT, the money was distributed to other local units of government differently, and we were getting 60 percent from every dollar. If I'm going to be blamed for every $1 coming from your pocket, and I'll be blamed whether it's called COIT or CEDIT, I'll take the 60 cents for the city instead of the 40 cents.
The city also got penalized for lowering property taxes. What hurt us is by lowering our levy -- the amount of revenue a unit of government can generate through property taxes -- we got a smaller percentage of the COIT distribution, while other units of government, like the county at their levy limit, weren't penalized. If I hadn't put myself on the line and taken the political heat, the county wouldn't have gotten any of this new income tax revenue.
COIT, as a result, was capped at 0.6 percent; the rest, or 0.4 percent, was CEDIT.
If we hadn't had the income tax, property taxes would have gone up or services would have diminished. There was money, $450,000, in each district for improvements for neighborhoods. COIT and CEDIT were here to stay and they've been good for the community.
Sewer and water rate hikes
Sewer and water rate hikes also were more of the same controversies -- two or three hikes each for water and sewer in my 12 years. I tried one each in each term.
On the water side, the gorgeous limestone filtration plant was beginning to show its age. The laboratory was something out of the 1940s. A lot of fixing was needed. There was a lot of deferred maintenance.
We pushed through a rate hike in the 30 percent range. So in my first re-election campaign against Charlie Belch, Belch was making some noise about how we were putting in stained glass, spiral staircases and a wet bar at the plant. Instead, we were putting in glass that was for safety purposes. And in the lab, you put in faucets and stainless steel sinks because that's what a chemistry laboratory needs. But for politics, we were putting in stained glass and a wet bar. We had to point out to people that's not what we were doing.
The danger in public life, if you make tough decisions, you'll be attacked from every angle. It comes from Republicans for raising rates; the same with Democrats, the media and the public. You need to spend a lot of time laying the case for the need for such improvements.
Politicians attacked me. But when I walked neighborhoods every Wednesday night the first six years, a good exercise that kept me in shape, only once did somebody attack me on taxes. One person in six years raised it as an issue. And that's amazing.
People want improvements
It's not to say other people didn't care about it, but those issues are not what they complained about when they had me on their front porch. Of course, if you ask in a poll, do you want taxes to go up, the answer almost always would be no. But when you talk to people, they said we need more police, better streets, and that the sewers were backing up. Usually, they said there were needs we hoped the city would address. At some level, it's easy being mayor: I told them if you want something, you are going to have to pay for it. If you don't want to pay more, than you're not going to get it.
People would tell me there were things they wanted and those things were more important than the amount of taxes they were paying without the improvements. On the local level, you see a lot more clearly how your dollars are being spent. And most people accepted the increases. Every time I ran, the numbers went up. Folks accepted the improvements even if it meant paying more.
Looking underground
If your water and sewer utilities aren't in good shape, you often aren't going to see a problem. It's why we made a big deal early on about the condition of the Three Rivers Filtration Plant; we could get the cameras inside to show it was falling apart. But you can't get cameras to film the problems underground, at least not very well.
We tried different ways to get people to see what we were dealing with and to show there was a need. There were a few things we did; one of the most valuable ones weren't planned.
One, we used our Geographic Information System, a computerized mapping system, to show where water and sewer main breaks were occurring. The mapping system helps makes the case by showing graphically where problems are occurring.
The first time we had it done, I assumed the older the line -- and some were over 100 years old -- the more likely they'd break. But the lines that were breaking the most often were those from the mid-1950s/early 1960s. One of the theories was that Paul "Mike" Burns was mayor at the time and he was known for being parsimonious. But I don't think that was the case. Instead, it was the kind of pipe being used which wasn't as good as the older material that had been used in lines before.
Lillian Avenue
The most obvious problem occurred in 1995 when Lillian Avenue residents started to get a lot of backup in basements. We had started looking at the combined sewer overflow issue some time before then, and had known it was a problem. The federal government was telling us about environmental concerns. The economic development folks kept telling us it's a problem as well. We had red and green zones for development based on an area's sewer capacity and condition. This showed how development could be affected because areas had a system that couldn't accommodate new construction. The Georgetown area, Southwest and around the airport, for example, these were red areas that couldn't take on another car wash or another business.
But the clearest problem area was on Lillian Avenue. We actually had dealt with the issue in 1991 when we created a sewer fee to help pay for storm water runoff. Whenever we had a big flood, the focus would be on the rivers where folks hoisting sandbags got the publicity. But there also were flooded streets that didn't get focused on because of the rivers. Heavy rains causing street backups were the next problem to deal with after river flooding.
Lillian homeowners were angry. I spoke with utility officials, and they said it's a 500-year rain that had caused those flooded basements. These are crazy numbers they use. It makes you think this is going to happen every 500 years but it actually means something else. It's more of the percent type of thing. So we get this one kind of rain, and we get some attention there.
So we tell folks it's a 500-year rain, and two weeks later, the same thing happens. It rains hard and all these basements get flooded. Now, folks are really angry; it's July 1995, an election year, not a good time for cameras getting shots of crap floating in people's basements. We can't give them the same explanation again; we have to do something.
I go out again, and walk the Lillian Avenue area. It's probably the angriest group of people I ever walked with. They were upset and had every reason to be upset. The water receded but these basements still stunk and you could see the cause. Our attitude was to use this to advance what we knew needed to be done but had never been able to get over the edge with a strong commitment from politicians and the community.
Sewer task force
So we created the sewer task force. We got folks from affected neighborhoods, not only Lillian Avenue, but South Wayne and other not-so-obvious areas because one-third of the community is on combined sewers. We addressed the environmental and economic development components of this problem as well.
I basically said, "We'll give you all the staff and background. You tell me what you want done." The initial reaction was very suspicious. People believe it would be just another committee that would sweep the issue under the rug to get me through the election. But I indicated I'm serious; I said we need this problem addressed.
Folks worked on it close to a year. They came up with recommendations, not exactly what the utility officials would have come up with. But they were reasonable, calling for a higher level of service. I asked them how do you want to pay for it? And they said with a sewer rate close to 40 percent.
It still amazes me. I've told this to other mayors. In effect, I had this group of homeowners who were coming up to my office, shaking their finger at me, saying "Mayor you better raise these rates 40 percent or we're going to have your head. We'll protest in front of City Council and you better do this."
Usually, people approach an issue like this by being angry if you raise rates. This time, people were getting angry if we didn't.
You want something, pay for it
To me, it really gets back to my original point: If you want something, you have to pay for it. These folks knew there weren't any options out there short of getting the sewers fixed, and they were willing to take matters in their own hands. I surprised them by saying I accept your plan and will recommend it to the City Council. And we're doing this right around the time I'm considering running for U.S. Senate.
I didn't take much local political heat for it because citizens were pushing for it. This has to be done, they said. There would be no angry citizens as long as we did it. If anything, the issue was whether politicians had the guts to go along.
It really transformed the way the debate occurred. It was citizens setting priorities, in control and pushing them through. Government's role was to be the contractor. This group even wanted to stay around afterward to make sure the work was got done.
Part of the long-range sewer plan calls for periodic rate hikes as the work progresses throughout parts of the city. It will be interesting to see if the political will continues with the new mayor and council to see this through. My sense is they will go along.
Taxes too high?
Are taxes too high? How do you measure these things? We still have one of the lowest property tax rates in the state. The 1 percent income tax is a tool just about every other community has on the local level. And we are taking care of things other communities aren't; for example, we have an extensive curbside-recycling program.
The garbage fee was a way to address the issue, and the city made sure there was a fee for users instead of property taxes to pay for it. Costs for garbage pickup would be set by how much trash folks set out. And we still have a lower garbage rate than folks with private trash pickup have in the suburbs, and it's with curbside recycling.
My bottom line response to all this? Maybe some things have gone up, but they haven't gone up as much as the cost of inflation and other goods. We're low compared to other cities.
How we deal with things
But the crucial issue isn't just how low we are, but how we're dealing with issues. We have good bond ratings, we're taking care of out utilities, our public works and and our Police Department. What do you want out of government? If you want it, you have to pay for it, and now people are paying for it directly. When I left office, the amount of bonded indebtedness was less than when I had taken office, yet the city was larger populationwise 12 years later.
There are so many games you can play with finances folks just don't catch on to. There's the credit card scam, basically; you could put it on your credit card. Then you can trumpet "I didn't raise any rates and I'm fixing you're streets." But the bill is going to come in, sooner or later. We came in with old bills, took care of those and current needs, and left the city in a lot better shape than we started.
Most people aren't really that upset with what we've done with finances. They'd rather have the take-home police cars, neighborhood improvements and sewer issues dealt with.
Spin
Politically, it's tough. Again, if you want something, you have to pay for it. And if you don't, tell me what you'd like cut. I don't mind cutting back, but folks would rather pay for it than have a smaller police department, or less road improvements. That's the bottom line.
A lot of this is spin. A lot of it is headlines and puffery. When I make the point during speeches about how the property tax is lower than when I started, and I get the response, "It can't be true. My bill has gone up."
A lot of people don't know what they pay in taxes; it's other units of government that have contributed to the higher costs in many instances. How do you know if you're taxes have gone up without studying the issue? People have this instinct taxes are going up, but not knowing who's responsible. I ask people which taxes are going up the most; most people don't know. Most people, if they live in the city, believe most property taxes go to the city. And they don't, not even half.
A lot of this is educating people about taxes. But a lot of it is politics. When I ran for Senate, there were fliers on how I raised taxes 12 times. It would cover all those incremental increases without taking into account the decreases.
My gut sense is what we did with budgetary items was driven by what people wanted. If anything, I still think we do things on the cheap here. I believe we should be doing even more with services. We're a low tax community. But people want more services. And we provided it without smoke and mirrors.
The Steve Goldsmith game
Another game is the comparison people make: "Steve Goldsmith hasn't raised taxes. Why have you?"
Steve Goldsmith's tax rate when he was mayor of Indianapolis was a lot higher than my tax rate. It's the old game: Why is it that just because he inherited a higher tax rate than I and didn't cut it that he becomes Mr. Frugal. But I'm Mr. Tax Guy even though I have a lower tax rate than he.
It's like when you talk about tax freezes: It assumes you are at the right level to start with. For some people, it might be too high; for others, too low. If anything here, we've been on the low side.
And there's one other game: Who do you give credit to? The one who's at the right weight and stays there, or the one who's 50 pounds overweight and loses 30 pounds? One guy didn't lose a single pound, the other guy lost 30, so who's in better shape?
The whole thing's silly.
Cast of characters:
David Silletto -- Former Lincoln National Corp. executive who served as Helmke's controller, responsible for city finances
David Long -- Now a state senator, he represented the 4th District on the City Council during Helmke's first two terms as mayor
James Stier and Tom Henry Two long-time City Council Democrats; Henry still represents the 3rd District; Stier, who died in 1999, represented the 6th District for 18 years
Charlie Belch -- Long-time local Democratic party official who lost to Helmke for mayor in 1991
Steve Goldsmith -- Former Republican Indianapolis mayor; lost to Frank O'Bannon for Indiana governor in 1996
