Rollo, Kruzan to Introduce TIF Spending Restriction Ordinance

FOR IMMEDIATE RELEASE

April 21, 2015

For more information, please contact:

Alexa Lopez, Communications Director, City of Bloomington Office of the Mayor, 812.349.2489

Rollo, Kruzan to Introduce TIF Spending Restriction Ordinance

Bloomington, Ind. - City Council President Dave Rollo and Mayor Mark Kruzan proposed a city ordinance today to restrict the manner in which Tax Increment Financing (TIF) funds are appropriated.

The proposed restrictions reflect policies that Kruzan instituted administratively last year in the City Financial Policies Manual. Those policies were put in place to further deter theft in view of recent events concerning City employees.

"The City Council made it clear it wanted aggressive action taken at the time," Kruzan said. "Given that the Financial Policies Manual's shelf life extends only to the end of any given city administration, Council President Rollo and I would prefer to put some of its key provisions into law."

"We fully vetted and supported the fiscal control measures that are now in place starting one year ago this week," Rollo said. "Now, we want to take them a step further so that they are permanently memorialized in city code."

The Financial Policies Manual came into form in April 2014, though many of its provisions were already City policy. The manual instituted tighter financial controls, centralized fiscal oversight within the Office of the Controller, segregated financial duties between different departments and employees, created an approved vendor list, eliminated individual employee credit card use and barred open-ended appropriations.

"Many people believe the Wykoff case involved significant amounts of general taxpayer dollars," Kruzan said. "In fact, the bulk of the theft was focused on an isolated pool of money that is not reviewed by City Council and not money that is available for the general operating expenses of city government such as staffing, salaries or programming."

Rollo and Kruzan said TIF funding, given its unique characteristics, needs unique controls. "While we acted quickly to restrict TIF dollars administratively, we now seek to institute those controls in law, as they apply to the Redevelopment Commission," Rollo said.

The Rollo-Kruzan ordinance would:

• prohibit the Redevelopment Commission (RDC) from approving blanket or open funding resolutions;
• prohibit any funding resolution that is not connected to a specific contract or agreement with an approved and specific vendor;
• require that all funding approvals also specify a definite date by which funding shall be terminated; and
• require that any time extensions related to funding be explicitly authorized by separate resolution of the RDC and only after full explanation and justification for the extension is provided by appropriate staff.

"Since the inception of TIF Districts decades ago, appropriations were pre-approved, and projects were funded on a rolling basis," Kruzan said. "That long-standing practice caught up with city government in the form of an employee who exploited that loophole. It's already been closed, but we want City Council to enshrine that solution in law."

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