The Portage City Council approved a police union contract Monday night that amounts to de facto future approval of tax increment financing for residential subdivisions to pay for it.
The contract requires an additional $650,000 or so, said Councilman Collin Czilli, D-5th. “There’s an additional cost beyond just salaries,” he noted. Benefits and other issues need to be tallied as well.
Negotiating the police contract “was an amazingly eye-opening experience,” Mayor Austin Bonta said.
The council also approved $1.35 per hour raises for the utilities department workers. General Superintendent Tracie Marshall said 10 cents of that raise will go into a health savings fund administered by the union.
Among the many changes in the contract’s language is to make bereavement benefits match up with other departments. If you have a sibling in another department, you should have the same length of time off for bereavement for the same deceased relative, Bonta said.
“Certifications was a big thing we looked at this year,” Marshall said. “We would like the most educated and professional staff we can in the area.”
The contract was approved by about 95% of the union members, Bonta said.
The utilities department raises are fully funded through the utility rate increases approved last year to pay off $30 million in bonds for treatment plant updates and other needed sewer infrastructure improvements, he said.
Police salaries, however, come from the general fund, which was strained even before the city negotiated 6% raises for the officers. At the start of the year, the city only had a few hundred thousand dollars in unappropriated funds and no rainy day fund to rely on.
Police Chief Michael Candiano said the city’s police are underpaid when compared to Porter County, Valparaiso, Chesterton and Porter officers. In Lake County, salaries are even higher.
“Police work right now is competitive. A lot of people are jumping from department to department looking at wages and benefits,” Candiano said. “If we can steal a quality officer, I’m all for it.”
One plus for Portage is the department now allows new hires from other departments to keep the same vacation benefits they’ve built up elsewhere.
Portage Police Chief Mike Candiano, shown Friday, May 19, 2023, said at Monday's council meeting that the market for police hires is competitive and Portage is at risk of losing officers to higher-paying departments. (Kyle Telechan for the Post-Tribune)
“If you’ve got the benefits and you’ve got the pay, you’re going to have a better shot of getting the higher quality officer,” Candiano said.
But Portage doesn’t have the same pay officers elsewhere are accustomed to. “The less we offer, there’s always somebody else that’s hiring,” he said.
“Everybody’s hiring now,” so competing with state police, “who have an astronomical salary bump,” is difficult, Candiano said.
“If you drop low on pay, $6,000, $7,000 $8,000, that’s a lot, especially to a younger officer,” he said.
It’s not just about being able to hire officers. It’s also about retaining them.
Losing an officer to another department means losing the hours that went into training, along with knowledge of the city and its residents. Plus a new officer means providing uniforms and equipment. There’s “a huge, huge cost to us if we lose somebody to another department,” Candiano said.
“I wouldn’t be doing my job if I didn’t explain how important it was for us to be competitive,” he said.
“The number that our police deserve is much higher,” Bonta said, but the city can give only what it can afford.
There’s the rub. The city can’t afford the raises based on the current budget, Czilli pointed out.
Bonta assured the council he has a plan to afford the raises, both through spending cuts and generating additional revenue, notably through the council approving tax increment financing districts to stimulate residential growth. The income from those new homes would help pay police salaries until the TIFs expire, buying the city time to find another solution.
“I’m very confident we can do it,” Bonta said.
Czilli and Councilwoman Gine Giese-Hurst, D-1st, were more skeptical. Giese-Hurst asked if the council’s budget committee had discussed the issue. Council President Victoria Vasquez, R-3rd, who heads the budget committee, said the budget committee didn’t have time to do so because of the short notice for the council meeting.
The council knew the contract was coming and the budget committee should have known the likely amount needed for a while, Czilli said.
This isn’t the first time the council has approved a contract without knowing how to pay for it, Bonta said.
But Czilli, the longest-serving member of the council, said the city’s financial situation hasn’t been this dire before.
“I don’t have suggestions on how to get the funding. I have a plan,” Bonta said. “If you are OK with this contract, it will mean being OK with the residential TIF.”
By August to October, the city will have proposals for residential TIFs coming in, he predicted.
“To put it very simply, I wouldn’t be here in a public meeting fighting for the contract if I didn’t believe in it,” Bonta said. “At the end of the day, the residential TIF is an indirect public safety tax.”
Bonta and a couple of the council members expressed concerns about rapid residential growth when campaigning for office in 2023.
Adding to the squeeze on Portage’s finances will be the effects of Senate Enrolled Act 1, approved by the Indiana General Assembly this year. That law will put the squeeze on municipalities’ property taxes, reducing anticipated revenue growth in future years.
The law allows cities to enact a public safety income tax beginning in 2028, when the full weight of the property tax squeeze hits, Czilli noted, but that doesn’t help Portage in the meantime.
“It’s not a budget issue. It’s a cash issue,” he said. “If you don’t have cash, you can’t loan yourself from other funds.”
Doug Ross is a freelance reporter for the Post-Tribune.
