I was sent a link this morning to the Report of the Fiscal Monitor for Gary, Indiana. This suburb of Chicago located along Lake Michigan has, “…a proud history, tremendous physical assets and human resources. Today, however, the City’s future is at risk.”
If you read the report, that last sentence is an understatement. Here are some of the lowlights:
- Majestic Star Casino (projected to bring in lots of revenue to Gary) first had a dispute with the city and now has entered bankruptcy.
- Revenues are projected to fall from $79.0 Million in FY2010 to $62.6 Million in FY2014 while expenditures are projected to increase from $76.5 Million to $84.5 Million during the same time-frame.
- Property Tax Revenues will fall 50% over time.
- $34.3 Million in judgments and other legal obligations currently outstanding with another $1.1 Million under appeal.
The key for Gary is personnel costs. These are going to have to come down. Cities can’t print money; if the revenue coming in is $50 million that’s what must go out. The unions in Gary and other locations are going to have to get used to less, less, less rather than more, more, more. Otherwise, they’ll be learning all about Chapter 9.
