County Economics – Income

The 2016 county income survey indicated that 53% of residents fall within the low to moderate income category.  This makes the county eligible for federal planning grants.

The data also identifies that 52.7 of students qualify for free or reduced-price lunches.

A summary of 2016 Indiana Tax Returns identified that 51% of individuals filing tax returns in the county report income of $30,000 or below.

Since 1999, there has been a downward trend in the number of residents reporting income under $50,000 and an upward trend in the number of residents reporting income over $50,000.  Overall, a downward trend in the number of residents filing returns.

State Tax Returns —  Income Trends by Category 1999 – 2016

State Tax Returns —  Income Trends by Category 1999-2018

 

School enrollment and closures

School funding is driven by school enrollment. Projections for Brown County Schools indicate continued declines in enrollment.

The Brown County Schools in their 2017/18 budget recommendations identified three scenarios regarding enrollments that would have an impact on school financing and infrastructure (page 6-7).  Their recommendations also identified the need for an economic and residential development policy.

A potential impact of declining enrollments is the need to close schools. Carmel schools are currently discussing the impacts of declining enrollments in their school system.  Why Carmel will consider closing schools

PROPOSED:   Support for Brown County Schools.  Development of an economic and residential housing policy that will help slow or reverse the downward trend in school enrollments.  Without an effective strategy, Brown County Schools may need to continue to cut the budget and rely on additional tax revenue from referendums.

Commissioners Candidates – Response to Questions

The responses by the candidates for Brown County Commissioner – District 2 to the questionnaire provided by the League of Women Voters. Responses were included in a Voters Guide published by the Brown County Democrat. Copies available at the Democrat.

See also: 2018 Voter Guide – Commissioner Candidates.  Includes commentary on the incumbent’s response to the question on planning.

'If you fail to plan, you are planning to fail!' - Benjamin Franklin

 

Inconvenient Truths about Maple Leaf

The Maple Leaf Music Venue and Performing Arts Center is to be a Brown County, IN government-owned and managed venue.  It is a 12.5 million dollar facility. The money is borrowed by the county.  Any profits plus revenue from the Brown County Innkeepers Tax is used as collateral.  Taxpayers are paying for costs that have included an initial  $30K legal bill.

Fast-Track Process

April 9. 2017. Commissioner Diana Biddle and Councilman Keith Baker attend a presentation conducted by innkeeper and CVC Member Barry Herring that introduces a concept for the Maple Leaf Performing Arts Center.

June 20, 2017. A group led by local innkeepers propose a government-owned and managed performing arts center (music venue).

August 22, 2017. Request for Zoning Change, Area Plan Commission, Recommend approval by the Commissioners.

September 6, 2017.  9:00 am Commissioner Meeting. Zoning approved. It was stated that the approval was for zoning and not the project and that public meetings would be held regarding the desirability of the project.

The only official public meetings that our commissioners and council held on this $12.5 million county owned and managed music venue were  to approve the project. 

November 15, 2017. Commissioners approve the project.

November 20, 2017. Council approves project.

Dec 20, 2017. Commissioners pass a final resolution approving the project.

SUMMARY –  Extracted from the following article: Dec 27, 2017. GUEST OPINION: The role of process in the future of Brown County. The Maple Leaf Performing Arts Center (MLPAC) project and the process used to fast-track approval may represent a turning point for the future of the county.  

  • In April 2017, owners of hotels and inns, who are also appointed to the Convention and Visitors Commission (CVC) and Convention and Visitors Bureau (CVB) decide to use the revenue collected from the innkeeper’s tax to invest in an asset that will promote tourism. The Innkeeper’s Tax is a pass-through tax paid by the party renting the overnight accommodations.
  • CVC members are appointed by the county commissioners and council. The CVB is a non-profit organization established to manage tourism related promotion on behalf of the CVC.
  • CVC/CVB members decided on a music venue and performing arts center and also determined the size, location, scope, cost (12.5 million), and overall governance plan for the facility. Given that this investment is expected to result in overnight stays, their businesses will directly benefit from the investment, and the asset values of their establishments will likely increase.
  • Initially, county citizens were told that revenue from the innkeeper’s tax would be used to pay the principal and interest on the mortgage for the venue. Any profits were to be used for community and county infrastructure priorities.  The final terms of the deal are that profits would be used to make the mortgage payment and the revenue from the innkeeper’s tax would only be used if profits were not sufficient to make the payment.
  • A common perception in the county that was reinforced by the president of the county council, may be that the revenue from the innkeeper’s tax is “their (CVC) money.” This inaccurate perception may have contributed to a lack of transparency over the years regarding the management and expenditure of these funds.  This revenue, per statute, is a county asset. Commissioners and Council (elected by citizens) appoint CVC members who are subordinate to the citizens and their elected officials.
  • The approval of a 12.5 million dollar loan using the revenue from the innkeeper’s tax as collateral was approved by the commissioners on Nov 15 and the county council on Nov 20. The commissioners approved another resolution approving the project on Dec 20. In case of default, the venue would become the property of the bank, and per the county council president and the county financial consultant, county taxpayers would not be obligated to assume the liability.
  • No public meetings expressly focused on this important project were scheduled by the commissioners or council before their meetings to approve the project. The League of Women Voters of Brown County offered to facilitate a public meeting to address citizen questions, concerns, and issues regarding the project. Members of the CVC, the CVB and the informal team working on the Maple Leaf project declined to participate, as did several key elected officials.
  • The editor of the only newspaper in the county – The Brown County Democrat, did recuse herself from being the primary reporter because of a conflict of interest — her husband serves on the CVC. The Democrat welcomed opposing opinions in Guest Columns and Letters to the Editor.

More information and references: Maple Leaf Project – For The Record

2018 Voter Guide – Commissioner Candidates

The 2018 Voter Guide published Wed, April 4, 2018, by the Brown County Democrat includes responses to questions that were sent to the candidates by the League of Women Voters.  Question 3 was on the topic of planning.

Candidates for county offices include County Clerk, Commissioner – District 2 and Circuit Court Judge. A candidate forum is scheduled for Wed April 11, 6:30 County Office Building.  All three Republican primary candidates are expected to be present.  These include Diana Biddle (incumbent), John Kennard, and Ronald A. Sanders.  Since one of the Democrat candidates for commissioner cannot attend – Jeff Fox, the League of Women Voters rules limit the other candidate – Kyle Birkemeier, to introductory remarks only.

Planning is how you identify specifically what citizens want and do not want in terms of change.  Transparency (honest and open communication) requires published plans that are developed with the input from the citizenry. (Examples of county plans below).

For the sake of disclosure, I was on the Redevelopment Commission (RDC) in 2016 and 2017 and was not reappointed in 2018.  Commissioners as well as the council did not and do not have to provide a reason for non-reappointments.  More info: 2018 RDC Appointment Process 

The election for Commissioner – District 2 represents a clear choice for the county.  Should citizens have a voice in the direction of the county or is the status quo good enough?   I included responses from Commissioner Biddle who is the current incumbent.  All the questions and responses from all the candidates are provided at the bottom of this post.

Question: “Do you support the development  of a County Comprehensive Plan and Economic Development Strategic Plan that provide community-supported guidance for all aspects of development and infrastructure and why and why not?”

Commissioners Biddle’s response:  “The current comprehensive plan was completed in 2012. Further development of the plan should include adding additional tools, such as area infrastructure maps, to our existing comprehensive plan . The missing piece for us an up-to-date zoning code to complete the 2012 comprehensive plan. This update is currently underway.” 

Note:  The county application for an economic development strategic planning grant was approved by the commissioners in December 2017 but is on hold pending the decision on the Van Buren Fire Station Issue.

The Brown County Schools in their the 2017 -18 Budget Recommendations identified that an effective economic development and housing policy had a direct impact on school enrollments, If enrollments continue to decline, it will likely lead to the need to close schools.  Note that there is no mention of schools in Commissioner Biddle’s responses.  Expansion of broadband internet is just one component needed in an economic development strategy.

Elsewhere in the voter guide, Commissioner Biddle identified what she considers three challenges: Courthouse Security, County Roads and Bridges, Broadband and other Infrastructure.

  • “County Roads and Bridges.”  See references below to standard practices in other cities and counties.
  • Broadband and other Infrastructure“.  A state law was created in “2013” that allowed the commissioners to show that adequate broadband services are unavailable in Brown County. The law allowed them to declare the entire county an infrastructure development zone. No action was taken in response to the law by the commissioners until 2018.  Ref: Brown County Democrat, Feb 20, 2018. Public comments wanted at hearing about internet options

The county Redevelopment Commission (RDC) in 2016 and early 2017 abandoned the goal to pursue updates to the GIS infrastructure maps due to lack of support from Commissioner Biddle.

The county GIS map can be updated at any time to identify existing and planned expansion of broadband.  Economic development plans in areas that are currently supported by broadband can also be developed.

Commissioner Biddle in her advocacy for the Maple Leaf Performing Arts Center reinforced her disdain for planning in her remark: “We have planned ourselves to death …”   There is no evidence of any significant planning efforts supported by Commissioner Biddle. Ref: Guest Column: Maple Leaf proposal: Let’s not fail to plan. See also Chronology of Events – Maple Leaf.

Examples of County Comprehensive Plan and Road Maintenance Plans. 

A “plan” is a written account of the intended future course of action aimed at achieving the specific goal (s) or objective (s) within a specific timeframe. It explains in detail what needs to be done, when, how, and by whom.

Questions for Candidates:

Tourism Benefits – Facts and Perceptions?

I received a handout from the CVB yesterday about the Maple Leaf project. It includes estimates and projections on revenues generated from tourism.  I have asked for additional information. Note that the county is funded primarily by income and property tax.

2013 – Tourism Estimates Rockport Analytics (images not clear)

  • Jobs supported by tourist spending: 642
  • Wages generated by tourism: $11.3 million
  • Tax revenue generated by tourists: $7.5 million
  • Additional amount residents would have to pay per year in taxes if tourism didn’t exist $771.

IF people “perceive” that these numbers represent the revenue generated for the county, then the numbers are very misleading. They appear to be a combination of county information (jobs/wages) and State info (tax revenue and additional taxes that might be needed).

For example, if you divide wages ($11.3 million) by jobs (642), the average wage is $17,601. This does not generate $7.5 million in tax  revenue for the “county.”   The income for the owners of the tourism-related businesses is likely higher in order to compensate them for their investment and risk.

The projections and estimates likely include the ”possible” total tax revenues received by the State from ALL tourism-related taxes – direct and indirect.  See below for more information on methodology, metrics, evaluation.

The So What?  You need good information to support effective decision-making.  In the case of Maple Leaf, there were many options that could have been considered to help determine the best return on investment for the revenue from the innkeeper’s tax. Citizens were not given the option to learn more about the other possibilities.

The decisions as to the type, scope, location, and cost were made by the innkeepers. This represented a  conflict of interest.  The innkeeper’s benefit from increased revenue from hotel stays and likely increases in assessed value for their properties.  An independent assessment of the feasibility of Maple Leaf was not required by the commissioners or county council before they approved this project.

My articles and posts on the topic:

One of the objectives in applying for an economic development strategic planning grant is to develop an economic baseline that we can use to accurately track the number and types of businesses, number of jobs and average wages.  This information is important in estimating and projecting revenues and expenses which in turn, allows you to anticipate any need for cutting the cost of government and/or raising taxes.  Without this information, decisions are reactionary and major decisions may be made behind closed doors.

More Info: 

Financial Management – Maple Leaf

Extract below on funding issues from the article published March 27, 2018, in the Brown County Democrat: “Commissioners taking project offers: Bids expected by April 18 for Maple Leaf Performing Arts Center building”

Auditor Beth Mulry asked how bills were being paid.

“I am hearing talks of things being paid for. I know the auditor’s office, the only thing we paid for was one interest payment that I think was then refunded,” she said. “At what point does the county’s auditor’s office become involved?”

Biddle said, “very soon.”

“We have no written direction; there is no fund set up; we have no money; I have no idea how things are being done, I guess, at this point on the finance. We need ample time to receive that information from you guys,” Mulry said.

Biddle said a meeting will be scheduled with County Attorney Jake German, who was not at the March 7 or March 21 commissioners meetings, to discuss the flow of financing and roles in the project.

“The tourism commission, the different moving parts of this project, we need to all sit down and make sure we all know what we’re doing, what our piece of the project,” she said.

Mulry said she wants to make sure the project is in compliance with the Indiana State Board of Accounts.

“From my perspective, I know the building corporation has borrowed $12 million. The county auditor’s office still doesn’t have any formalized copies of that stuff. I don’t know who has the authority to spend that money. … I don’t understand what’s going on,” she said.

Letter to the Editor – Proposed Septic Ordinance

I encourage your attendance at the March 29, 6:00 pm commissioner meeting to discuss the proposed septic ordinance.   My concerns expressed in a Letter to the Editor of the Brown County Democrat – to be published on March 28, 2018.

Mar 30, 2018.  Brown Co. Officials Still Considering Changes To Septic Ordinance  By INDIANA PUBLIC MEDIA NEWS STAFF Posted March 30, 2018.  A plan to update Brown County’s septic ordinance is going back to the board of health for more work.

Mar 28, 2018.  Letter to the Editor:  Limit the scope of the proposed septic ordinance.  I participated in the public meetings last year on the proposed septic ordinance. Despite the concerns and recommendations identified at the meetings provided by a diversity of stakeholders, there have been no significant changes to narrow the scope of the proposed ordinance.

The meetings did inspire me to develop an outline of a better process for developing new policies.  See “Example County Decision-Making Process” at the website – Independent Voters of Brown County IN (all one word).   This process includes definitions to clarify the difference between a fact and a non-fact.  The Health Board does not have the facts to back up their suspicions that there may be a large number of failed systems in the county.

State requirements should not be exceeded without a compelling need.  My opposition to the proposed ordinance includes the following concerns:

  • No documented and scientifically validated analysis that justifies exceeding state standards has been provided.  Sections of the ordinance that exceed what is required by the state include county certification of installers and county inspection standards.  The fines and penalties can also be problematic.
  • The costs and benefits of shifting the responsibility of individuals (buyers and sellers) and the private sector (realtors, inspectors, banks) onto the government and its taxpayers have not been justified or quantified. Nor is this shift considered a core function of government.
  • The life of a septic system has been estimated at 25-30 years.  The technology, maintenance history, water usage, and soil types all affect the performance of a system. If the 25-30-year estimate is accurate, how many existing systems may have outlived their useful life?  How and when will the new ordinance be enforced to identify these potential failed systems?
  • What will be the economic impacts and hardships resulting from failed systems on the 53% of our population that are in the low to moderate income range – many on fixed incomes, that may not be able to afford the cost associated with septic system repairs and replacements?
  • If it is proven that there is a high number of failed systems, this will present the opportunity for the county to negotiate for volume discounts for repairs and replacements. It could also demonstrate a need for sewers. Application for financial aid related grants may also be possible.
  •  The standard operating procedures (SOPs) that will be used to administer and enforce this proposed ordinance have not been published and made available to the public. SOPs provide the supporting detail that identifies the steps that will be followed in enforcing the ordinance. These steps would include those involved with condemning properties, disapproving home remodeling projects, assessing fines, resolving complaints filed against the health department, processing appeals, filing lawsuits against citizens, et.al.
  • Without SOPs, the proposed ordinance if passed as-is, can lead to corruption and abuse if it is leveraged for selective testing and enforcement. Consequently, an enforcement plan would be needed to ensure citizens that the ordinance is being enforced fairly and equitably.

In summary, update the ordinance as needed to comply with existing state code only.  Form a project team or contract with a consultant to study and address the larger and more complex issues.

Tim Clark
Brown County

More Information:  Background – Proposed New Septic Ordinance — copies of the ordinance, state code, articles in the Democrat.

Effective Leadership – 4 key behaviors

Four kinds of behavior account for 89 percent of leadership effectiveness

  • Solving problems effectively. The process that precedes decision making is problem solvingwhen information is gathered, analyzed, and considered. This is deceptively difficult to get right, yet it is a key input into decision making for major issues as well as daily ones (such as how to handle a team dispute).

  • Operating with a strong results orientation. Leadership is about not only developing and communicating a vision and setting objectives but also following through to achieve results. Leaders with a strong results orientation tend to emphasize the importance of efficiency and productivity and to prioritize the highest-value work.

  • Seeking different perspectives. This trait is conspicuous in managers who monitor trends affecting organizations, grasp changes in the environment, encourage employees to contribute ideas that could improve performance, accurately differentiate between important and unimportant issues, and give the appropriate weight to stakeholder concerns. Leaders who do well on this dimension typically base their decisions on sound analysis and avoid the many biases to which decisions are prone.

  • Supporting others. Leaders who are supportive understand and sense how other people feel. By showing authenticity and a sincere interest in those around them, they build trust and inspire and help colleagues to overcome challenges. They intervene in group work to promote organizational efficiency, allaying unwarranted fears about external threats and preventing the energy of employees from dissipating into internal conflict.

Reference:  Decoding leadership: What really matters, By Claudio Feser, Fernanda Mayol, and Ramesh Srinivasan, McKinsey Quarterly 2015

Living Wage in Brown County?

The economic disparity in the U.S leads to discussions on the pros and cons of the minimum wage as well as on a “living wage.”

The Massachusets Institute of Technology (MIT) developed a living wage calculator that estimated that the living wage in Brown County ranges from $11.00 to $27.00 per hour depending on the size of the family.  The minimum wage in Indiana is $7.25.

In 2016,  the government’s official poverty line was $24,339 for a family of four, including two children.

In my Guest Column article in the Democrat – A study of tourism and economic sustainability,  I included data from the Bureau of Labor Statistics that identified that the hospitality and tourism industry has the lowest average wage in our region at $24, 477.

On the Maple Leaf  Performing Arts Center,  the local innkeepers reinforced that it would be financed with taxes collected from tourists via the innkeeper’s tax.  The business owners (hotels, restaurants, novelties, et al.) that cater to tourists are expected to be generating more revenue as a result of the increases in the number of tourists expected to attend the events.  Will employees also be benefitting from Maple Leaf by receiving higher wages? Can the cost of wage increases also be passed on to the tourists?

Decisions made by those we elect to represent us should produce results where everyone gains, or at least, are not any worse off in the long-term.