By Chas Reilly, Times of Northwest Indiana
chas.reilly@nwi.com
MERRILLVILLE | A State Board of Accounts examination of the town's financial records indicates the municipality in 2008 spent about $3.5 million more than it appropriated in its general fund and multiple town funds were overdrawn.
The report, which was released last week, shows about $2.9 million of the $3.5 million Merrillville overspent in 2008 was used to pay for invoices from 2007.
It also indicates Merrillville had five funds with overdrawn cash balances in 2008.
The Police Officers' Pension fund was overdrawn $243,997, which was the highest amount among the overdrawn funds. The Motor Vehicle Highway fund was second on the list, overdrawn $156,745.
"Routinely overdrawn funds could be an indicator of serious financial problems, which should be investigated by the government unit," the document states.
Town Councilman Richard Hardaway, chairman of the Budget and Finance Committee, said he had not seen the report and didn't have an immediate comment. Town Council President Joseph Shudick could not be reached for comment.
The financial review states Merrillville made two temporary transfers in 2005, but the temporary loans had not been repaid by the end of 2008. Merrillville transferred $165,000 from the Cumulative Capital Development fund to the Cumulative Capital Improvement fund and $260,000 from the 93rd Avenue Redevelopment fund to the Redevelopment Bond Debt Service fund, the report states.
Municipalities are required to pay back loans by the end of the year in which the loans were received, Merrillville Clerk-Treasurer Eugene Guernsey said.
He said the town unintentionally overlooked the two temporary loans, which is why they weren't repaid.
"I take the heat for that one," Guernsey said.
Charlie Pride, of the State Board of Accounts, said none of the issues found in the report stands out more than another, and town officials "really need to address all of the items before we come back next year."