More than $1.64 million was in Grant County's 13 township reserves at the end of 2007, as Hoosier lawmakers are questioning whether to eliminate township government.
According to the Indiana Office of Management and Budget, some townships in the county had more in their cash reserves at the end of the year than the amount they spent on items such as public safety and poor relief.
Liberty Township, for example, spent $33,171, but had $92,656 on hand - nearly three times the amount spent.
While 2008 numbers are not yet available, the trend is the same across the state for 2007. All Indiana townships had more than $200 million in reserve or cash balance."There's no set recommendation on how much should be in cash reserve," said Mary Jane Michalak, spokesperson for the Indiana Department of Local Government Finance.
Surplus explained
The reason behind the surpluses seems to be steeped in Indiana code and the way township government is run.
A township board approves a budget and sends it to the county council for nonbinding approval. Then the budget is sent to the Department of Local Government Finance for approval.
Townships could use their surplus instead of collecting the maximum levy in property taxes, Michalak said, but they may not be able to collect their full amount in future years.
For example, if a maximum levy is $150, but the township chooses to collect $100, the following year they would be able to collect up to only $125, according to state code.
In Mill Township, nearly $390,000 was in cash reserve in 2007 while the township spent $226,949.
"There's no guidelines really (on how much should be in reserve)," said Caroline Armes, Mill Township Trustee. "I think that's just been built up over a number of years."
Armes said she has followed in the footsteps of previous trustees in budgeting and is looking into putting the funds into a savings account so it can earn interest.
"We do have some excess and I realize that, but when you're working with the fire department, to me that money is going to come in handy when you're going to buy a fire truck," Armes said.
Center Township Trustee Bryce Coryea also is hoping to buy a new fire truck to replace a truck more than 20 years old.
"They call it a surplus," Coryea said. "It's really what your office is going to work on for the next six months."
Center Township had more than $174,700 in a cash balance in 2007, while the township spent over $459,600. That makes the cash balance 38 percent of the dollars spent.
Coryea said he is striving to be frugal with tax dollars, yet in today's economy it's good to have some cash on hand for unpredictable poor relief.
Grant County Auditor Mike Burton and Grant County Council President Jim McWhirt both said the county has little say over what happens in townships, save for a nonbinding look over budgets.
"You always need to have some cash balance, but you can have too much," Burton said, adding that Grant County strives to have a 16 percent cash balance for its general fund, but often doesn't make it.
McWhirt said a general rule for a reasonable cash balance is around 12 percent. Much of the issue with township reserves probably stems from state statute that encourages townships to raise the maximum levy, he said.
If the maximum is not raised, townships wouldn't be able to collect the maximum amount in future years, which McWhirt said is sort of like being penalized for being frugal.
Township elimination reaction
Senate Bill 512 would eliminate township trustees and the township board, and transfer all duties to the county level.
The bill was discussed Wednesday in a statehouse committee. Dozens of township officials - including Coryea - showed up to voice their opposition.
Coryea is concerned about the poor being able to get to Marion for help if townships are eliminated and duties run out of the county offices. If they are having problems paying their bills, he said, they may not be able to make it to downtown Marion for assistance.
Armes also is concerned about those who don't drive or have physical or mental disabilities.
"I'd hate to see those people with nowhere else to go," she said. "I'd hate to see those people get lost in the shuffle."
For David Pickett, Washington Township Trustee, this year's initiative is one of several that has happened in the last 30 years he has been a trustee, all aimed at ending township government.
"I've never seen any time where they've taken it away from the grassroots where it will be beneficial," he said, adding that while state lawmakers have talked about it for years, this time it seems close to becoming reality.
Pickett also is concerned about the overall cost of the county taking over township duties.
"It's absolutely going to cost more because they're going to hire several people to replace us, and they're going to be full-time people," he said.
Sen. Travis Holdman, R-Markle, said the more than $200 million in township reserves across the state is excessive.
"I think there ought to be a limit on the amount of the operating balance," he said.
Holdman sits on the committee discussing the bill to eliminate townships. He said, right now, he wouldn't vote for it but there may be amendments to make him change his mind. He hopes each community can decide for themselves.
"I'm a firm believer we need to allow for a referendum whenever we can," he said. "I certainly don't believe that one size fits all and that we need to be using a cookie-cutter approach to what we do in the state of Indiana."
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