When the city of Terre Haute fell behind on bills owed to a northside hardware chain, Controller Leslie Ellis went there personally and took several checks to pay up.
“I heard from some of the departments that Menard’s was needing payment, so I gathered everything I had and went up there and paid it so it would be posted that day,” Ellis said on Friday in an interview with The Tribune-Star. She didn’t want to mail payment, she said, because that might delay it a few days.
She said she’s also talked to other vendors by phone related to delayed payment of bills because of the city’s revenue crunch, which the Mayor Duke Bennett administration has called a cash-flow issue as it awaits tax disbursement from the state. “They’ve all been very understanding,” she said of vendors. Sometimes, she said, she will stop at a vendor to make payments “just to speed up the process.”
As of Friday, the city owed $730,281 in bills that were more than 60 days overdue, according to information compiled by the city controller. Ellis says she monitors cash flow each day to determine which checks can be released for payment.
Some utilities, including Duke and Vectren, have sent disconnect notices to the city in recent months, records show. The city attributes some of those disconnect notices to mistakes. In the case of Vectren, a bill was misplaced, and for Duke Energy, checks for the right amount were sent — one was for $15,000 — but remittance forms were not correct, and so the checks were returned to the city. The matter was cleared up and those bills have been paid, Ellis said.
As of Friday, city utility bills were up to date, Ellis said.
In making decisions about which bills have priority for payment, utilities are first, followed by charge accounts, Ellis said.
One large bill, according to city records, was for $196,371, owed to American Structurepoint for work on the Margaret Avenue project. Another $91,908 was owed to Renewable Transport Services, which hauls sludge. The city entered a contract with Renewable Transport Services last July.
According to a November Tribune-Star article, Renewable Transport Services Inc. is a trucking company whose principal, according to state records, was Noah Sodrel, registered agent for Sodrel Fuels.
A November article said Renewable Transport Services “brings sludge from remote cities and locations to Terre Haute for storage in large tanks.”
Other vendors with bills 60 days or more past due include URS Corp. for $69,700; ONB Benefits Administrations LLC for $44,230; and Hannum Wagle & Cline for $37,668, according to city records.
On April 15, the Tribune-Star submitted a public records request to the city that asked for a copy of bills, or invoices to the city, that were 60 days past due or longer as of April 15.
The request also sought correspondence, including email, related to bills, or invoices 60 days past due or longer, as of April 15. The request sought a copy of correspondence, including email, of any change-of-credit status from specific creditors.
“This request concerns a statement from a Board of Works member who stated the city has a dire financial position,” the request stated. The Tribune-Star, working with the city attorney’s office, agreed to an arrangement whereby Ellis could generate a report supplying overall information, with the Tribune-Star having the opportunity to inspect claims as well as correspondence regarding any line-of-credit cancellations.
The Tribune-Star checked on the status of the request Wednesday, with an appointment set up for Friday morning.
Friday morning, Ellis was still working on completing a report compiling information on bills more than 60 days past due, and staff who could facilitate the process of claims inspection could not be in until noon because of family matters. On Friday afternoon, Ellis completed the list of bills more than 60 days past due.
Information was not organized in a way that was readily available for inspection, but Ellis offered to provide specific invoices requested.
Describing the city’s financial difficulties, Ellis pointed to property tax caps, which are costing the city almost $10 million per year in revenue. A few years ago, the city’s assessed valuation declined, which also had an adverse impact on revenues. It created “a perfect storm ... to where our revenue is just being squeezed,” she said.
Also, for the first 51/2 months of the year, the city receives only about 15 percent of its revenue. Its largest distribution of revenue involves property taxes; the first settlement doesn’t come until the end of June and the second at the end of December.
“We hope to get a property tax advance this month, and all of our bills will be paid as soon as we get the revenue in,” Ellis said.
The issue of the city having money will change as of next week, said Vigo County Auditor Tim Seprodi.
The county auditor said the city regularly requests an early payment of its spring and fall tax disbursement. “While we have not yet received their request, we have been told it will be soon. As soon as tax collections so far are certified, we will issue payment,” Seprodi said Friday.
The payment is based on a certification of tax collections made after mid-November through this month. “The treasurer certifies how much tax collections have been received in that time. Whatever that amount is, the city then gets 50 to 60 percent of that total,” Seprodi said.
That amount is typically “$8 million to $9 million. The city then gets the rest of the spring tax disbursement by the end of June,” the county auditor said.
If the county auditor’s office receives the early payment request from the city on Monday, the county could make that payment within a week, the auditor said.