Gary Death Countdown

Monday, December 28th, 2009

The clock is ticking for the death of Gary, Indiana, says T.M. Lutas:

State law imposes property tax caps on all local governments far below the level Gary has grown accustomed to. Gary finances 80% of its $80M+ general fund operations through the use of property taxes. A vote on including the tax caps in Indiana’s Constitution is widely expected in 2010.
Complicating matters are at least $34M in outstanding debts on top of its impending structural deficit. The term at least is used advisedly because unlike most cities, and most private organizations of its size and complexity, Gary uses a cash based accounting system. Future obligations that have not been presented for payment are not accounted for at all in a cash based system. The city government literally doesn’t have the capacity to accurately know what it owes. Because of the lack of information the financial monitor is forced to guess at some basic information.

The current Gary financial monitor’s report makes for frightening reading. Property tax revenue is scheduled to drop 50%+. There is no likelihood of a local income tax and Indiana does not share its sales tax revenue with local government. One of two casinos operating in Gary has entered bankruptcy and even before then a dispute with the casino operators disrupted payments to Gary. The bad news keeps on rolling for 265 pages.

Dan from Madison says:

Every year I vacation in Michigan and drive by Gary on the way there. The downtown area always reminds me of what one of the old cities behind the Iron Curtain used to look like.

This anecdote paints a creepy picture:

A few years ago a friend of mine was working a contract for the state government which sent him all over the state. He spent at least a couple of days in Gary. The small group he was with went out to lunch. They tried finding an ATM machine and couldn’t. So they asked a cop, who laughed and said they didn’t have any ATM machines in Gary.

It really is the Detroit of Indiana:

I recall taking the bus to Chicago around 1990 and stopping in Gary (and Hammond). Panhandlers and hookers in the bus station. Streets with ripples like Lake Michigan frozen in mid-breeze. Inhabited houses with the white plugs for spray-in insulation and, occasionally, charred areas around the windows. As we pulled out, I got to see more inhabited homes with cars out front up on blocks, yards with trash, often large (e.g., a dead washing machine). It’s all sad, as I know people in their 40s from the Region who can say they knew when Gary used to be a nice place to live.

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