Electronic meetings statute stops vote on $5.8M bond issuance by Bloomington parks board

The final approval of $5.8-million in general obligation bonds appeared on Tuesday’s agenda for Bloomington’s board of park commissioners.

It did not get a vote, because only two of the four park commissioners were attending the meeting in person.

A special meeting will be scheduled so that a vote can be taken.

A third commissioner attended Tuesday’s meeting by using the Zoom video-conferencing platform—which allowed the board to achieve its quorum of three members to transact other items on its agenda.

Under Indiana’s Open Door Law (ODL), an attendee who participates by electronic communication counts towards satisfying a quorum.

And under ordinary circumstances a remote attendee’s votes count towards whatever majority is needed for a particular item to be approved.

But under the ODL, there are some circumstances that preclude a member’s participation in a meeting using electronic communication. Among them are meetings when the governing body is taking final action to “establish, raise, or renew a tax.”

Issuing general obligation bonds has the impact of raising property taxes.

So corporation counsel Beth Cate told the board on Tuesday they would need to put off taking a vote until their next regular board meeting or else schedule a special meeting.

At the end of Tuesday’s meeting, parks and recreation director Paula McDevitt told the board she would be in touch to schedule a special meeting for the bond issuance vote.

The parks general bonds are part of Bloomington mayor Hamilton’s new revenue package, which he has asked the city council to approve.

The item was not controversial for the park commissioners. The board itself had kicked off the process for issuing the general obligation bonds at the end of March.

It’s the board of parks commissioners that has the final say on this bond issuance, even though it also required the city council’s approval. At its meeting last week, the city council approved the bond issuance, after amending the proposed project list—by deleting some of the items, and re-ranking others in priority.

Crossed off the list was a path connection between Lower Cascades Park and Miller Showers Park, which had a price tag of around $3.2 million.

Also crossed off the project list was the replacement of gas-powered equipment with electric equipment. Councilmembers want the equipment replacement to happen, but don’t think that bonds are necessarily the right funding mechanism.

Left on the list are protected bicycle lanes on 2nd Street, a North Dunn Street multi-use path, and a Griffy Lake Trail dam crossing, among others.

At Tuesday’s meeting of the board of park commissioners, James Whitlach and Ellen Rodkey attended in person. Kathleen Mills chaired the meeting from the Zoom interface, appearing on the screens mounted on the walls of city council chambers where the meeting was held. Israel Herrera was absent.

The fact that Whitlach and Rodkey were present in person meant that the board satisfied the ODL requirement that at least 50 percent of park commissioners were present in person. Adding Mills meant that the board satisfied a quorum for voting on ordinary agenda items.

The ODL lists out some kind of actions that preclude electronic participation. Establishing raising or renewing a tax is the last of seven kinds of actions spelled out in the ODL that preclude a board member’s participation by electronic communication: [IC 5-14-1.5-3.5]

(i) A member of a governing body may not participate in a meeting of the governing body by electronic communication if the governing body is attempting to take final action to:
(1) adopt a budget;
(2) make a reduction in personnel;
(3) initiate a referendum;
(4) establish or increase a fee;
(5) establish or increase a penalty;
(6) use the governing body’s eminent domain authority; or
(7) establish, raise, or renew a tax.

Issuing general obligation bonds means raising property taxes. The parks bonds are part of a pair of two $5.8 million bond proposals in Hamilton’s revenue package. The other $5.8 million worth of bonds, for public works projects, received its final approval from the city council last Wednesday night.

The increased property tax rate to pay the debt service on one of the $5.8 million bonds is estimated at 3.3 cents. Bloomington’s current general fund property tax rate is about 61 cents.

For a property with an assessed value of $250,000, subtracting the $45,000 homestead deduction leaves $205,000. The supplemental deduction of 35-percent on that remainder leaves $133,250 as the net assessed value.

So an extra 3.3 cents of tax on that net assessed value ($133,250*.00033) would work out to $43.97 more in property taxes per year. For both bonds, for a property with $250,000 in gross assessed value, the additional property tax would work out to about $88 more a year.

The $5.8 million for each of the bonds is at the limit for a “controlled project” under state law. In 2017 the threshold for controlled projects was raised from $2 million to $5 million plus a growth quotient each year. The amount above $5 million reflects the growth quotient.

They’re called “controlled projects” because any greater general obligation bond issuance would be under the control of potential remonstrators, who could push the issue to a referendum.

At least part of the reason Hamilton’s administration wanted to issue some of the bonds through the board of park commissioners is that they don’t count towards statutory debt limits.

The city generally has a debt limit equal to 2 percent of the adjusted value of taxable property in the city. [IC 36-1-15-6] But the park bonds don’t count toward that limit. [IC 36-10-4-35]