Porter comments on Comptroller’s mistake affecting $20 million in funding for Gary, East Chicago, Michigan City and Hammond

Today, Jan. 15, the Indiana State Comptroller, previously called the State Auditor, testified in front of the House Ways and Means Committee. During the testimony, it was revealed that the office failed to properly distribute deficiency payments to certain communities. The City of Gary will be required to pay $20 million to East Chicago, Michigan City and potentially Hammond due to this mistake. 

State Rep. Gregory W. Porter (D-Indianapolis) released the following statement: 

“I’ve served for several decades, and this is not the first time our comptroller has made an egregious error. I’m getting déjà vu since two accounting errors were made by the executive branch, the Department of Revenue and the auditor in 2011 and 2012. The state corporate income tax and local income taxes were collected, put into certain accounts and then lost. We couldn’t find over $500 million that we needed for the budget. We had to hire a private accounting firm to find that funding.  

“Now, the same type of mistake has happened. Two casinos were moved from Gary to I-94 impacting existing casinos in Hammond, East Chicago and Michigan City. To mitigate potential revenue losses, the legislature chose to provide the affected communities with deficiency payments from 2022 to 2025. 

“The state comptroller never triggered these payments. Now we’re scrambling to get these communities close to $20 million. If the law does not change, the funding will be taken from Gary slashing their 2025 budget of $66 million by close to a third. 

“Again, I don’t know why there was a lapse in practice despite spending thousands for a firm to prevent additional errors. I’m sure this mess will be cleaned up, and communities will receive their entitled funds. 

“But a couple of things must be guaranteed. Gary, who is not at fault, should be able to repay the funds over several years, preferably through a 20-year rainy-day loan with no interest. Michigan City and East Chicago should receive an immediate one-time payment from the state including interest. Why shortchange our cities when the state didn’t do its job? Since House Democrats represent all of the affected communities, it’s only right that we have a seat at the table in crafting a solution.”