The last of Fort Wayne's recent $8.8 million "windfall" of unexpected income tax revenue will likely go toward the city's share of a $17 million upgrade to the city-county 911 radio system.
City Council voted Tuesday to endorse Mayor Tom Henry's plan to pay in cash for $4.2 million of the overall upgrade. The surprise local income tax revenue paid out by the state earlier this year would help Fort Wayne avoid financing its entire share of the 911 overhaul while also maintaining the city's main cash fund.
"We were fortunate to have cash reserves where we could pay for the emergency radio backbone without financing" the entire plan, said Valerie Ahr, the city's deputy controller.
About $3.8 million of the expenditure will come from the surprise income tax money, depleting what remained of the windfall. Ahr said the city would dip into its general fund, which stands at about $17.5 million, for the other $400,000.
Meanwhile, Fort Wayne will finance about 1,600 new emergency radios, a $5.5 million purchase, through a payment plan with Motorola.
Council President Tom Smith, R-1st, said he was happy that Henry's administration chose to spend cash on at least part of the 911 system upgrade. The city is putting all the unexpected income tax revenue to good use, he said.
"It's been wisely used, and I though it should be used, because it's money outside the budget," he said. "I'm always in favor of always trying to pay cash where we can."
Henry already earmarked about $3.5 million of the unexpected cash influx for street work and $1.5 million for ongoing efforts to remove thousands of trees infested by the emerald ash borer.
Indiana counties got the money after the state discovered it had underpaid local governments by more than $200 million in taxes collected by the Indiana Department of Revenue.
Although Fort Wayne will pay cash for only part of the radio upgrade, Councilman Geoff Paddock, D-5th, said the city is getting a good deal on the whole package. The financing plan with Motorola comes with an interest rate of about 1.5 percent, he said.
"The interest rate is extremely low, so the financing is very attractive," he said.