Wage freeze but no layoffs in Noblesville’s proposed 2021 budget

Citing decreased tax revenues caused by the coronavirus pandemic, Noblesville Mayor Chris Jensen has proposed a hiring and wage freeze in the 2021 city budget.

But no layoffs are planned and employees won’t pay more for health insurance.

Jensen said the hiring moratorium and the hold on raises will save $1.6 million. The city will cover any increase in insurance with allocations from the general fund.

Noblesville Mayor Chris Jensen.

“In the spring when the pandemic started I asked my staff to look at savings,” Jensen said. “We knew doing away with raises would be a hardship so we wanted to make sure employees did not have to pay more for insurance.”

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Jensen presented his 2021 budget outline to the City Council at a workshop Tuesday and the council will formally begin considering it at a meeting on Sept. 15. It will look similar to the $69.5 million 2020 budget with most departments seeing no increase or a slight decrease and with public safety seeing a small increase. 

The only hiring in 2021 will be for four police officers, whose employment was approved this year.

The city has a $16 million surplus that has not yet been tapped but Jensen said “the plan is to dip into in the future.”

Large road and bridge projects and public-private developments will proceed, Jensen said, serving as economic generators as the retail and service industry lags.

Because of a lag in how local income taxes are distributed, the city won’t feel a drop off in those revenues until 2022. Last year, it provided Noblesville with $17 million. Next year, it will provide $23 million but that is expected to drop to about $20 million for 2022, said City Councilman Greg  O’Connor.

“The 2021 budget will mirror 2020,” O’Connor said. “We won’t be hiring people unless we see a real need somewhere but our balance sheet is in pretty good shape, especially with our surplus.”

Though the pandemic has hurt restaurants, O’Connor said overall sales are not as bad as one would have predicted, based on receipts from the local food and beverage tax.

He said those revenues are expected to drop from $1.8 million to $1.6 million.

“The carryout business has increased substantially,” O’Connor said.

One tax that will nearly dry up is the ticket tax at Ruoff Music Center, which has generated as must as $700,000 a year. The venue has cancelled more than 20 shows but is holding some drive-in concerts.

Call IndyStar reporter John Tuohy at 317-444-6418. Email at john.tuohy@indystar.com and follow on Twitter and Facebook.