Lake County could borrow from Porter County to make up budget shortfall
By Carrie Napoleon Post-Tribune correspondent October 17, 2012 2:17PM
Updated: November 19, 2012 3:13PM
CROWN POINT — County commissioners may be looking to a neighbor for a little help in funding an approximately $15 million budget shortfall in 2013.
On Wednesday, Board of Commissioners President Gerry Scheub, D-Crown Point, said it may be possible for the county to borrow funds from Porter County instead of going through a bank. Scheub said he has had conversations with Porter County Treasurer Michael Bucko, and the county seems open to the idea.
“Porter County has got an enormous amount of money left from the hospital sale,” Scheub said, adding Lake County officials are negotiating with Porter County officials for a loan that would have a lower interest rate than the county would receive in the traditional bond market. The move could save Lake County 1 point or more in interest and potentially about $1 million over the life of the loan.
John Dull, attorney for the Board of Commissioners, said the Lake County Council approved 5-2 a request that commissioners go forward with the process to sell $15.5 million in bonds in 2012 to shore up the 2013 shortfall. Dull said he would suggest officials obtain proposals from banks and Porter County so when the council is ready to move forward, commissioners will be able to choose the most cost-effective funding mechanism.
“What (Porter County officials) are trying to do is fill in a gap … and invest that money,” Dull said.
Porter County stands to more than double its return on the money it would loan to Lake County over what it would make on those funds in interest from a bank, Dull said. Porter County made a similar loan to Hammond.
“It’s not like they are trying to be our good friends. It’s financially beneficial to them, too,” Dull said.