City of Newton Il. Exceeds statutory debt limit.
In the Fiscal 2012 audit for the city of Newton Illinois the auditors pointed out that on
4/30/2013 the city exceeded the statutory debt limit.
It is pretty darn funny when you think about it, the city of Newton has exceeded what the
state of Illinois has determined to be to much debt. The state of course being experts in
to much debt.
The auditors also pointed out that the city's portion of the IMRF retirement fund was
underfunded by over $1,000,000.
Update. The audit for fiscal 2014 shows that the city is using 87% of the debt limit now.
The problem that they have is that they love to take money from the cash cow electric
department for other uses (they call it a loan) but their is a pesky state statute that says
that any interfund loans have to be repaid within one year.
The scam that they have always used to get around this and make the loan more or
less permanent was that prior to May 1st every year they would borrow the money for
one day from the bank, repay the interfund loan, then re establish the interfund loan then
repay the bank.
The problem came up when the auditors pointed out that they could not borrow money
for even one day without going over the statutory limit.
The way that they now do it is just ignore the statute concerning inter fund loans.
Evidently the auditors are OK with violating this statute but not the debt limit statute.
Politicians can always find a way around any law that is intended to limit their spending.