Welcome to the Monday, October 19th, Carmel Finance Utilities and Rules Committee meeting.

We have two items on our agenda this evening ordinance D-2772-25 and ordinance adopting requirements for nonprofit organizations receiving public support from the city.

And resolution CC 10-5-26-02, a resolution finding that the city 2020 property 2027 property tax rate should not exceed 0.7783, which is the same rate as the 2026 rate.

And recommending how DLGF should allocate the 2027 property levy, property tax levy among city funds, authorizes temporary interfund borrowing for cash flow purposes only.

First item we have is ordinance D-27772-25.

We have corporation council here to discuss originally was a proposed an ordinance that's been on our packet for for some time establishing rules, but then also the administration had proposed some changes to the ordinance.

Would you like to go over the changes and why those are being recommended by the administration?

Benjamin Legg, Office of Corporation Council.

So the original ordinance has presented to council some moons ago.

So to some degree, there is an element of first impression that comes from our analysis, but also a caution as to extending the role that is provided for this body, the council body.

So when you take a look at the ordinance as presented, there are you can kind of split them, split it into two distinct um issues, if you will.

The first being one of scope related to the definition.

So when you take a look at the definition of affiliated entity, we have very broad, we have very broad language here.

It is entirely unclear from the reading of this definition, which contains uh five distinct subsections, how many non-profits would be pulled into this scope.

There is language that such as agencies utilized grant indirectly supports.

That type of language is unclear what non-profits would be brought within the scope of this council.

We have the first um subsection, uh, we have supporting organizations.

Those are broadly within the scope of this council.

Those are formed under the um IRS code, so related to 509A3s under federal law.

The one that exists for the city is Chris Kindlemart, uh, which we've dealt with for for a number of years

now.

Souncil already has an appointee and an actual council member on that board for the case.

That is my understanding.

My understanding is the articles incorporation uh for that entity uh were amended at some point to include a council appointee to be part of that board.

So that that's already

there.

The the other broad um language is something that quite frankly, I'm I'm not sure the scope

of

how far it goes, how many entities it touches.

Just uh for example, if you take a look at um subsection three, which is on line 33, it has a non-profit organization utilized by the city to directly or indirectly support or accept donations from sources other than direct tax or fee revenue support um revenue to support events or programs of the city.

Is

that the Rotary

Club?

With Carmelfest.

How far and that's a classic kind of look, but the truth is this city does a tremendous amount to support its nonprofits, um, and so it's unclear how far the scope would truly go, especially when you don't have defining terms as to what utilized means or indirectly supports means.

So let's put that aside.

That's a

problem.

Um if you wish to go down that route, you would have to properly define so you understand what the scope of an affiliated entity is.

The next aspect of it is so what then can council do if uh affiliated entity receives support, and the proposal is that they uh have an appointee on the board, but beyond that, the proposal is the remaining members of the affiliated entities governing body must be approved by a vote of the city council.

So we already have under Indiana Code laws that um control nonprofits.

Um Indiana Code um Article 2317 um handles that.

So what you would be asking this um entity to do would be to amend its bylaws in a manner

uh

sorry, amend its articles of incorporation in a way to then include a council appointee on it, and beyond that, and quite likely beyond the scope of powers that would be allowed under statute, would then um require all other members of that under those articles of incorporation to then be approved by this council.

It's an extremely broad stroke and it would not be something that we would recommend taking

on.

Um to the extent that this board wants to, sorry, this council wishes to um have some say or some element of oversight in relation to funding provided to non-profits, the proposal would be to follow a more traditional path.

And those traditional paths that have been set out previously would be uh reporting for entities that clearly fall under the jurisdiction of this um this body.

So in those instances, we would be the proposal from the administration, which I will put up, I have it here,

two

seconds.

And for the record, this was distributed a few weeks ago to the entire council and the finance committee.

On Monday night of the meeting.

Yeah, Monday night of the last meeting.

I I would say we uh as um this is something that we would want to um we would recommend still reviewing to the extent the council wishes to take a look at this um to allow legal to have a little bit more eyes on it.

Um but here is um the proposal to affiliated entities.

So we are narrowing the definition if you want to come down

to

uh line 38 um which runs through to line 42.