Battle erupts over Clerk-Treasurer report


It seems the gloves are off and the bell has rung.


Last week, Clerk-Treasurer Diana Cordray released a report to the public to ask for an independent audit of the debt of the Carmel Redevelopment Commission to determine the level of risk of a Special Benefits Tax if the city can’t pay off its bonds.

The report ignited a fire for two reasons.

First off, Mayor Jim Brainard, his supporters on the Carmel City Council and his accounting firm, Umbaugh & Associates, all felt that Cordray’s assertion that Carmel has a dangerous level of debt to be ludicrous and inaccurate.

Secondly, a comment was accidentally left in a flow chart attached to the report which shocked people. Some call it an innocent, unintentional joke. Others say it’s a vulgar, immature attack.

When listing what to do if Carmel didn’t have enough money to pay off its debt, the report instructs people to, “Shoot council, castrate mayor, Put head between legs, Kiss [explicit]goodbye!”

This was seen as the final straw by many who were tired of seeing Brainard attacked in the media.

Loren Matthes, of Umbaugh, sent out e-mails to defend her firm’s projections about Carmel’s fiscal future.

“I don’t think it is helpful for this to be portrayed as just a ‘joke’ by the media as it is a serious matter,” she wrote. “The truth of the matter is this is about envious politicians who have been trying to undermine the Mayor’s projects and do not appreciate the sophisticated financings. They have tried to manufacture a phony fiscal crisis to scare taxpayers into fearing inability to pay debt or a looming tax increase, when, in reality, Carmel is one of the wealthiest cities in the country with a tax base of $6.5 billion.”

Mike Shaver, a consultant with Wabash Scientific, helped Cordray created the report with additional help from City Council President Eric Seidensticker.

Seidensticker said he wrote the “joke” comments, but Shaver takes responsibility for accidentally leaving them in the report. He said the “irony of the situation” is that the joke was about how extreme it would be to allow Carmel to reach the level when it couldn’t pay off its debt.

“Inserting humor into a public discussion is always a risk, but in this case, a careful reading of the humorous flow chart shows that Eric Seidensticker understands the consequences of failing to assure the taxpayers that this fiscal issue is under transparent control,” he said.

Shaver said he thinks Brainard is trying to use the comments as a distraction from the real substance of the report which is about the seriousness of Carmel’s debt situation.

“I believe the CRC has reached a point where politics must be replaced by unbiased fact,” Cordray writes.

But city leaders are questioning Cordray and Shaver’s credentials when it comes to financial planning.

Brainard said Cordray’s report, “is typical of the sloppy work she has provided the council and the taxpayers.”

Matthes shoots back that her firm is certified as independent and meets strict guidelines in that regard.

“Mike Shaver, owner of Wabash Scientific, is not ‘independent’ in his current advisory role to the Clerk-Treasurer. Furthermore, it would not be considered an “independent” analysis if he or anyone were to take Umbaugh’s analysis and simply apply different assumptions directed by the Clerk-Treasurer or members of the City Council,” she writes. “There is no reason for the City to have a second independent TIF Report from another firm, and, in fact, it would be confusing to the bond rating analysts, bond market, let alone Carmel taxpayers.”


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