Against the backdrop of an intense debate over whether to raise taxes, Mayor Joe Hogsett presented his proposed $1.9 billion budget Aug. 10 to the City-County Council.
“Every detail of this budget matters because every cent represents a commitment to the people of Indianapolis,” Hogsett told councilors and members of the public.
The budget is a nearly 11% increase over last year, despite expected constraints caused by state property tax cuts and the need to find $50 million in new revenue to match state road funding.
In anticipation of the lost revenue from those property tax cuts, Hogsett in 2025 asked most departments to cut their budgets by 4%. It’s unclear if those budgets have been restored for 2027.
Hogsett also said his budget meets the state’s requirements to provide matching funds in exchange for state road funding without raising vehicle fees. State lawmakers passed a law in 2025 to provide millions in road funding to Indianapolis, but only if the city could match the funds.
“Let me be perfectly clear. This proposed budget meets that commitment,” Hogsett said. It also meets future commitments, he said — the money the city must put forward increases every year.
The council had previously passed increases to wheel and excise taxes to raise the required funds, but Hogsett vetoed the measure.
The council voted 17-7 to override Hogsett’s veto, a move that was met with cheers from attendees. It’s unclear how this will impact the 2027 budget.
DPW sees biggest increase
With the $100 million influx in state and local funding, the Department of Public works will see the biggest budget increase of any department.
Improvements for the coming year include a new roundabout at 46th Street and Mitthoeffer Road, improvements to the Pleasant Run Greenway from the White River to Ellenberger Park, and converting one-way streets to two-way streets downtown.
DPW will also spend $15 million for renovations to its largest operations garage on West Street.
IMPD budgets for staff despite vacancies
The Indianapolis Metropolitan Police Department is slated to fund 1,743 positions, continuing a trend of the department receiving funds for hundreds of positions that it fails to fill. The current force is short roughly 350 officers.
Chief Tanya Terry said the department continues to provide the same level of service expected of the department through overtime.
If the budget is passed, IMPD will also have money for new fleet vehicles and $12.5 million for a new north district headquarters, which would be the first city-built and city-owned police district since 1995. The current north district facility is located on East 30th Street.
Slow transfers keep people in county jail
Abby Hanson, the city’s controller, noted that one of the challenges to balance this budget is the jail population, which she said is bigger than it should be.
That’s because as much as 10% of inmates held there are awaiting transfer to Indiana Department of Correction facilities, she said. The state pays the city to house those people, but the rate is not enough to cover the costs of keeping them.
City expects opening low-barrier shelter in 2027
The city already has broken ground on the long-awaited “housing hub” on Georgia Street. The city expects the project to open in 2027 with 150 beds, according to Office of Public Health and Safety director Andrew Merkley. A $2.7 million operating budget is included for 2027, Hogsett said.
About $72 million is budgeted for housing initiatives next year, including the city’s Streets to Home and Eviction Diversion programs. Streets to Home is a rapid rehousing program to get unsheltered people into housing quickly. The Eviction Diversion Program provides resources to tenants facing eviction.
The city will continue funding the Assessment & Intervention Center, which assesses people for mental health and substance use disorders and refers them to treatment. The city previously cut funding from that program due to lack of use. It is unclear if that funding was restored, but Merkley noted that usage is up this year.
That’s in part because the city is using some of the 60 beds for winter contingency, when the city provides shelter for homeless people during cold months. The city expects to continue to use some of the facility’s beds following the passage of a state law that prohibits long-term camping on public land.
Merkley also said the department would “realign” some of the funding behind its work providing resources to people leaving incarceration.
Other funding highlights
City officials highlighted several components of the proposed budget, including:
- 3% cost of living raises for non-union city staff, and 3%-4% raises for union staff
- Pay increases of 10% or more for Mayor’s Action Center and Metropolitan Emergency Services Agency employees after those departments unionized
- This year, the city expanded the clinician-lead community response program to cover the entire county. The city will continue to fund the county-wide program next year.
- An increase of 20% to the Indy Parks facility maintenance budget
The Aug. 10 council meeting marked the start of more than two months of deliberations and public hearings on each department’s budget. The council will hold a public hearing on the full budget on Oct. 5, and will hold a vote on Oct. 19.
Questions?
Mirror Indy, a nonprofit newsroom, is funded through grants and donations from individuals, foundations and organizations. Sign up for our free newsletters.
Local government reporter Peter Blanchard contributed reporting.
Emily Hopkins is a senior reporter at Mirror Indy. You can reach them by phone or Signal at 317-790-5268 or email at emily.hopkins@mirrorindy.org. Follow them on most social media @indyemapolis or on Bluesky @emilyhopkins.bsky.social.
Republish our articles for free, online or in print, under a Creative Commons license.
