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Finance committee reviews street department budget, hears repeated State Board of Accounts finding on motor-vehicle highway funds
Summary
Muncie City finance committee reviewed the street department budget for 2026, discussed a $1.3 million placeholder tied to federal match requirements, capital equipment replacement, consolidation of staff line items, and a repeated 2023 State Board of Accounts finding about improper use of motor vehicle highway restricted funds.
The Muncie City Council Finance Committee reviewed the street department's proposed 2026 budget and discussed capital replacements, line-item consolidations for positions, and compliance issues tied to the motor vehicle highway (MVH) restricted fund.
City Engineer and Director of Public Works Adam Leach told the committee the $1.3 million reduction shown for local roads and streets was a placeholder tied to timing on federal projects that require a 20% local match. "The projects that we have in coming are basically Fulton and McGuyard, which is more of a 2027 project. But both of those are anticipated at least a million dollar match," Leach said. He said some MVH funds are currently covering Columbus Avenue work, which is entirely reimbursable and can cause timing differences while the city awaits reimbursement.
The committee discussed consolidating multiple position line items into single lines to allow flexibility across classifications. Leach described the personnel approach as giving the department flexibility to shift duties while still following the collective-bargaining contract and promotion procedures.
On capital, Leach said the department plans to replace its oldest truck, a 2012 model, with a tandem truck priced at about $215,000 and noted other funds go toward debt service for trucks purchased three years ago. "This will kinda get us caught up a little bit," he said.
The committee also reviewed insurance and equipment-repair lines, overtime usage concentrated in winter months for snow response, and higher parts costs driving repair-and-maintenance increases.
The session turned to compliance when a committee member read from the 2023 State Board of Accounts report, which the committee described as a repeated finding. The reading summarized the audit's conclusion that the city "failed to post at least 50% of funds received from the state motor vehicle highway account to the motor vehicle highway restricted fund as required" and that the restricted fund had been used for items the auditor said should instead be paid from MVH operating accounts. Committee members emphasized the need to follow state code on MVH distributions and raised the item as a continuing point of attention for future audits.
Committee members asked for clarification on transfers, other receipts, and auction proceeds that flow back into department budgets. Leach said equipment auction proceeds typically return to capital equipment lines and that some other receipts include reimbursements and non-state grants.
No final votes were taken on the street department budget during the working session. The committee chair said public comment would be taken at the final finance committee meeting and at ordinance adoption hearings.
The meeting adjourned after the committee completed its departmental reviews.
