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4/6/2017 7:35:00 PM
EDITORIAL: Rail contract scofflaws need state rebuke

Times of Northwest Indiana

Contracts exist for the very important reasons of legal and financial stability in business dealings.

Try to break a legally binding contract, and one can expect the other side of the pact to compel compliance with the full letter of the law.

It's why people and organizations should never lightly enter into a contract — and why we support state efforts to compel Northwest Indiana communities to fulfill their commitments to commuter rail extension funding.

A joint conference committee of the Indiana House and Senate must speedily work out differences between two versions of the same bill that would accomplish this necessary task.

Ultimately, the bill would intercept local revenue Region communities already pledged to the commuter rail extension, even if town or city councils vote to reduce what they've already committed.

Reneging on legally binding contracts is precisely what the Merrillville Town Council recently voted to do and what the Gary City Council is considering.

Both communities previously pledged a set percentage of their local income tax funds, dedicated for economic development, to extending the South Shore Line from Hammond to Dyer.

The project is an important attempt to bolster Region public transportation and drive improved economic fortunes through related development, population growth and enhanced quality of life.

Leveraging matching state and federal funds for this important project depends on Region communities honoring their funding obligations — already forged through interlocal agreements.

Matching funds only flow to communities willing to pledge investments in themselves.

"If we can willy-nilly break our commitments when we sign contracts, then we can just forget about bonding (for the commuter rail extension)," Indiana House Rep. Ed Soliday, R-Valparaiso, said recently. "You might find somebody to buy them, but if they do, you're going to pay junk bond rates."

We agree with the remarks of Soliday, who sponsored the House measure to hold Northwest Indiana communities to their pledged South Shore obligations.

More importantly, it's imperative for the state to quash attempts by local government to break legally binding contracts.

What message does it send to any vendors or other entities considering business in Northwest Indiana if the precedent of ditching contract obligations is allowed to stand?

Our Region would be closed for business if such a practice were allowed to fester and spread. Government entities attempting to renege on contracts are no different than citizen scofflaws attempting to avoid tax obligations.

The joint House-Senate conference committee should work out any remaining differences on the revenue-intercept bill and get it back to both chambers for final approval and then a gubernatorial signature.

It's an important course correction for any community presuming to turn its back on contractual obligations.

Related Stories:
• State money expected for South Shore double-track project between Gary and Michigan City
• Gary approves symbolic gesture against funding South Shore expansion funding agreement

Copyright 2017,, Munster, IN

Editor, John C. DePrez Jr.; Executive Editor, Carol Rogers; Publishers: IBRC and IAR

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