Unigov to the rescue: Consolidation saved Indy’s economy, tax base

In the late 1960s, just as the word “Rust Belt” entered modern vocabulary to describe the Industrial Midwest, Indianapolis devised a bold new strategy for its economic future.

Unigov — short for unified government — was a plan to increase governmental efficiency and halt the erosion of the tax base by merging the city of Indianapolis with the surrounding Marion County.

Conceived by Mayor Richard G. Lugar and other Republican leaders and authorized by the Indiana General Assembly in 1969, Unigov became a national model for dealing with urban blight. In the eyes of many, it saved Indianapolis from the fate of Detroit, Gary and Toledo, among other struggling cities.

It “laid the foundations for the emergence of the modern Indianapolis,” former Mayor William H. Hudnut said in a 2005 interview with the Indiana Magazine of History. “Unigov represented a dramatic and successful initiative to reform governance structures in Indianapolis.”

The factors setting the stage for Unigov were varied and complex.

Prior to Unigov, Marion County was a confusing patchwork of 60 different governing bodies: the county, 23 cities and towns, nine townships, 11 school districts and 16 special purpose units such as the Indianapolis Airport Authority. With so many competing entities, it was a challenge to collaborate on issues facing the entire metropolitan area.

The issues covered the spectrum from poverty to a declining industrial base. Linda B. Weintraut, writing in the Encyclopedia of Indianapolis, blamed increased mobility after World War II for the decline of central cities. The development of residential subdivisions, shopping malls and suburban office buildings had all sucked commerce and residents from Downtown Indianapolis, which in turn hurt tax collections.

The passage of Unigov stabilized the city budget, restored its AAA bond rating and led to an outpouring of funds — federal and private — for community and commercial development projects. Some of the most visible were Market Square Arena, home of the Indiana Pacers; a $4.7-million renovation of the City Market; a $46-million Merchants Plaza hotel-office complex and the new American United Life Insurance building.

Attorney Eugene Lausch, who headed the Division of Code Enforcement of the new consolidated government, said efficiency in planning and zoning was an immediate benefit, but there were “soft” advantages, too. “It created a sense on the part of people in suburban areas that we were all in this together,” he recalls.

Unigov was not a complete consolidation nor a perfect remedy. For example, it did not combine fire or police departments (the Marion County Sheriff and Indianapolis Police Departments merged in 2005), and it left intact the cities of Lawrence, Beech Grove, Speedway and Southport. By far the most notable omission was the schools.

The Indianapolis Public Schools Board had preferred a unified school district, but political reality of the time would not allow it. The IPS schools were predominantly black, the township schools mostly white. “To have included schools in Unigov would have raised the specter of racial integration … and would have meant instant death for the plan,” the Rev. Landrum Shields, IPS school board president, acknowledged at the time.

A year after Unigov took effect, U.S. District Judge S. Hugh Dillin ruled that Indianapolis schools were unlawfully segregated; in 1975 he ordered busing of IPS students to the townships, an action that would have been unnecessary in a consolidated school corporation.

The question is often posed: What would Indianapolis look like today had Unigov not been approved?

A 2014 report, “Forty Years after Unigov” by Jeff Wachter, suggests a very different landscape, both figuratively and literally. Most certainly Indianapolis would be a smaller city with a smaller budget and fewer of the amenities that characterize vibrant city life.

Andrea Neal is an adjunct scholar with the Indiana Policy Review. Contact her at [email protected].