City to discuss future fiscal issues
STEUBENVILLE – City Council’s finance committee will meet on July 22 to start considering “all options,” as the city faces a projected five-year fiscal deficit in the general fund and wastewater fund.
“The 2016 projection is bad, the 2017 projection is worse and the 2018 projection is God awful. We need to start preparing today for the sewer and general fund deficits,” 3rd Ward Councilman and finance committee Chairman Greg Metcalf stated during a Tuesday night finance committee meeting.
According to a five-year forecast prepared by the city’s finance office, the city is projected to finish 2014 with a $906,494 cash balance. The projected cash balance in 2015 drops to $198,667, while 2016 is projected to end with a $835,365 cash balance deficit.
The projected cash balance deficit grows in 2017 to $1,869,397, and the 2018 cash balance is projecting a $2,903,429 deficit, the finance department forecast indicated.
The city’s cash balance issues are compounded by the sewer fund that is projecting a $401,052 cash balance deficit in 2016, a $1,658,979 cash balance deficit in 2017 and a projected cash balance deficit of $2,916,906 in 2018.
“Looking at our short-term financial reports, our income tax receipts are running ahead of last year but have been declining during the past three months. That certainly bears watching. Our general fund, water and wastewater funds need our attention. Approximately 60 percent of our general fund goes to our safety forces. The finance department and I have to look at our options as we move forward. 2016 and 2017 will be very difficult if we don’t take steps now,” said City Manager Tim Boland.
“Everything has to be on the table when we meet on July 22. Maybe we should look at bundling some of our debt,” suggested Metcalf.
“Our expenses continue to go up while our revenue continues to decrease. We need to start looking at all options and determine the path we want to take to resolve these issues,” Metcalf said after the council meeting.
“We should be able to come to the finance committee meeting in July with a capital improvement program. We also have a narrowing window of low interest rates. And, our improved bond rating puts us in a better position to make a move on our debt,” noted Boland.
Councilman at large Kenny Davis recommended revisiting a safety levy issue.
“Maybe we should look at a safety levy again. We should reach out to the public. It is our house that is broken and we need to fix it. But if we consider a safety levy the council will have to be behind it 100 percent,” said Davis.
“This council and administration has created trust and if we continue to build that trust, the public can get behind us,” Davis added.
And, 2nd Ward Councilman Mike Johnson said the city should be prepared “to show the public our expenses have come down. We need to look at where we can share services and where we can consolidate. We can’t wait until 2015, 2016 and 2017, or we are in trouble.”
Metcalf cited the loss of Local Government Funding as the reason the city has been struggling financially for the past four years.
Council also expressed concern regarding Ohio House Bill 5 that will allow the state to assume collection of municipal income taxes in the future.
“This has been on our radar for some time. The bill is now in the state Senate and it is expected to come up again in the fall. We need to consider approving a resolution opposing this bill because it will mean more losses in our revenue,” warned Metcalf.
In other business Tuesday night, council agreed to consider a future ordinance changing the vacation policy for department heads and management employees.
Boland had asked for new non-union employees to be granted vacation time during their first year on the job.
Council heard from city business owner Mark Nelson, who begged city officials to deal with crime in the community.
“We could easily be attending a funeral for a 5-year-old this week after the Monday morning shooting.
“It happened in our city and we rely on the city to act properly. We need to reach out to make our city better. The state police command a presence as soon as they step out of their car. We need that same presence here,” remarked Nelson.
City resident John J. Mascio spoke on behalf of the Charter Review Commission declaring the work to review the 30-year-old charter is finished.
“It is now up to City Council to take the appropriate steps to submit the proposed changes to the Jefferson County Board of Elections,” Mascio said.
He also asked the city administration to consider sealing city streets this summer in order to preserve them for the long term.
Council heard the first reading for several ordinances including:
The adoption of the one-year action plan for the city’s Community Development Block Grant funds.
Authorization to create an adopt-a-lot program for nonprofit corporations or organizations.
The creation of a criminal nuisance law to allow the city to fine repeat property owners.
Second readings were heard for:
Authorizing the city manager to sign a contract with HDR Engineering Inc. for professional services.
An ordinance authorizing the city manager to request proposals for a health insurance broker.
The council met in executive session following the regular meeting for an update on contract negotiations with the American Federation of State, County and Municipal Employees Local 2015 and for a six-month job evaluation of Boland’s performance as city manager.