City Council looks at budget cuts, lawsuit

DAVE MOSIER/independent editor

Van Wert City Council looked at moving some money around to help balance the 2018 budget during its regular meeting on Monday, but the consensus is that cuts will still need to be made to keep the city in the black.

City Auditor Martha Balyeat noted that, although original plans were to cease using Street Fund monies to pay administrative salaries for the first time since 2000, the failure of the 0.28-percent income tax will force the city to continue using 25 percent of the fund for administrative salaries. That will allow the city to avoid using $173,655 from the General Fund to pay those salaries, helping balance the General Fund in 2018.

Balyeat also noted that the city would again use a full two-thirds of the Police and Fire Capital Fund — approximately $624,000 — to pay police and fire salaries and benefits, as allowed by law, to balance the 2018 budget.

The problem, she noted, is using money from those funds will deplete fund reserves.

“This solved the General Fund budget, but, again, we’re robbing Peter to pay Paul,” the city auditor said. “We’ve eaten up all of the reserves.”

Balyeat also noted that using Street Fund money decreases the amount that can be used for street construction, while using up the reserves also violates the city’s financial strategy, which calls for maintaining a 5-percent reserve to account for unexpected expenses.

The auditor also said cuts would be made in the Parks and Police department, with a parks employee to be cut and a retiring officer will not be replaced.

Councilman At-Large Jon Tomlinson said he feels the city should not look at placing the income tax increase back on the ballot, at least in 2018, noting his opinion that the city needs to look at more cuts to balance the budget.

“We need to decide on other cuts,” Tomlinson said, adding that he feels city residents have spoken on the issue of raising taxes, at least in the near future.

A number of cost-cutting measures have been discussed and others will now be looked at to help replace state funding cuts made over the past few years.

Unlike the federal government, states and municipalities are required to balance their budgets each year.

In addition to budget cuts, Balyeat also talked about the city’s involvement with a number of other Ohio municipalities in a lawsuit against the state on the issue of centralized tax collections included in recent state legislation. She said it has been recommended that the approximately 140 municipalities involved in the lawsuit not pass changes to their income tax ordinances needed to conform to the new law until the last minute.

Law Director John Hatcher said the reason cities should wait is to allow for the possibility of a temporary restraining order and injunction being granted to stop implementation of the law. The new state laws go into effect on January 5, 2018. If a restraining order and/or injunction is granted, the law would be put on hold until the matter is decided in the courts.

The lawsuit asserts that the new state laws violate municipalities home rule powers, among other things.

Mayor Jerry Mazur’s report consisted of a moment of silence for former mayor and City Council member Stan Agler, who died earlier this month.

During his report, Safety-Service Director Jay Fleming said Council would need to prepare legislation raising water and sewer rates for the second year in a row to pay for needed utility projects. The rate increases, 5 percent for water and 7 percent for sewer, have been planned to provide funds for the projects.

Council approved preparing the necessary legislation later in the meeting.

The safety-service director also asked Council to relook at the city’s taxicab ordinances, noting his opinion that taxi regulations needed updating. The Judiciary and Annexation Committee will hold a meeting on the issue at 6 p.m. Monday, December 11.

Legislatively, City Council also approved some end-of-the-year supplemental appropriations and fund transfers to balance the budget by December 31.

The next meeting of Van Wert City Council will be at 6:30 p.m. December 11 in Council Chamber on the second floor of the Municipal Building, 515 E. Main St.