Fiscal plan passes; tensions flare

NILES — The city is operating under a new fiscal plan and its finances have seen “significant improvement,” and a promising five-year forecast, said the chair of the Niles Financial Planning and Supervision Committee during a Thursday meeting.

“There is an increase in balance each year — that’s a good sign,” said Chairman Quentin Potter.

The city has to have a positive five-year forecast before it can be released from fiscal emergency by Ohio Auditor Dave Yost. The city was placed in fiscal emergency in 2014 with several funds operating at a deficit.

The meeting was marked by tension between Potter and John Davis, a member of the commission. The tension flared at the beginning of the meeting and continued through the 90-minute session.

Potter rebuked Davis for a letter to the editor published in Sunday’s Tribune Chronicle, in which Davis called for the resignation of Mayor Tom Scarnecchia, criticized the mayor’s ability to make financial decisions and questioned the administration’s estimation of the amount of money it will save if it outsources its income tax collection.

Davis’ letter questioned other city officials, including the service director and members of council who were serving between 2008 and 2015 when the city’s general fund balances plummeted.

Potter opened the meeting by addressing the letter to the editor, and asked Davis to go on the record stating the views in the letter were that of his own and not as a member of the fiscal commission. Davis did so, but the two bumped heads throughout the meeting.

Despite the heavy air, there was good news in the city’s financial reports.

Savings in overtime and bank fees were “significant,”said Tim Lintner, a state-appointed financial supervisor for the city.

Treasurer Janet Rizer-Jones’ push to switch from Huntington Bank to Farmers National Bank put the city on track to save $110,000 in service charges this year compared to last. A grant that paid for new firefighters led to a 72 percent reduction in overtime for the fire department, which went from $52,000 in overtime charges from January to June in 2016, to $14,000 for the same period this year.

All city departments charged nearly 28 percent less overtime in the first six months of this year, compared to last — when the city spent $284,000 on overtime payouts.

“All of these are very good numbers,” Potter said.

Davis was the only commission member to vote against the administration’s seventh version of its fiscal recovery plan.

Davis questioned whether the commission should vote for a recovery plan that includes a $1.2 million rebate from the Mahoning Valley Sanitary District. Mahoning County Common Pleas Judge Lou A. D’Apolito and Trumbull County Common Pleas Judge Ronald J. Rice have to approve the rebate, Davis said, and including it in the forecasts was premature.

Law Director Terry Swauger said a public hearing will be scheduled in the near future to give the MVSD, Niles, Youngstown and McDonald a chance to respond to a list of questions the judges have about the proposed rebates. Youngstown stands to get $3.2 million and McDonald $100,000, if the judges approve the deal.

Potter said the city received formal notice from the board governing the MVSD that it would receive the rebate, so it is OK to include it in the plan’s five-year forecasts.

And, Lintner said, if the city’s water department does not receive the rebate, there will be enough money in the water fund to have a positive five-year forecast and complete projects and expenses expected to come out — like paying back a nearly $1 million advance to the general fund.

The water fund ended 2016 with a $790,000 deficit, down from a deficit of about $2.5 million in 2014. The city is forecasting an ending balance of $946,00 in 2017, according to the plan.

Davis also spoke out against two new $5 license plate fee increases in the plan that are expected to raise $180,000 a year for road projects starting in 2018, calling it “taxation without representation.”

Potter said the city has the authority to pass the tax, and it isn’t the commission’s job to debate whether it was fair.