State finds paycheck problems
NILES — After conducting a special audit and investigation, the Ohio Auditor found the city underpaid — by more than a quarter of a million dollars — six current and former employees who retired and then were rehired.
A letter addressed to Niles Mayor Tom Scarnecchia from Ohio Auditor Dave Yost and Randall E. Turner, deputy director of the public integrity assurance team, states the city overpaid six employees as well, but by less than $20,000.
“During the course of the investigation, we received allegations that several city of Niles retire/rehires had been overpaid due to special ‘overtime rates’ and improper carry-forward of sick leave time. Upon their rehire, former Mayor Ralph Infante entered into employment agreements with individuals allowing for overtime rates in excess of city policy. In addition, it was also alleged that Mayor Infante allowed individuals to carry over sick leave that had already been paid out at their retirement,” the letter states.
Six people were overpaid by a total of $18,449, but six were underpaid $263,963, according to city pay ordinances governing what they should have been paid for the positions they held.
Scarnecchia referred comments to Law Director Terry Swauger, who said the city disagrees with the auditor’s letter.
“We think the auditors got it wrong. The employees all signed contracts with the former mayor, contracts the city adhered to and that they adhered to,” Swauger said. “We have the letter and intend to do nothing about it.”
The letter does state it “does not represent a final determination. There could be other controlling documents that we were not made aware of that could further impact these calculations.”
But an attached document breaking down the individual situations states, “Based on our review and assessment of the authority of the mayor and city council as it related to setting wages, we concluded the employment agreements entered into between former Mayor Infante and the employees did not appear proper as the Mayor did not appear to have the authority to set wages.”
Infante, 61, was named in a November 2016 indictment on 56 counts, alleging political corruption and implicating him as the ringleader of an illegal gambling operation out of the Italian American War Veterans Post 39 he and his wife, Judy, owned in McKinley Heights. His next court date was supposed to be Aug. 14, but a request to continue it was filed Friday by his attorney, John Juhasz, Trumbull County Common Pleas Court records show.
The investigators looked at city ordinances set in 1984, 2012 and 2015.
Councilman Stephen Papalas questioned why auditors, who go through the city’s books annually, didn’t bring the problem to the city’s attention earlier. One of the discrepancies dates back to 2004.
Most of the overpayments were canceled out by underpayments.
For example, Carmen Vivolo, the former director of parks and recreation, was paid for 1,095 hours of sick leave between 2013 and July 31, 2016. But for 777 of those hours, he did not have sick leave available. Therefore, he was overpaid by $13,253. But when Vivolo was rehired after his initial retirement at an annual salary of $35,460, that violated a city ordinance requiring the person holding the position to be paid $55,860. So, Vivolo was underpaid by $61,200, offsetting the $13,253 overpayment, according to the state auditor’s letter.
David Liste, assistant superintendent of the light department, was allowed to improperly carry over 945 hours of sick time. People that retire and are rehired are supposed to start with a sick leave balance of zero. And, when Liste was rehired, he received a special overtime rate of $30.36 an hour, even though the ordinance states his position isn’t eligible for overtime.
Liste was paid for 106.75 hours of overtime, which he was not eligible to earn, resulting in an overpayment of more than $3,000. But because Liste was rehired at an annual salary of $41,556, and an ordinance set the salary for his position at $63,156, Liste was underpaid by $19,800, offsetting the overpayment, the letter states.
Lisa Smathers, the director of the income tax department who is expected to leave the city in the near future for full retirement, was rehired for $27,552 a year, but should have been paid $47,952 a year, so she was underpaid by more than $60,000 between 2013 and 2015.
Others who were overpaid include Brian Paridon, water department foreman, for $550; Glenn Randolph, sewer department foreman, for $90; Mark Hess, former grant and development coordinator for $1,131 that he repaid; and Mike Burke, former director of environmental health for $62, that he also repaid.
The amounts employees were underpaid were much higher than the overpayments, according to the letter. Joe Infante, light department foreman, should have received $61,201; Burke $52,700; and Linda Yuhasz, former deputy auditor, $7,862.
The city has been in state-appointed fiscal emergency since 2014, but is recovering. Its latest fiscal recovery plan was approved Thursday by the Niles Financial Planning and Supervision Committee.