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City’s finances moving in right direction, Rocco says

By Kevin Kelley

Fairview Park

Fairview Park enters 2014 in a good financial position, city officials recently said.

Mayor Eileen Patton summed it up this way at her annual state of the city address March 12: “We have money in the bank.”

The city ended 2013 with an overall surplus of $4.5 million, with just over $2 million of that in the general fund.

“We’re in good shape going into 2014,” finance Director Lisa Rocco said.

However, as the 2014 municipal budget stands now, expenditures will exceed revenues by approximately $2 million. A fund balance of $10.87 million overall – $3.9 million in the general fund – will allow for the shortfall.

The city’s goal is to continue pursuit of economic development projects that will enhance revenue over the long term, Rocco said.

Rocco said she expects tax revenue, including income tax revenue, to remain steady from 2013 into 2014.

“Our bread and butter is income tax,” Rocco explained. Income tax revenue, as well as property tax revenue, of which the city receives about 12 percent, had declined during the bleakest years of the Great Recession.

“Maintaining is the new ‘up,’” Rocco said, referring to revenue.

Still, the Patton administration has remained cautious about spending, Rocco said. The recently passed budget, as it stands now, calls for spending around $120,000 less in 2014 than in 2013. New expenditures can be approved by City Council later in the year.

Spending on new items and programs in the $24.5 million budget is limited, Rocco said. Examples of new expenditures include the first phase of a municipal computer system upgrade, costing about $60,000, and the replacement of the City Hall air conditioning unit, estimated to cost $40,000.

The city will spend about $600,000 in 2014 on sewer rehabilitation programs, service Director Rob Berner said.

An increase in employee salaries of approximately 3 percent for 2014 has been included in the budget, Rocco said. The city is currently in negotiations for new contracts with its three unions – police, fire and service – and has offered a 2.7-percent pay increase, city officials said.

Overtime costs for city service workers who cleared snow from the street this winter were higher than last year, Rocco noted.

“That’s the only negative I’ve seen, but that’s out of our control,” she told West Life.

In 2010, when the effects of the Great Recession were keenly felt, the city’s union employees took a pay freeze at 2009 levels. A $10 monthly trash collection fee was also implemented in 2010 to increase revenue.

As income and property tax revenue declined during the Great Recession, funding from Columbus was also cut. At the same time, Ohio eliminated its estate tax effective Jan. 1, 2013. However, Fairview Park received $2.6 million in estate taxes last year from a resident who died in 2012, Rocco reported. That helped the city’s financial position in 2013, she said.

Like many municipalities that relied on state funding, Fairview Park has had to adopt a new way of doing business because of changes made at the Statehouse, Rocco said.

“We’ve learned to adjust to the cuts in state funding,” she said.

At a March 10 City Council committee meeting, Ward 1 Councilman Brian McDonough proposed appropriating an additional $150,000 for new playground equipment and other improvements in the city’s parks. The city’s recreation department is developing a plan to improve its parks. Patton and Rocco suggested council wait until the plan is finalized to appropriate the money.

But McDonough expressed impatience and argued that unless playground money is appropriated now, improvements in the city’s parks may be delayed.

A motion to forward the Patton administration’s budget as written for a final vote, without the park appropriation sought by McDonough, passed 6 to 1, with the Ward 1 councilman voting no. But McDonough voted in favor of the main appropriations ordinance at Monday night’s council meeting, making the vote unanimous.

 

 

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