By Sue Botos
City Council members will include a possible income tax hike and gauge the effects of North Olmsted’s mayor’s court as it considers the fate of its 2013 budget.
The income tax hike would offset the elimination of the estate tax by state legislators.
A public hearing of the city’s financial plan is scheduled prior to the Jan. 28 council meeting. The measure must be approved by March 31.
Mayor Pam Bobst noted that the budget, which has been in the works since September, was placed on hold several times due to collective bargaining with employee unions. She said that while the measure is less flexible, due in part to the cutback of transfers from the general fund to various departments, it is more straightforward.
“Our major revenue sources have had a slight uptick,” she reported, adding that this stability will not offset the effects of more than $3 million in state cuts.
“We’re ending 2012 in a stronger position than we anticipated,” she said, noting that the only wage increase for nonunion employees will be due to the increase in the minimum wage from $7.70 to $7.85.
Although state cuts of the tangible personal property tax and utility credits have left a hole in the budget, it was the elimination of the estate tax, which had generated up to $2 million for the city in the past, that has caused the most concern.
“There is still a line item, and we will still get some estate tax money from 2012,” said Bobst, referring to the $650,000 still to be processed from 2012. These dollars have been used only for capital improvement projects, and Bobst has proposed an income tax increase to offset the absence of the estate tax.
“I suggest that if we were to do this, (the funds) would be designated only for capital improvement and equipment purchases.”
Although the city is expected to collect about $500,000 in sewer fees due to the new billing system, Bobst said federal and state EPA mandates are not going away. “We’re looking at tens of millions of dollars here,” she stated.
The department facing the biggest change this year both financially and personnel- wise is the municipal court, which is still predicted to be self-sufficient despite the establishment of the North Olmsted Mayor’s Court. The Rocky River court will still be shared by Bay Village, Westlake, Rocky River and Fairview Park for all cases. Councilman Michael O’Donnell, who heads council’s Judicial Committee, reported that court revenues are projected to exceed expenditures by $90,000.
Although the court is a separate entity from the city, its budget must still be reflected in the city financial plan.
“This will be a very difficult time. The numbers don’t tell the whole story,” Judge Donna Congeni Fitzsimmons told council. She reported that $200,000 has been trimmed from court employee wages due to retirements, reduction of hours and pay cuts.
“We don’t know what to expect, but we’re ready to do whatever it takes,” she added. Communication with lawyers will be strictly by e-mail, she said, stating that the $50,000 spent on postage last year will be greatly reduced.
Clerk of Courts Deborah Comery reported that her office has trimmed 10 employees, four full-time and six part-time, due to attrition and retirements. This translates to a savings of $250,000. She said that this matches the staff level of 1997.
Answering a question by Councilman Dave Furry, Fitzsimmons said that no former Rocky River Municipal Court employee had gone to North Olmsted’s mayor’s court.
Council President Jim Moran asked if any measures had been taken to ensure that other cities would not follow North Olmsted’s example and set up a mayor’s court. “We did bring in all of the mayors for a meeting, and we believe that the mayors do not have the intention to do this,” Fitzsimmons said. She added that there will continue to be meetings with representatives of the other cities sharing the court, keeping them up to date on financial issues.
Fitzsimmons added that everything possible will be done to keep the court from turning to the cities for support. “We’re going to be as proactive as possible; we don’t want to go to that well,” she said.