Council discusses finances, junk items

DAVE MOSIER/independent editor

Van Wert City Council spent a lot of time discussing city finances and the junk/junk vehicle issue in the city before a last-minute discussion on what to do about the Van Wert Economic Development Office.

Finance Committee members and other Council members held a lengthy discussion on the city tax budget and three-year financial plan, with City Auditor Martha Balyeat sharing her concerns about some potential financial problems that could arise down the road.

“Not to be an alarmist, but I think we have a potential situation that we need to be prepared for,” Balyeat said, noting that current projections for 2013 show the city with a carryover of only $372,000 — below the 10 percent reserve required by ordinance. If that scenario would occur, the city could see a shortfall of $90,000 in the 2014 city budget, more than $600,000 less than needed to fulfill the reserve requirement and also leading to a budget deficit situation.

“There is no quick fix, so we need to start thinking about things we can do,” the auditor noted, adding that there might not be time later to fix a deteriorating financial situation if a plan isn’t put into place soon.

Mayor Don Farmer used a weather term to describe the city’s current financial position, calling it a “watch situation” in which conditions are favorable for financial problems down the road if nothing is done.

As an example, Balyeat said raising an additional $600,000, if projections for 2014 pan out, would mean having to increase taxes 18 percent — something that would be very unpopular with city voters who would have to approve any tax increase.

While the auditor doesn’t think such a scenario is likely, she added city officials need to have a plan in place that provides a number of ways to cut costs and increase revenues, just in case.

Currently, the city is in good shape, with a 6 percent increase in city income tax revenues — 3 percent above projections — and operating costs below revenues, but Balyeat noted that, even with increasing local tax revenues, cuts in state funding have resulted in little or no overall revenue growth. That situation, which the auditor said was a concern, is coupled with increases in operating costs she estimated would be in the 2 percent range in 2013, although she said those estimates were conservative.

Both the mayor and Balyeat were in favor of having a plan in place in case the city’s finances worsen over the next two years.

So was Finance Chair Joi Mergy, who asked for a meeting to further discuss the issue.

Following the Finance Committee meeting, the Health Service and Safety Committee met to discuss legislative changes recommended by Law Director John Hatcher to give the city more enforcement options concerning junk vehicles and other junk items.

The recommendations include setting the age of junk vehicles at three years of age and older, requiring that any junk vehicles be hidden behind a “non-transparent barrier,” such as a fence or hedge 6-10 feet high, and amending the city’s junk ordinance to prohibit parking of junk vehicles in a person’s yard, unless hidden behind a barrier.

Council unanimously approved preparing legislation incorporating the amendments in its regular meeting held afterwards.

The mayor had some good news for Council, noting that the final piece of the agreement with the Ohio Department of Development concerning the Jobs Ready Site has been received. Farmer said those documents, coupled with the fact that purchase options on the 1,600-acre megasite, as well as options on land needed for a railroad spur to the site, have been renewed, put all the pieces in place for work to begin at the site. The mayor said work at the site should be completed by December 2013.