MASSILLON, OH — The city ran out of money to pay police officers and firefighters Friday and remains delinquent on thousands of dollars in bills dating as far back as May.
It also must make a bulky $262,766 first-quarter payment to the police and fire pension fund by month’s end or face a penalty from the Ohio Police and Fire Pension Fund, like it did for the last-quarter payment from 2010.
But there is a bright spot in city finances. Through July, income tax collections are up 8 percent from the same time a year ago with $10.5 million collected for the general fund compared to $9.7 million last year. It’s the highest amount collected through this point in the year in the last decade.
But it’s also not likely enough to keep the city from again pushing bills into the next year.
“Those (police and fire salary) line items, we need to begin to fill those with transferred monies,” said Auditor Jayne Ferrero, noting that it has become a regular annual occurrence. “We’re seeing a rise in the income tax. That’s what we need to count on.”
The 11th-hour alternative budget approved by City Council in late March to avoid a citywide shutdown allocated $6.5 million for police and fire salaries, which was $285,000 more than the budget proposed by Mayor Frank Cicchinelli. Still short, but not by as much.
Those dollars have run out. Ferrero has begun the annual process of “scrubbing” other departments’ accounts and transferring unused cash to the safety forces. The budget fully funded all departments except the safety forces, as it has done in previous years.
“We’re not in as good of a position as we’ve been in the last couple of years,” she said. “We’ve come up with a deficit. I wish I could say I felt more positive about it, but I don’t. I think we’ll have a deficit going into next year, but how great it is I cannot say.”
Last month, Ferrero and Councilman Paul Manson pushed for Council to ask voters to increase the city income tax from 1.8 percent to 2 percent, but got no takers.
“It’s evident Council’s not willing to do anything,” Ferrero said about creating or increasing revenue. “They wouldn’t put an income tax increase on the ballot. That tells me they’re not interested in increasing revenue from that source so now we have to look at other things like a tax credit and hospitalization insurance.”
Decreasing the tax credit, which is given to city residents who work in another city with an income tax in order to prevent them from paying both places, was an idea first discussed by Cicchinelli in the spring of 2009. Cicchinelli never brought forward formal legislation and Council has not discussed taking it up either.
Insurance contributions from city employees, who currently don’t pay toward health care costs, will likely be a major issue during upcoming contract talks with unions, especially if voters in November defeat Senate Bill 5, which limits collective bargaining rights of public employees and requires a 15-percent contribution to health care.
While Ferrero has urged Council to create revenue, members have pushed for cuts and restrained spending. Council rejected proposals to buy two new police cruisers and two dump trucks for the street department earlier this month. No one, however, has pushed for layoffs. Cicchinelli refuses to cut jobs in the safety forces, which account for a bulk of general-fund spending.
The city has been playing catch-up on bills for months. Currently, it owes $21,920 from May bills; $29,595 from June bills; $60,555.75 from July bills and $87,086.28 from August bills.
Councilwoman Kathy Catazaro-Perry, a member of the finance committee and the Democratic nominee for mayor, said the Cicchinelli administration has not been fiscally responsible. She plans to have a strategic plan and conduct a performance audit if elected.
“I’ve been warning of this day,” she said. “We need to be careful. We need to watch. We need to talk about the departments’ needs.”
Catazaro-Perry is also not advocating for layoffs either. However, she has pushed for minor cost-savings measures, like freezing overtime for department heads, that could result in savings in the long run. She said some of the decisions are out of the hands of Council.
“It’s an unstable situation,” she said.
Cicchinelli did not immediately return a call placed to his office Friday.