YOUNGSTOWN County avoids fiscal watch

The situation will be reviewed again in the middle of next year, Jim Petro said.
By BOB JACKSON
VINDICATOR COURTHOUSE REPORTER
YOUNGSTOWN -- There will be no fiscal watch for Mahoning County just now, but that could change next year if the county's financial fortunes continue to deteriorate.
County commissioners had asked Ohio Auditor Jim Petro last month to begin the process of declaring a fiscal watch here, based on conditions that, had they not changed, could have resulted in a nearly $10 million deficit by the end of 2003.
But commissioners passed a balanced 2003 budget last week, which evaporated the projected deficit. The $47.6 million budget is about $10 million less than the 2002 budget.
County officials have blamed the sluggish local and national economy for the reduction.
Until recently, fiscal watch could be declared only at the end of a year, when actual revenue and expense figures were available. The law has changed, however, and the financial condition now can be based on projected amounts.
"While I appreciate the forward-looking approach on the county's part in anticipating fiscal difficulties, I believe an analysis by my office at this time would be premature," Petro said in a letter to commissioners.
Advice
He wrote that since the county recognizes the possibility of a significant deficit, addressing it now is the right thing to do. He advised all county officials to examine their budgets for savings.
Recommendations in a January 2002 performance audit of county government can "provide a road map" for achieving that goal, Petro's letter says.
The performance audit, which was requested and paid for by commissioners, recommended nearly 210 ways in which the county could implement cost-saving measures within the general fund to the tune of about $2.7 million a year.
About half that amount, though, would depend on changes being negotiated into union contracts.
Petro said in his letter that his office will continue monitoring the county's financial situation and reassess the situation in mid-2003.
"Until then, I feel it is far too early for such an assessment when significant action can be taken by county officials to direct and protect their own financial future," Petro wrote.
County's efforts
Elizabeth Sublette, county budget director, said department heads were told to cut their budgets by 20 percent for next year and live within those amounts. Most offices complied, but some have asked for more money.
At least two judges -- Timothy P. Maloney of probate court and Theresa Dellick of juvenile court -- have submitted entries ordering commissioners to provide them with more funding. Judge Dellick wants about $2.3 million more than commissioners have allocated her court, and Judge Maloney is seeking about $172,200 more than he was budgeted.
If those court orders hold up and commissioners are forced to come up with the additional funding, the county probably would be driven into a deficit situation, Sublette said.
"We agree that a review in six months is necessary," said county administrator Gary Kubic. "The commissioners' ability to manage a budget in the face of these court orders will be difficult to say the least."
Commissioners have said that nearly 60 percent of the county's general fund revenue is driven by the economy. County sales taxes bring in about 50 percent of the revenue, with investment earnings accounting for nearly 10 percent.
A slowdown in the economy, however, has resulted in a flat-lining of sales tax revenue and caused interest on investments to nose-dive, county officials said.
bjackson@vindy.com