Austintown clerk expects township to take out loan in '05 to pay bills

Trustees hired two secretaries and promoted five employees.
By IAN HILL
VINDICATOR STAFF WRITER
AUSTINTOWN -- Township Clerk Michael Kurish says he's looking forward to a day when township trustees will no longer have to take out loans to pay their bills.
When or if that day will come, however, remains uncertain.
Kurish expects that trustees will have to take out a loan at the beginning of next year so they can pay their bills while they wait for their first allocation of property tax money from the Mahoning County auditor. The county auditor allocates property taxes to local communities twice each year: in February or March, and then in August.
On Monday, township trustees are expected to appropriate $515,000 to repay one of the two loans they've taken out this year. That includes $15,000 in interest.
The township has an $11 million budget.
State and township records show that trustees took out about $1 million in loans in 2002 and $1.1 million in 2003. Kurish said the township has taken out $1 million in loans this year.
One left
All but $500,000 of those loans will be repaid as of Monday, Kurish said. He expects that trustees will be able to repay the last loan using inventory tax revenue they will receive in November or December.
Kurish noted that trustees have been using loans to pay bills "on and off" since he took office in 1996. He said interest rates for the loans typically are about 3 percent.
As of Monday, trustees will have paid about $37,627 in interest on the loans. Trustees paid $21,805 in interest on loans in 2003.
Kurish said that to avoid having to take out a loan at the beginning of a year, trustees will need to have money left over from the previous year so they can pay their bills until they receive their first property tax allocation. In the past, Kurish has predicted that the township would have a $300,000 carry-over at the end of this year.
The estimate has decreased, however, because of increased costs and a reduction in the amount of zoning permit fees the township is expected to collect this year, Kurish said. He said he remains optimistic that the township will end the year in the black, but he's not sure by how much.
Some of the $300,000 estimate was based on the assumption that the township would receive about $156,000 in zoning permit fees from the construction of the new middle school on South Raccoon Road.
But school officials said recently that because of the construction schedule for the school, they don't expect most of the fees to be paid until early next year. Kurish said township officials had assumed that because voters approved a $26 million bond issue for the school project, the school district would pay the zoning fees this year.
Trustees can try to create a larger carry-over and avoid having to take out a loan by increasing revenue and/or cutting spending. Their last major proposal to increase revenue, a 2.5-mill levy that would have allowed the township to collect $1.4 million annually for police, failed twice at the polls: first by 900 votes in November 2003 and again by 1,400 votes this March.
Trustee Bo Pritchard said he is not in favor of having trustees place a levy on the ballot next year; Trustee David Ditzler, however, said he's not sure if he has a choice but to put a levy on the ballot.
"I see the need exists right now. I think we're just prolonging the inevitable," he said.
Recent raises
Trustee Lisa Oles cited raises given to township employees as the reason for the township's financial problems.
The township's police, dispatchers, full- and part-time firefighters and road department employees received 3 percent raises under their contracts this year, and trustees are still negotiating with the unions representing secretaries and park department employees.
Oles voted to approve the contract with the part-time firefighters; the rest were approved before she took office.
She noted that the police contract expires at the end of next year, but she wouldn't speculate on whether trustees would ask police for a wage freeze in their next contract.
A large portion of the township's $11 million budget is spent on salaries and overtime.
Last year, salaries and overtime cost the township a total of $5.1 million.
Trustees noted that amount was $250,000 less than they paid in 2002, and added that they've saved money this year by not hiring replacements for four employees who recently retired: Road and parks Superintendent Michael Bertilacci; Chief Dispatcher Carole Powers; and road department employees Charles Schrum and James Lagese.
The four were paid a total of $201,375 last year.
Positions left vacant
Trustees also have not hired a replacement for Police Chief Gordon Ellis, who is deployed with the Ohio Army National Guard and was paid $62,414 last year.
In addition, trustees have not replaced three police officers who retired two years ago and two officers who are on long-term disability.
Ellis' salary, however, has since been used to rehire two police officers and seven part-time firefighters who were laid off last year to save money.
Trustees also have promoted four employees, hired a police secretary and replaced an administrative secretary.
These moves are expected to cost the township between $66,000 and $68,000 without overtime next year. Trustees also promoted a firefighter to fire inspector, but the promotion is not expected to cost the township any additional money.
"I think we're doing the best with the money that we can," Oles said.
hill@vindy.com