BUDGETING 2003 audit shows city is in the black

The city made a $500,000 turnaround in its year-end balance in just two years.
By HAROLD GWIN
VINDICATOR SHARON BUREAU
SHARON, Pa. -- The red ink at the end of the city's fiscal year has disappeared.
An audit of Sharon's 2003 budget of $8 million showed a year-end fund balance of $215,876, said the accounting firm of Black, Bashor and Porsch of Sharon.
That's something the city hasn't seen in years.
Mayor David O. Ryan said Sharon ended 2001, the year he took office, with a deficit of $280,889.
That number dropped to a deficit of $229,523 at the end of 2002 but showed a positive result for 2003 with the $215,876 fund balance, he said.
That's a turnaround of nearly $500,000 in just two years, the mayor said.
The audit was presented to city council Wednesday, and council President Fred Hoffman said lawmakers will review it at 4:30 p.m. Tuesday with an accounting firm representative.
Getting rid of the red ink was something Ryan vowed to do when he took office.
Tight spending and a more aggressive approach to tax collection made the difference, he said.
Michael Gasparich, city finance director, said Sharon was able to collect $150,000 more in wage taxes than it had budgeted for the year.
What caused problem
Ryan said the year-end deficit he inherited in 2001 was caused by a recession that caused real estate and wage taxes to fail to materialize as expected.
It wasn't the result of any mismanagement, he said, adding that his predecessor, Robert T. Price, did a good job with the city finances. "It was just the economic conditions at the time," Ryan said.
Getting a positive fund balance wasn't the only accomplishment.
Ryan said the city rolled over $415,000 in unpaid bills from 2001 into 2002.
The rollover from 2002 to 2003 was cut to just $156,000, which is a normal bill total for one month, he said, noting that most December bills don't arrive until January.
The city also has been able to reduce the amount of money it has borrowed from its wage tax account to help finance general-fund operations.
That was at $1.1 million in 2002 but was reduced to $992,000 for 2003.
Right now, the figure is down to $686,000 for this year although it could rise by the end of the year, Gasparich said.
"It doesn't mean all our ills are cured, but we're heading in the right direction," the mayor said.
Sewer fund
The audit did note that sanitary sewer fund revenues didn't grow as anticipated after rate increases of 16 percent in 2002 and 11 percent 2003.
Revenues should have risen by $390,000 a year, but the books show an increase of only $60,000, the audit said.
Gasparich said that was caused by a number of factors, including wet spring and summer seasons that resulted in residents' using less water for things like watering lawns and gardens and washing their cars.
Water usage (upon which sewer fees are based) actually dropped in about 2,200 homes, he said.
The city may have to consider changing its rate structure to boost revenues needed for the anticipated, $17 million-$18 million in improvements to the sewage treatment plant, Gasparich said.