LAWRENCE COUNTY Deficit remains unclear

Commissioners are considering a hiring freeze.
By LAURE CIOFFI
VINDICATOR NEW CASTLE BUREAU
NEW CASTLE, Pa. -- With the year coming to a close, Lawrence County commissioners still don't have a clear picture of the county's total debt and how they plan to meet year-end expenses.
Commissioners met Tuesday with county Controller Mary Ann Reiter, who was unable to give commissioners more than her first estimate that the county will be $1.3 million in deficit by year's end.
She said that they expect to run out of cash by mid-November.
Lawrence County Treasurer Gary Felasco was invited to attend, but declined because his attorney was not available to be present.
Reiter noted that the county has segregated the $7.7 million needed to repay the county's tax anticipation note by year's end. But there isn't enough cash left to pay county employees after the next two payrolls, she said.
Reimbursement
Commissioner Steve Craig said they are hoping that a $750,000 reimbursement from the state for county Children and Youth Services will come in before year's end. He said that money, combined with an estimated $100,000 savings from a one-week employee layoff should get the county closer to meeting its year-end expenses.
Shortly after the deficit was announced, county department heads agreed to not spend about $400,000 budgeted for 2004.
"If it all did fall into place, the deficit would be much more manageable," he said.
Commissioner Dan Vogler suggested they meet again in a couple days to talk more about budget matters.
Commissioners also expect to talk at Thursday's caucus meeting about a proposed hiring freeze.
"We have to reduce spending by about $1 million. I don't know if we can do it," Commissioner Ed Fosnaught said.
Budget problems
County Administrator Charleen Micco said the budget problems appeared to have started in 2002 when the county moved to a new accounting system.
She said the problems compounded the following year when the county underwent reassessment. Both years, the county had to borrow money from other accounts to pay its year-end debts.
County commissioners say they again may have to borrow from other accounts to pay year-end expenses, but aren't sure they will get cooperation from the county treasurer -- who was under investigation by the Pennsylvania Auditor General's office earlier this year for borrowing money for year-end expenses from restricted accounts.
Felasco also is accused by county auditors of borrowing $1 million from county mental health/mental retardation funds in 2002 and never repaying the money.
cioffi@vindy.com