GIRARD State panel puts city on monthly budget

The panel lauded the city for gains last year.
By JOHN W. GOODWIN JR.
VINDICATOR TRUMBULL STAFF
GIRARD -- City leaders are going to have to budget a little differently from now on.
Members of the state Financial Planning and Supervision Commission passed an ordinance Wednesday that will require the city to operate on a month-to-month budget instead of a yearly basis. The state put the commission in place to oversee spending in the city until it comes out of fiscal emergency.
According to the resolution, the city must now establish a monthly list of expenditures and encumbrances that are consistent with a financial plan already approved by the commission. The commission must approve that monthly list.
The city, according to the resolution, must show justification to the commission should any part of the monthly budget deviate from the previously approved financial plan.
"It is really an early warning system. That is the intention of this resolution," said Paul Marshall, commission chairman.
Financial gains
The commission did congratulate the city on financial gains in 2005.
Nita Hendryx, financial supervisor assigned to the commission from the state auditor's office, said the city's general fund deficit decreased substantially during 2005. She said the city entered fiscal emergency in August 2001, with a $2.6 million deficit in all funds and has reduced that to $941,000.
Several factors played a role in the reduction, she said, including: a newly approved fire levy, revenue from gas wells, increased income tax collections and transferred interest from a lakes fund.
Marshall said the commission is often hard on city officials when it comes to reducing the city's debt, but he is happy to see progress has been made.
According to Hendryx, the city still must stay vigilant in reducing the debt. She said there are two city funds with a combined deficit of more than $503,000 that must be made whole before the city can emerge from fiscal emergency status.
Mayor James Melfi asked the commission for its assistance in devising a new recovery plan for the city to emerge from fiscal emergency. He said the new plan will have to take into account the failure of a proposed income tax increase for police services and issues involving extra funds being diverted to the Girard Municipal Court.