Possible V&M expansion gives council air of optimism for ’09

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Youngstown finance director David Bozanich

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Youngstown Mayor Jay Williams

Youngstown’s 2009 first-quarter budget is about $25 million.

STAFF REPORT

YOUNGSTOWN — The V&M Star project isn’t a finished deal, but it “could have a huge impact on the positive side for [Youngstown’s] 2009 budget,” said city Finance Director David Bozanich.

Bozanich brought up the V&M Star project during city council’s finance meeting Tuesday.

V&M Star operates a mill in Youngstown that produces pipe for oil and gas exploration. The company said in November that it was considering a local site for a possible expansion.

This month, the state approved tax credits for the project, and Youngstown and Girard officials agreed on a plan to share income taxes created by an expansion.

The V&M project, which could potentially provide hundreds of jobs to the area, is not in the bank, but city officials are “still cautiously optimistic,” Mayor Jay Williams said.

It would be Youngstown’s largest project in 2009 and probably one of the bigger projects statewide, the mayor said.

A decision on the project is expected in late January.

The V&M Star project was one of the positive points council and city officials discussed during the finance meeting and a special meeting to discuss the closing of the 2008 budget and the adoption of the first-quarter 2009 budget of about $25 million.

“This is the third year we’re ending with a surplus and in this economic environment that’s not easy,” Williams said.

The 2008 year started off with the projection of ending in a deficit, but the city is closing the year with about $500,000.

Youngstown also is ending 2008 with no city employee layoffs and it’s the hope that 2009 will yield the same results, said Williams, noting that “no guarantees” can be made.

Financial situations statewide and nationally aren’t readily improving, therefore employee cooperation is important to help maintain jobs, he said.

Other financial positives Bozanich pointed out to council members for the upcoming year included the $2.7 million in Neighborhood Stabilization money, thousands in Clean Ohio funds and also about $4.9 million in Job Ready Sites Program funds.

From the negative aspect, Bozanich also brought to the attention of council the top expenses in terms of yearly budgets, which included personnel expenses, sanitation costs, street lighting and the justice system.

Switching to LED lights for street stop signals has a significant start-up cost, but would be 60 percent to 80 percent more efficient, said Williams.

The city spends $300,000 to $400,000 a year on streetlight costs, and making the conversion to LED lights could result in a 60 percent decrease, said Charles Shasho, deputy director of public works.

These changes and other money-saving ideas were tossed around during the meeting. Council passed both the ordinance to reconcile the 2008 budget and the ordinance to adopt the 2009 quarterly budget until the annual 2009 budget is passed.

Bozanich said “2008 was a fairly tough year from a budgeting perspective,” noting that due to the general economic condition, 2009 is going to be just as difficult, if not more, in terms of finance.

The 2009 budget will be completed between the first of the year and March, the mayor added.

On a nonbudget topic, council was visited by Joe Schiavoni of Canfield, who recently replaced John Boccieri as the state senator for the 33rd District.

“I want to be here to hear your concerns,” Schiavoni told the mayor and council members. “Whatever I can do for you, I’ll give it my best shot.”

“We are looking forward to working with him,” said Williams.