City aims to trim ’09 budget by $2M to $3M
Youngstown finance director David Bozanich
Youngstown Mayor Jay Williams
YOUNGSTOWN — The city needs to cut at least $2 million to $3 million from its 2009 budget to avoid layoffs, its finance director said.
“The storm is on the horizon,” said Finance Director David Bozanich. “We need to weather 2009 by being creative and responsible. It will be a difficult period.”
Also, 2010 is going to be a “tough year” financially for the city, he told The Vindicator Wednesday after council’s finance committee met and before the lawmakers’ regular meeting.
“It’s scary out there,” Bozanich said of the economy nationwide.
This year hasn’t be easy either, Bozanich said.
The city started 2008 with the expectation that its general fund would have a deficit of more than $3 million by the end of the year and about $6 million by Dec. 31, 2009, if cuts weren’t made and revenue not found.
City administrators had said about 60 workers would be laid off if nothing was done.
With a firefighter buyout program, keeping some jobs vacant and replacing others with employees at a lower salary, as well as the sale and lease of its assets, the city reduced its costs.
The most notable cash influx was a $1.35 million lease deal the city made with Communications Capital Group LLC for cellular telephone towers at three locations.
The city’s general fund will end the year with “a slight operating surplus, and I mean slight,” Bozanich said.
The “slight surplus” is in the $100,000 range, he said. That’s a far cry from the $2.3 million surplus the general fund had at the end of 2005.
The city finds itself in this financial position primarily because of the weak economy that adversely affects the 2.75-percent tax businesses pay on profits and the decline in jobs and wages for those who pay the 2.75-percent income tax, Bozanich said.
The city will again look at the sale and lease of its assets as well as not filling vacant positions as options to reduce or eliminate the projected deficit, Bozanich said.
There are also a few economic development proposals that could bring revenue to the city, he said. The finance director declined to discuss the proposals.
While everything will be done to avoid layoffs, it always remains a possibility.
Because of the city’s long-standing financial troubles, its officials have faced this challenge before, Bozanich said.
“We’re experienced managers when it comes to dealing with difficult economic times,” he said. “In Youngstown, we went through Black Monday and an 18-percent unemployment rate.”
He was referring to the announcement in 1977 that Youngstown Sheet & Tube Co.’s Campbell Works was shutting down.
Mayor Jay Williams’ administration is putting together the 2009 budget proposal and will meet with city council shortly to discuss it, Bozanich said.
skolnick@vindy.com