Warren faces loss of revenue

By Ed Runyan

Layoffs at the two plants are not yet producing additional furloughs in Warren.

WARREN — Layoffs at the Severstal Warren steel mill and at the General Motors plants in Lordstown could reduce Warren’s water revenue by $300,000 or more in 2009.

The layoffs will also reduce the city’s income tax revenue in early 2009.

But for now, the city isn’t planning to make additional budget cuts or layoffs, said Michael O’Brien, Warren’s mayor.

There are reserve balances in the water and wastewater accounts, O’Brien said, so the loss of water and wastewater revenue from Severstal and loss of water revenue from General Motors will be absorbed for now.

“If the trend continues, we would need to look at reducing expenses, which would be personnel,” he said.

Severstal employees say about 500 to 600 of them will be on layoff through May or June, depending on the market for their products.

General Motors announced at about the same time that it would eliminate about 900 jobs as a result of eliminating the third shift at the assembly plant.

O’Brien estimates the city will see a decrease of $160,000 in water revenue between Jan. 1 and June 30 and a loss of about $140,000 in wastewater revenue during that time.

O’Brien said the city will have a better idea of how much water revenue will be lost at General Motors in February.

He said no projection of lost income tax revenue from the two facilities has yet been calculated.

The layoff announcements at both facilities came after the city had formulated its 2009 budget, which called for layoff of 40 employees — 20 of them police officers and 10 of them firefighters.

The city’s layoffs and other measures cut $3.2 million from the budget.