Girard sheds fiscal emergency and is in strong fiscal position

In the aftermath of the May 2003 Democratic primary for mayor of Girard, we opined that the reason incumbent James Melfi received such a strong vote of confidence was his suggestion days before the election that the FBI should look into the purchase of Girard and Liberty lakes and the construction of the justice center. Melfi, who was completing his first four-year term, contended that there was no official appraisal of the lakes property and no competitive bids for the center.

However, he declined to formally request the FBI investigation during the 2003 election cycle, and then let the issue drop after he began his second term in January 2004.

Nonetheless, the cloud of suspicion that has hung over the two projects for years never really dissipated. The cloud reappeared earlier this month when state Auditor David Yost announced that the city was released from fiscal emergency, which had been declared in 2001.

“This day is the culmination of more than a decade of hard work and sacrifices made by the people of Girard,” Yost said in a press release issued June 7. “It’s good to see the city rise from its fiscal troubles and come out stronger and financially stable.”

Although a state fiscal-oversight commission controlled the city’s purse strings for more than a decade, much credit must go to Melfi for making the difficult, and often, politically risky, decisions to stabilize Girard’s finances. In addition, he led the charge for the two five-year, 3-mill levies approved by voters in 2005 and 2010 and the 1.5-mill garbage-collection levy in May 2010.

The sale of timber and royalties for gas drilling also bolstered the city’s treasury.

Auditor Yost made mention of the fact that by contracting with the Regional Income Tax Agency to do its income-tax collections, city government was able to eliminate two more positions and save $100,000 a year.

The journey to fiscal stability has not been easy. Melfi took office in January 2000 and inherited a $3 million budget deficit. The city was placed in fiscal emergency on Aug. 8, 2001, after it defaulted on two Ohio Water Development loans and had deficit balances in three funds.

Lakes purchase

One of the OWD loans was used to purchase the lakes in 1995. Then Mayor Vincent Schuyler and city council agreed to pay Consumer Ohio Water its asking price of $2.51 million. By the time the loan is paid off in about three years, Girard will have shelled out $4.7 million.

What has concerned us for some time is an appraisal report from Diversified Evaluation Co. of Pittsburgh that placed the market value of the lakes property at $1.25 million.

As for the justice center, the absence of competitive bids flies in the face of proper management of public dollars and the transparency that bidding provides.

We have no doubt that some residents in Girard — the mayor even may be one of them — will suggest that release from state fiscal emergency is a time for celebration and for looking forward, not for digging up past sins of omission or commission.

However, given that the city is still paying for those sins, taxpayers have a right to an objective answer to the question, “What went on with the purchase of the lakes and the construction of the justice center?”