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Niles faces fund shortfall and possible layoffs
By Jordan Cohen
NILES
City Auditor Charles Nader warned that Niles will not have enough money in the general fund to pay its employees by December, and layoffs could occur as early as November.
“If we don’t get overtime under control, there won’t be enough to meet payroll,” Nader told council Wednesday.
The financially struggling city has been in fiscal emergency since last October and under the supervision of a deficit commission, which has its next meeting Aug. 19.
Nader said that he and the board of control have told department heads only the most essential spending requests from either the city’s general fund or those departments subsidized by it will be approved.
“If they need something fixed or it’s for everyday business, that’s fine, but there’s no new this or new that,” Nader said.
Mayor Ralph Infante said he was not surprised by Nader’s assessment. “Overtime is eating our wage accounts in police and fire,” the mayor said. “The police and fire budget is $7.5 million, and we only bring in $6 million.”
The mayor said the safety forces have already exceeded the amounts budgeted for this point of the year. “Police and fire (have spent) 60 percent of their budget,” the mayor said. “They should be at 50 percent.”
Fire Chief Dave Danielson said illness or injury to three of his firefighters “is responsible for 95 percent of my overtime.” But the mayor and council members cite another reason: a “minimum manning” clause in safety forces’ contracts, which requires a specific number of personnel on duty at all times. The city is attempting to eliminate the clause in the current contract negotiations, which Infante estimates would cut expenses by $250,000 annually.
Bargaining talks “are still up in the air” according to Infante, although all five city unions agreed last week to a 10 percent co-pay of their health insurance premiums. The mayor said the city will save more than $480,000 yearly as a result.
Those savings and the elimination of minimum staffing are included in Infante’s 35-point recovery plan designed to get Niles out of fiscal emergency. Another key component is a 0.25 percent increase in the city income tax that will appear on the November ballot. If voters approve, the increase would generate $900,000 annually.
“If the income tax fails, that is going to make the pain much worse,” said Robert Marino, council president.
Nader admitted that even if overtime is significantly reduced, the city could still be in payroll trouble come December.
The mayor would not speculate on how many might be laid off. “I’ll have a better idea when I get the latest monthly figures from the state auditors,” he said. Those figures will be released at the Aug.19 commission meeting.
The mayor and Nader said they will then put a plan together that they hope will ensure the city will have enough money to meet December’s payroll and possibly avert layoffs. Their plan is to be completed by Sept. 1.