Niles voters asked to increase revenue by $2 million through income tax hike

By Ed Runyan

runyan@vindy.com

NILES

It’s been a long 16 months for Niles officials, starting with the declaration by the Ohio Auditor’s Office in October 2014 that the city was in fiscal emergency because of deficit spending.

Several criminal investigations occurred that year – one that resulted in Assistant City Treasurer Phyllis Wilson’s being convicted in the spring of 2015 of stealing $142,000 from her department and a broader investigation that apparently scrutinized then-Mayor Ralph Infante, who lost in the Democratic primary in May 2015 to Tom Scarnecchia.

Another former city employee, Heidi Powell, 34, of the income-tax department, was convicted of stealing $731 and spent more than four months in prison in 2015 for it.

No criminal charges have been filed outside of the Wilson and Powell cases, but a special prosecutor was appointed in December to handle “alleged criminal activity” in Niles involving public officials.

Infante started the process of getting the city’s finances in order before leaving office at the end of the 2015, but voters were in no mood to approve the 0.25 percent income-tax increase the city asked for at the November general election.

The election also produced four new council members out of seven.

Former Councilman Thomas Scarnecchia was selected as the new mayor of Niles. Scarnecchia laid off 12 city employees Feb. 10, and city council approved his five-year financial recovery plan Feb. 23 that cut $1.5 million from the 2016 budget.

In order to get another shot at new money in 2016, Niles City Council in late November placed an even larger tax measure on the March 15 ballot – a 0.5 percent income-tax increase. It will raise about $2 million per year if approved.

Some might ask why Niles officials would expect voters to approve an even larger tax increase in March than they rejected in November.

One of the new council members, Steven Mientkiewicz, said he thinks it can be done.

“We’re trying to re-establish trust and transparency of the residents,” Mientkiewicz said. “We want to show people we can have good stewardship of their money. I’m confident in my colleagues and the admininstration.”

Mientkiewicz was one of two council members who sought deeper cuts in the recovery plan than Scarnecchia. He and veteran Councilman Steve Papalas held out for an additional $330,000 in savings through having the county 911 center handle Niles police dispatching. They were outvoted 5-2.

The financial-recovery plan was written to eliminate deficit spending regardless of whether the proposed income-tax increase is approved or not.

But officials say failure of the tax will prompt additional layoffs.

Jay Holland, acting Niles police chief, said his department has dropped from 32 officers at the start of the year to 27 now because of three layoffs and extended sick leave for Police Chief Rob Hinton and Capt. Ken Criswell.

He says an expected loss of three to four more officers if the tax fails would be “a disaster.” If that happens, it might take the city years to regain its grip on crime, Holland said.

Mientkiewicz and other city officials say they believe they are doing what’s necessary to restore confidence.

James DePasquale took over as Jan. 1 as Niles service director. “We’ve made some hard decisions,” DePasquale said, adding that the Infante administration became “a little complacent.”

“I think people defeated the tax [in November] because they said, “Why should we give them more money? What happened to the other money?’”

A second Niles tax on the ballot March 15 is the 1-mill, five-year replacement levy for Niles parks and recreation to raise $249,127 annually, which is an increase of $89,721 per year over the $159,721 the current levy provides.

Carmen Vivolo, parks director, said the additional money raised by the levy will allow the city to reduce the amount of general-fund money the city uses for parks.

The city has had a 1-mill parks and recreation levy since 1981.