Commission OKs Niles revovery plan but warns city to clean up its act

March 18, 2016 at 12:06a.m.

NILES

The commission overseeing the city’s efforts to get out from under fiscal emergency unanimously approved the latest financial-recovery plan Thursday.

But at the same time, it heard warnings that Niles has yet to clean up its act when it comes to reducing spending.

“As far as I’ve seen, nothing has been done to adjust the way money is spent other than layoffs,” said Tim Lintner, one of the two state-appointed financial supervisors who noted that Niles overspent more than $14 million in eight years leading to its fiscal-emergency status.

The amended plan put together by Mayor Thomas Scarnecchia is designed to keep the budget balanced as required by state law. Voter approval of a 0.5 percent income-tax increase this week will assure an estimated $2 million by 2017 for the safety forces, but the revenue could not be included in Scarnecchia’s plan. Lintner said that the administration has yet to produce a plan for capital spending and improvements – especially when emergency situations arise.

“If something breaks in the city of Niles, there is no money to fix it,” Lintner warned. “Things are going to break, and you need money to fix things.”

During Wednesday’s council meeting, Robert Marino, council president and commission member, voiced a similar sentiment and called for a detailed spending plan to be put together by the administration. Scarnecchia is in the hospital and did not attend the council and commission meetings but is expected to be back at his desk “in a day or two,” according to Service Director James DePasquale.

Nita Hendryx, the city’s other financial supervisor, cited findings in the state’s 2014 performance audit of Niles, which noted that employees do not pay contributions for health coverage and life insurance, while the city also picks up the tab for retirement incentives and vacation sellbacks. The benefits had been granted through labor negotiations and would have to be eliminated or reduced through collective bargaining.

“We’ve never seen this in any place we’ve been,” Lintner and Hendryx told the commission. “Let’s see how business can be changed in the city to make it solvent.”

Despite the emphasis on controlling spending, John Davis of the commission questioned Lintner about the status of the laid-off safety forces now that the tax increase has been approved. Collections from the increased tax will not begin until August, and Lintner indicated there was no money yet for recalls. That did not satisfy Davis.

“We have to get these people back,” Davis insisted. “The people who voted for the tax expect it.”

Another matter attracting the commission’s attention was Lintner’s report that city Treasurer John Swauger failed to reconcile the checking amounts for the second- consecutive month. Scarnecchia’s recovery plan requires check reconciliation by the 15th of each month, and the lack of compliance bothered commission Chairman Quentin Potter.

“This is not something that should happen when a city is in fiscal emergency, and we will look into it if it continues,” said Potter. He declined to discuss the commission’s options should the treasurer not comply with the deadline by the panel’s next meeting April 27.

Swauger did not attend the commission meeting.