City of Niles fiscal crisis can no longer be ducked

The recent indictment of ex-Mayor Ralph Infante of Niles and two others on government corruption and other charges overshadowed the latest revelations regarding the city’s fiscal crisis.

Mayor Thomas Scarnecchia, who ruined Infante’s re-election bid in last year’s Democratic primary, announced that “drastic cuts” in city government’s spending could no longer be avoided.

But the mayor, who has been less than decisive in dealing with the state-mandated fiscal emergency since he was sworn in at the beginning of the year, said he does not know if layoffs, a reduction in services, or both, will be needed in 2017.

Scarnecchia has five days to figure things out. He must submit an amended fiscal recovery plan to city council on Friday for approval.

The plan will then be presented to the Fiscal Planning and Supervision Commission that has controlled Niles’ finances since Ohio Auditor Dave Yost issued the emergency declaration in 2014.

“We’re going to make drastic cuts … I know this,” the mayor said during a recent meeting of council’s finance committee attended by all lawmakers.

But his admission that he wasn’t sure what form the cuts would take brought this sharp rebuke from council President Robert Marino:

“It’s very dangerous to throw comments out like that. We don’t want to cause firestorms from putting out bits and pieces of information, [which is] why we need a comprehensive plan.”

Marino must know that firestorms are inevitable, given the revenue projections for 2017.

City Treasurer Janet Rizer-Jones said income-tax collections will yield $7 million this year, instead of the anticipated $7.19 million.

City Auditor Giovanni Merlo told the finance committee that with the lower revenue and the city’s spending obligations, including repairs to the 89-year-old city hall, government could face a negative balance of $148,000 at the start of 2017.

Criticism of Infante

It’s ironic that Scarnecchia won last year’s election by blasting Infante for mismanaging the city’s finances; he pledged to demonstrate the leadership necessary to pull government out of its economic tailspin.

Scarnecchia also raised questions about Infante’s fitness to hold office, given the state investigations that were ongoing in city hall.

The 56-count indictment of Infante relates to bribery that occurred 23 years ago, unreported gifts in the hundreds of thousands of dollars, selling a city job and gambling.

Infante’s wife, Judy, and city worker Scott Shaffer also face criminal charges.

The case is being prosecuted by Ohio Attorney General Mike DeWine’s office.

While there’s no doubt that the new administration has changed the culture in city hall – Infante did not shy away from flexing his political muscle, there is a question of competence.

We endorsed Infante in last year’s primary but expressed concern about the state investigation, and then backed Scarnecchia in the general election.

However, we have been unimpressed with the way the mayor has tackled the city’s fiscal crisis. His reluctance to make the tough decisions, especially with regard to personnel, has resulted in the fiscal planning and supervision commission requiring a revised financial recovery plan that shows a balanced operating budget for five years.

Based on what has occurred over the past two years, things are not going to get better unless the mayor and council make the difficult decisions that carry great political risk.

For instance, overtime is one of the major drains on the budget.

As Tim Lintner, state appointed fiscal supervisor, said last week, overtime spending has increased in the light department from $92,000 to $175,000, while it’s up in the water department “110 percent.”

Such spending cannot be sustained because there aren’t any new sources of revenue for the general fund.

To further exacerbate the fiscal crisis, city officials still are figuring out how many of the 1,200-plus General Motors’ Lordstown plant employees who will lose their jobs in January are city residents. There will be a loss of income tax revenue.

Mayor Scarnecchia can no longer avoid doing what he was elected to do: Lead Niles out of its fiscal emergency.