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Commission asks state to end Niles fiscal emergency
Turnaround ‘pretty amazing,’ chairman says
By Jordan Cohen
NILES
More than four years after millions in deficit spending led to a fiscal emergency declaration from the state auditor, the fiscal commission agrees that Niles has finally righted the ship.
The Financial Planning and Supervision Commission – the state-created panel overseeing city finances since October 2014 when the declaration was issued – voted unanimously Thursday to request the state lift the fiscal emergency declaration.
“The city no longer has any deficit funds, and everything is ending in positive balances for this year and all of 2019,” Tim Lintner, one of the city’s two fiscal supervisors, told the commission before the vote on the resolution.
“Where [Niles] is today is pretty amazing,” agreed commission chairman Quentin Potter. “You have possibly achieved the last milestone ... and taken all the steps necessary.”
Those steps included development of a financial recovery plan that was revised eight times in four years, the last time shortly after Mayor Steven Mientkiewicz took office.
Lintner said one reason for the financial turnaround was the decision by then-Mayor Thomas Scarnecchia and council to hire the Regional Income Tax Agency for its income tax collections instead of relying on the treasurer’s office.
“I’m very confident with RITA,” said Treasurer Steve Telego, who was appointed earlier this year. “They have resources we never would have had.”
According to Lintner’s figures, the city set a record with more than $9.1 million collected in income taxes this year, an increase of 18 percent.
“I have to give credit to Mayor Scarnecchia for RITA even though it was wildly unpopular,” Lintner told the commission.
Scarnecchia’s response when contacted by The Vindicator: “I made some enemies, but in my heart, I knew it was the right thing to do.”
Another positive for the city is a substantial increase in revenue in the general fund and the water, light and sewer departments. Another state requirement – a citywide asset management inventory – is expected to be completed by the end of this year.
“Overall cash is up an amazing 25 percent from the beginning of the year,” Lintner reported.
Despite all the positive financial reports, Mientkiewicz said his city expects to lose $65,000 in income tax revenue when General Motors shuts down operations at the Lordstown complex by March.
“We will be fiscally cautious,” he promised his fellow commission members. Nonetheless, he said, the commission resolution “should make everybody proud.”
Under Ohio law, only the state auditor has the authority to lift fiscal emergency. That may not come until sometime in January or later after Keith Faber, elected to the position in November, assumes office. Assuming Faber agrees and lifts the declaration, the commission will meet one last time to formally dissolve.