43
Youngstown officials reduce projected general-fund deficit
YOUNGSTOWN
City officials are working to balance the estimated $33 million general-fund budget that started the year with a $2.2 million deficit.
At a Wednesday city council meeting, Kyle Miasek, interim finance director, said that deficit has already been cut by $790,400.
That is the result of a $640,400 savings in medical insurance premiums for the general fund and $150,000 in an additional payment from CoreCivic, which operates the Northeast Ohio Correctional Center, a private prison on the East Side.
The city has an agreement with CoreCivic in which the company pays the municipality $300,000 annually if it has an average inmate population of at least 1,250 the previous year. But the deal calls for that payment to be cut in half if there are between 750 and 1,249 inmates, and for there to be no payment if there are fewer than 750 inmates.
In 2017, CoreCivic was in that 750-1,249 range and paid $150,000 to the city last year. But the company recently informed the city that its average inmate population last year was 1,778, meaning the city will receive the full $300,000 payment this year.
Miasek also discussed potential additional savings at the meeting.
The city could save the general fund $680,000 by not funding various equipment requests made by department heads. It would be up to council to decide what purchases wouldn’t be made.
The requests include $100,000 each for a boom mower tractor and for two crew trucks for the street department, $222,000 for a radio system for the fire department and $56,000 for a stump-cutting system for the parks and recreation department.
Also, Miasek said the city could save $18,200 if it didn’t purchase an air-conditioning system for Henry Stambaugh Golf Course’s clubhouse requested by the parks and recreation department.
But even if all of those funding requests were rejected, the general fund would still have a deficit of $711,000.
Council has to adopt a 2019 budget by March 31.
Miasek said there are a number of requests from departments that receive money from the general fund that he hasn’t vetted. He said he’ll do so in the next two weeks.
Miasek will meet again with council at 5 p.m. Feb. 7 to further discuss potential cuts to balance the general fund.
“I’ll have a much clearer figure at the next meeting,” he said.
Even if Youngstown officials successfully trim $2.2 million from the 2019 budget, the city likely would start 2020 with another $2 million deficit.
Meanwhile, the city’s board of control today plans to rehire Michael Abouserhal as a financial consultant for up to $25,000 for an interim period.
Abouserhal, who will be paid $150 an hour, will assess the city’s financial condition, evaluate the proposed 2019 budget, evaluate the long-term budgetary forecast, help with the selection of a finance director and provide advice on what the city will do regarding the possibility of having to pay about $5.5 million from its general fund for money it inappropriately spent from its water, wastewater and sanitary funds for economic-development projects.
Last year, the city hired Abouserhal, a former Ohio Lottery Commission executive director and CPA, to provide a long-term analysis of its financial situation. He said in May 2018 that if the city didn’t make significant changes to its finances, it would face a $16 million deficit by 2023.