Welcome to the City of Lyndhurst, Ohio

Home
Affiliated Websites Directory
Agendas & Minutes
Application for Employment
City Calendar
City Council
Codified Ordinances
Community Center
Contact Us
Departments
Employee Webmail
Home Day 2017
Legislation
Live Long Lyndhurst
Local Organizations Directory
Local Places of Worship Directory
Lyndhurst Life Magazine
Maps
Meals on Wheels
News
News Archives
Newsletter Archives
Previous City Website
Properties of Distinction
Recycling Program
Search
Senior Services
Swimming Pool & Spray Park
 
Menu: Lyndhurst Life Magazine - Visit The Lyndhurst Life Magazine Section of the City of Lyndhurst, Ohio Website

Enter your email address below to have city news delivered right to your inbox.
 
Subscribe to the City of Lyndhurst, Ohio Newsletter to have current City News delivered right to your inbox:
 



AGENDAS & MINUTES / FINANCE COMMITTEE / 2012:
 
Search the City of Lyndhurst, Ohio Website.
 
Subscribe to the City of Lyndhurst, Ohio Newsletter to have current City News delivered right to your inbox.
 
Subscribe to the City of Lyndhurst, Ohio RSS Channel here, or by adding lyndhurst-oh.com/feed.xml to your preferred news aggregator.
 
Subscribe to the City of Lyndhurst, Ohio YouTube Channel at YouTube.com/CityOfLyndhurstOhio.
 
Like us on Facebook to begin receiving City News updates as part of your Facebook News Feed. Connect with us on Facebook at Facebook.com/CityOfLyndhurstOhio.

 Meetings Convened in Decenber 2012:

December 17, 2012: Finance Committee
AGENDA:

 
The Finance Committee will meet on Monday, December 17, 2012 at 6:00 P.M. to further discuss the Tax Credit/Tax Rate issue.
 
Patrick A. Ward, Chairman
Finance Committee
 
December 17, 2012: Finance Committee
MINUTES:

 
The Finance Committee met Monday, December 17, 2012 at 6:00 p.m. Present were Council members Frey, LoPresti, Marko, Packard, Schlessel and Ward. Also present were, Mayor Cicero, Finance Director Kovalchik and Chief Carroll. The purpose of the meeting was to continue discussion on the topic of the Income Tax Credit/Income Tax Rate Issue.
 
Chairman Ward opened the meeting with a description of Committee members' activities since the last Council meeting. As had been stated at that Council meeting of December 3rd Chairman Ward had once again reached out to all members of the Committee, individually, as to their questions or suggestions on potential program cuts to meet all or part of the $1.6 million budget hole the City is facing largely due to state funding cuts and elimination of estate tax. Committee members, who had peppered the Finance Director, Department Heads and the Chairman with questions, volunteered to pair up in order to provide a more focused review of Departmental operations in order to identify the impact of suggested cuts, look at operations to find other services that might be cut and so on.
 
Mr. Ward complimented those Committee members who had shouldered this important undertaking as well as the Departments that had provided them needed information. The task was to look at things from Council's understanding of the services provided, who would be impacted by any changes to those services and then what cuts to those specific services Council would see acceptable. The review of the services and the clear understanding of the services is the only foundation for any discussion of funding as Council provides the ultimate decision on the both the services to its residents and the funding necessary to provide those services.
 
Mr. LoPresti had paired with Mr. Schlessel to review Police operations and with Mr. Marko to review Fire. Mr. LoPresti offered that both departments have been operating at minimum staffing levels for some time. Fire has changed uniforms, delayed re-hires, operated willingly below the minimum staffing levels provided by contract, managed overtime, deferred large capital purchases (one year actually at ZERO), reduced education costs by doing more in-house and on-shift, applied for many grants and have looked for a "regional approach" to services. The Police Department has managed with injuries and illness, are down 3 full-time positions, reduced 1 rank (with 1 less lieutenant position to allow for 1additional sergeant position in changes recommended by Council some time ago), have been operating with only 3 members in the Detective Bureau, 1 less school resource officer fewer clerks and so on. Mr. Marko and Mr. Schlesssel added their perspectives to the discussion highlighting some of the impacts that might be suffered with further cuts; delays in critical emergency services, potential loss in revenue from billable services, increased potential for employee risk and injury and the potential inability to respond to residents' needs. The necessary level of response, even to traffic stops, was also discussed as very often it is necessary to have multiple units responding to a stop or to a call.
 
Mr. Frey and Mr. Packard had reviewed operations in the Service, Building and Finance Departments and noted the reductions in personnel in each. The Building Department operates with 2 inspectors, 1 clerk and the Commissioner to handle all permits, inspections, rental property registrations and renewals, the sidewalk program, grass and nuisance notifications, grant administration as well as the support of the City Planning, Board of Zoning and Architectural Boards among other things. No part-time help has been used for some time. The Finance Department has reduced staff greatly (beginning many years ago) and has all positions multi-tasking to optimize efficiencies. The Service Department has revamped numerous tasks, trimmed personnel and continues to look for operational and cooperative economies. Mr. Packard had spent a great deal of time with Mr. Glady and agreed that things seemed to be running very efficiently.
 
Mayor Cicero commended the Committee members on their review. He stated that whatever Council decides, the Administration and departments will work with. He identified options that would enable the Administration to absorb the reductions in revenue but indicated those cuts (3 FF/3 PD/ All part-time) would reach deeply into essential services and would put the City into a "reactive" mode from the "responsive" mode our residents are accustomed to. Along with reductions in essential Police and Fire personnel an assessment for garbage service, at about $125 per year, would be required, but it is possible to do. While raising taxes is not what he wants to, do dollars have been stretched almost as far as they can be and replacing the lost revenue is the only way to fund the Lyndhurst we know.
 
With no further business to discuss the meeting adjourned at 6:45 pm.
 
Respectfully submitted,
 
Patrick A. Ward
Chairman

Print    Back To Top

 Meetings Convened in November 2012:

November 19, 2012: Finance Committee
AGENDA:

 
To Be Posted
 
November 19, 2012: Finance Committee
MINUTES:

 
The Finance Committee met Monday, November 19, 2012 at 6:45 p.m. Present were Council members Frey, Gambatese, LoPresti, Marko, Packard, Schlessel and Ward. Also present were, Mayor Cicero, Finance Director Kovalchik, Law Director Murphy, Chief Carroll and Chief Porrello. The purpose of the meeting was to continue discussion on the topic of the Income Tax Credit/Income Tax Rate Issue.
 
Mrs. Kovalchik presented illustrations of the impact the two scenarios that had not been eliminated from discussion at the last meeting. She mentioned the "Fiscal Cliff" and reiterated the benefit of the smart and sometimes difficult decisions that had been made by Council over the past several years. She indicated that the discussions, thus far, had focused on the impact of State actions on the City's General Fund resources and she pointed out the risks to our Capital Funds that will be sustained with the elimination of Estate Tax revenue in future years.
 
In walking the Committee through the two illustrations (1.75% tax rate with a .50% credit or 2% tax rate with a .50% credit) Mrs. Kovalchik described some of the assumptions used to forecast future revenues and costs - such as more Clinic jobs, employee contractual raises, possible increase in property values at the next full re-evaluation and so on. She stated that industry professionals (GFOA) would recommend we target a $1.1 million unencumbered carryover balance at the end of each year in order to provide for a Temporary Appropriation to fund operations moving into the next year.
 
Mr. Gambatese asked if Mrs. Kovalchik could provide a snapshot of what filling the shortfall if the 1.75% plan were pursued - weighted across the various City Departments - which she promptly presented for the Committee to pass around to review. The impacts, especially to safety services would be substantial.
 
Other questions were asked and comments offered. Mr. Ward reminded Committee members that he has requested, repeatedly, suggestions as to alternative options the City could pursue in order to meet the financial need. No program cuts or other alternative courses of action, outside of the two options have yet been offered. With time permitting comments were taken from residents in the audience.
 
With no further business to discuss the meeting adjourned at 7:31 pm.
 
Respectfully submitted,
 
Patrick A. Ward
Chairman

Print    Back To Top

November 5, 2012: Finance Committee
AGENDA:

 
The Finance Committee will meet on Monday, November 5, 2012 at 6:30 p.m. to further discuss the Tax Credit/Tax Rate issue.
 
Patrick A. Ward, Chairman
Finance Committee
 
November 5, 2012: Finance Committee
MINUTES:

 
The Finance Committee met Monday, November 5, 2012 at 6:30 p.m. Present were Council members Frey, Gambatese, LoPresti, Marko, Packard, Schlessel and Ward. Also present were, Mayor Cicero, Finance Director Kovalchik, Law Director Murphy, Chief Carroll and Chief Porrello. The purpose of the meeting was to continue discussion on the topic of the Income Tax Credit/Income Tax Rate Issue.
 
Mr. Ward opened the meeting with an outline of the process that brought the Committee to this point in the discussion. The Mayor/Administration brought the issue of the impact State actions will have on the City's financial resources and suggested to Council a course of action - that is the Mayor/Administration's job. Council has taken the discussion of the problem and, over the course of several meetings has settled upon a number of options to address it - that is Council's job. Mr. Ward further clarified the "taxpayer" numbers provided by RITA for the last meeting indicating it was later learned those numbers represented individual W-2's filed not individual persons as some file multiple W-2's.
 
The Committee has reviewed the number of initiatives that have been undertaken over the past 7 years to change operations and cut costs, the contribution and participation of the employees in the process and the cooperation that has dictated this success. Were it not for these changes the City's finances, tax rate and tax credit would have been a needed conversation many years ago.
 
The City's Income Tax Rate and Tax Credit have a well-documented history. Councils past have cut back the credit, when necessary and restored it when they were able. The voters have responded to the need to fund the essential services provided by raising the Income Tax Rate. Prudent management and careful planning have stretched the City Taxpayers' dollars.
 
Mr. Ward complimented those residents who have attended the meetings pointing out that Mr. Bill Ritz was quoted in the minutes of meetings held in the mid-1980's and applauded his commitment to being well informed. Mr. Ward indicated the Committee had progressed a long way from its first discussions on this subject. What the Committee has learned is that there is total agreement on the fact the City will need additional revenue to fill the hole created by state actions; the Committee would like a balanced approach that spreads the burden between residents and non-residents alike and that the Community wants Council to be transparent in everything it does relative to this issue.
 
Mrs. Kovalchik distributed a copy of the Tax Rate Scenario sheet requested. At the last meeting Committee members had narrowed the list of options to be considered to five (A,B,C,D,E) and one for reference (F). Mr. Ward asked which, if any, Committee members would suggest be eliminated from consideration and suggested option "A" (1.5% with a 0% credit) be eliminated. All were in agreement. It was suggested by Mr. Frey that option "C" (1.75% with a .25% credit) be eliminated and by Mr. Marko that option "E" (2% with a .75% credit) be eliminated - all agreed.
 
Mr. Frey suggested the Committee recommend option "B" (1.75% tax rate with a .50% credit) be recommended to Council. Mr. Ward suggested that option "D" (2% tax rate with a .50% credit) be recommended. Option "B" would provide the City and estimated $1,130,000 in revenue and Option "D" would provide an estimated $2,000,000. Option "B" would place an added burden of $668,960 on residents and $380,765 on non-residents while Option "D" would place an added burden of $900,847 on residents with non-residents carrying an added $981,025. Mr. Marko was concerned that whichever option moves forward be sufficient to serve the needs of the residents.
 
Committee members weighed in on the discussion with Mr. Frey and Mr. Gambatese favoring Option "B" and Mr. LoPresti, Mr. Marko, Mr. Packard, Mr. Schlessel and Mr. Ward favoring Option "D". As Option "D" was selected by the majority of the Committee's members, Mr. Ward distributed a revised Ordinance 2012-79 that had been prepared by the Law Director for the last meeting and updated earlier this evening. The Legislation would provide for an elimination of the .50% Tax Credit EFFECTIVE July 1, 2013 but would NOT take effect if the voters support an increase in the Income Tax Rate prior to that July 1st date. Mr. Ward indicated the Ordinance addressed the concerns brought forward by the Committee members and the public - it provides the needed funds, it provides the transparency requested by the public and it spreads the burden fairly between residents and non-residents.
 
Mr. Gambatese indicated "we have not publicized the discussions enough to where people know what is going on". Mr. Schlessel stated these meetings have been well documented and announced as all meetings are and that the Brainard Pool discussions, that were publicized the same way, "packed the room for multiple meetings". Mr. Ward indicated the proposed legislation, if recommended, would be on Council's Agenda for 3 readings and had already been the subject of 5 Committee meetings so there was past opportunity and ample future opportunity for the public to become informed and involved as well. He further indicated Council would have to undertake the task of communicating with the public if there was any hope of gaining support for any issue put on a ballot.
 
Mr. Gambatese indicated he did not like the language in Section 2 which would eliminate the Credit if there is no tax increase. Mr. Ward stated that the Ordinance, and that section specifically, was crafted to assure Council was extremely transparent about what the need was, what the public would be asked to support and what would happen as transparency was one of the key things the Committee had been asked to address. Mr. Ward further stated that every member had agreed there was a need for the additional funds and that a plan would need to be adopted to address it. He asked Mr. Gambatese to explain what the Committee was trying to address to which Mr. Gambatese replied, "a problem not of our making". Mr. Ward further indicated the proposed Ordinance and outlined steps were decided specifically to address what had been requested as a result of the previous four meetings' discussions.
 
Mr. Murphy explained the steps that would follow should Council determine it necessary to place the question of an Income Tax Increase on the Ballot. Mr. Ward stated it would be likely that the next opportunity to have that question before the voters would be May. Mr. Murphy further stated, should the Committee move to place the Ordinance on Council's Agenda, it would be subject to three readings and could be amended should Council determine the suggested rate or credit need to be modified or if any other language would need to be changed.
 
A motion was made by Mr. Marko, seconded by Mr. LoPresti to recommend that Ordinance 2012-79 as prepared by the Law Director be forwarded to Council for consideration. All voted AYE with the exception of Mr. Gambatese who voted NAY.
 
With no further business to discuss the meeting adjourned at 7:58 pm.
 
Respectfully submitted,
 
Patrick A. Ward
Chairman

Print    Back To Top

 Meetings Convened in October 2012:

October 15, 2012: Finance Committee
AGENDA:

 
The Finance Committee will meet on Monday, October 15, 2012 at 7:00 p.m. to further discuss the Tax Credit/Tax Rate issue.
 
Patrick A. Ward, Chairman
Finance Committee
 
October 15, 2012: Finance Committee
MINUTES:

 
The Finance Committee met Monday, October 15, 2012 at 7:00 p.m. Present were Council members Frey, Gambatese, LoPresti, Marko, Packard, Schlessel and Ward. Also present were, Mayor Cicero, Finance Director Kovalchik, Law Director Murphy, Chief Carroll and Chief Porrello. The purpose of the meeting was to continue discussion on the topic of the Income Tax Credit/Income Tax Rate Issue.
 
Finance Director Kovalchik distributed a "Tax Rate Scenario Chart" for discussion purposes showing the impact of a variety of approaches, eliminating the Income Tax credit, raising the Income Tax rate or combinations of the two. She explained that the chart was not yet complete as the data for one of the requested scenarios had not come over from RITA and that their formulas and ours were not agreeing. She will provide the Committee with updated charts once all of the data from RITA has been received and she is certain the formulas are correct. She indicated that, according to RITA, there are a total of 11,563 Lyndhurst taxpayers; 9,424 work outside Lyndhurst and 2,139 work and live in the City. Of the 9,424; the largest number work in Cities with a 2% tax rate. The average salary is just under $50,000.**
 
In response to Mr. Ward's question Mrs. Kovalchik explained that, should Council do nothing until June, the City would not collect $456,000 that would be collected if the .50 Credit was suspended effective January 1st. In answer to a question, she replied that the credit could be eliminated retroactively; however, it is a scenario that RITA highly discourages. Mr. Ward stated that eliminating the credit retroactively, since we are discussing it now would simply make Council look bad.
 
Mr. Ward directed the Committee's attention to the two pieces of Legislation that Mr. Murphy had prepared in DRAFT form for review. He explained that the first, numbered 2012-78 would eliminate Section 791.26 of the Codified Ordinances. This section is a moot point as it is not applied in practice currently. It would provide a .25 credit to a person from a contiguous community who works in Lyndhurst but, because of the number of detailed qualifying conditions it is unlikely RITA could even figure out a person's eligibility to receive that credit. Mr. Murphy, Mrs. Kovalchik and RITA recommend eliminating the section.
 
The second piece of DRAFT legislation, numbered 2012-79, deals with the Income Tax Credit as found in Section 791.27 of the Codified Ordinances. Mr. Ward indicated that prior Councils had adjusted and restored the Income Tax Credit back in the mid 1980's, as needed, and asked Mr. Murphy if it wouldn't be possible to word a current Ordinance in the same way as the legislation used at that time. Mr. Murphy indicated that it would be possible. Mr. Ward stated he liked how the section of the Codified Ordinances memorialized the actions of previous Councils. Mr. Murphy indicated the section would reflect the current or recent actions but the prior actions of Councils past could be memorialized in the "Whereas" clauses of any current Ordinance in order to assure it is preserved.
 
Mr. Ward asked the Committee members if there were any of the Tax Rate Scenarios they would like Mrs. Kovalchik to eliminate from further discussion. It was suggested that the 1.50% Rate with a 25% Credit, the 1.75% Rate with a 25% Credit, the 1.95% Rate with a 50% Credit, the 2% Rate with a 100% Credit and the 2.5% Rate with a 100% Credit be eliminated from the Chart. The 2.45% with a 100% Credit will be retained on the Chart for illustration purposes. Mr. LoPresti asked the items on the Chart be numbered or lettered so the scenarios can be easily matched with the impact chart. Mrs. Kovalchik indicated that it would be done.
 
In answer to a question posed by resident Richard Clark at a previous meeting Mrs. Kovalchik stated the City is ranked 4, for insurance purposes on an ISO Rating scale. A ranking of 4 is very, very respectable. As to what might happen to a homeowner's own insurance policy should the City's ranking fall, as Mr. Clark had asked, she indicated that the ranking is made up of a number of factors; staffing, equipment, training, the City's Bond Rating and so on. In the Homeowner Insurance market, however, different companies use different formulas - for instance, State Farm has their own ranking system - so Mr. Clark would need to check with his Insurance Carrier to find out if there would be an impact should the City be forced to cut staff and so on.
 
Mr. Ward allowed a few more audience questions/comments as time allowed.
 
With no further business to discuss the meeting adjourned at 7:58 pm.
 
Respectfully submitted,
 
Patrick A. Ward
Chairman

Print    Back To Top

October 9, 2012: Finance Committee
AGENDA:

 
The Finance Committee will meet on Tuesday, October 9, 2012 at 6:15 p.m. to further discuss the Tax Credit/Tax Rate issue.
 
Patrick A. Ward, Chairman
Finance Committee
 
October 9, 2012: Finance Committee
MINUTES:

 
The Finance Committee met Tuesday, October 9, 2012 at 6:15 p.m. Present were Council members Frey, Gambatese, LoPresti, Packard, Schlessel and Ward. Also present were, Mayor Cicero and Finance Director Kovalchik. The purpose of the meeting was to continue discussion on the topic of the Income Tax Credit/Income Tax Rate Issue.
 
Chairman Ward opened the discussion by enumerating the many changes to programs and operations this Council and the Administration have enacted, especially since 2007. These include the Early Retirement Incentive Program, Automated Recycling, Automated Trash Collection, Replacing Brainard Pool with a Splash Park, EMS and MVA Billings, SELREC, Animal Warden outsourcing, School Crossing and Park Guard changes, Boards and Commissions stipend changes, Tree Program Assessment, grants, RITA Subpoena Program, Rental and Foreclosure registrations and more. We also have received help from our employees with (2) year contract extensions and our yearly medical benefits review which has save the City greatly. All of these initiatives have cut over $1.2 million in yearly expense from our budgets. Without this hard work, on everyone's part, we would have been forced to visit the Income Tax topic several years ago.
 
Chairman Ward then asked Finance Director Kovalchik to explain the "Hole" the City is facing due specifically to cuts the State has made. Mrs. Kovalchik explained that the loss of Estate Tax revenue, which will not be assessed after December 31st, along with lower Local Government Assistance, which is impacting our schools as well, when coupled with lower property values will impact the City to the tune of $1.67 million per year. She stated that by 2015 the City will be looking at a negative carry-forward balance of over $1.6 million. She said that currently Income Tax is showing well ahead of last year but one large payer has filed an estimate from which a sizeable refund may end up being due once returns are filed. In any event Income Tax revenue continues to be healthy. She has also figured in added personnel at the Cleveland Clinic Lyndhurst Campus as per the Clinic's representations.
 
Mr. Ward sated the options to fill the "hole" are layoffs, further program cuts or eliminations, increasing our Income Tax Rate or adjusting the Income Tax Credit. Mr. Frey had asked, at a previous meeting, if it would be possible to illustrate the loss of revenue against our budget. Mrs. Kovalchik prepared an illustration, for discussion purposes only, showing the impact of $1.67 million dollars in cuts spread evenly across our departments. The changes to essential services alone were sobering to see on paper. Mr. Gambatese had asked if Mrs. Kovalchik could provide a chart of the various Income tax scenarios that had been talked about. All members were provided a chart illustrating the impact of eliminating the Tax Credit which was distributed for review. Mr. Gambatese stated that there was no question that additional money is needed and the chart provided is very helpful indicating the options we have. Members asked numerous questions about the different tax rate/credit combinations.
 
Mr. Ward suggested one approach would be to reduce the credit to 25% for now and put a rate increase question on the ballot next year. Mr. Schlessel indicated it would not be wise to approach the matter piecemeal and revisiting it over and over again. Mr. Gambatese indicated he would be in favor of an approach that shares the burden between residents and non-residents who work in the City. Mr. Packard and Mr. LoPresti were in favor of getting additional resident input.
 
Mr. Ward opened the discussion to the residents present. Mr. Richard Clark questioned the impact that potential cuts to the safety forces would have upon his homeowner's insurance rates. Mr. Ward stated that the City is rated on numerous criteria including personnel, equipment and so on. Mrs. Kovalchik indicated that it was a very good question and she would see if there might be any data available to provide a more definitive answer. Dr. Salerno, a resident and business owner indicated he would prefer Council opt for an approach that balances the burden over residents and non-residents as that would seem fair. He said that, since many Lyndhurst businesses are small operations that are attracted to the location and the traffic along our main arteries they would not be looking at the City's tax rate as a primary deciding factor if looking to locate, stay or expand in Lyndhurst. Mr. Dennis Kane indicated that he learned a lot from the meeting and that Council needed to be sure to clearly communicate who will be impacted and how they will be impacted by any decision that is made.
 
Mr. Ward stated that he will ask the Director of Law to draw up legislation rescinding the tax credit for the Committee to review prior to the next Council meeting. The Committee can review the legislation at its next meeting, 7pm on October 15, and decide whether to recommend Council's consideration or suggest an alternate approach. Mrs. Kovalchik will prepare additional illustrations on two scenarios; rescinding the full credit now, placing a tax increase question on a May ballot to 2% with a .50% credit or a combination of the two.
 
With no further business to discuss the meeting adjourned at 7:27 pm.
 
Respectfully submitted,
 
Patrick A. Ward
Chairman

Print    Back To Top

October 1, 2012: Finance Committee
AGENDA:

 
The Finance Committee will meet on Monday, October 1, 2012 at 7:15 P.M. to discuss the income tax credit.
 
Patrick A. Ward, Chairman
Finance Committee
 
October 1, 2012: Finance Committee
MINUTES:

 
The Finance Committee met Monday, October 1, 2012 at 7:15 p.m. Present were Council members Frey, Gambatese, LoPresti, Marko, Packard, Schlessel and Ward. Also present were, Mayor Cicero, Finance Director Kovalchik and Chief Porrello. The purpose of the meeting was to discuss how the Committee wished to approach the discussion on the topic of the Income Tax Credit.
 
Chairman Ward indicated the many ways the Council, Administration and employees have stepped up to the challenges brought forth by the economy in general and the lower property tax valuations specifically. He stated that the State's actions with regard to cutting Local Government Assistance as well as eliminating the Estate Tax have created another challenge that will severely impact Lyndhurst and all cities across the State. That impact, when added to the funds the States has also withheld from our School Districts, is pushing an unreasonable burden upon local taxpayers. Essentially the State has balanced its budget and bolstered its $860+ million "Rainy Day Fund" by keeping more of our local tax dollars for themselves and ignoring the needs of local government that is directly serving residents and local schools that are trying to prepare our youth for the future.
 
With the possibility of any development on Acacia Country Club land off the table there is no foreseeable relief for the City of Lyndhurst or the SEL Schools from enhanced property values or income taxes that would have occurred with development - which means there is no relief for the Lyndhurst taxpayer in this regard. For the City, one option on the table is to consider reducing or eliminating the Income Tax Credit. Mr. Ward asked the Committee Members what information they might need to see in order to assist them in this discussion.
 
Mr. Marko asked about another item that has surfaced in discussions at the State level regarding the "Income Tax Uniformity Issue" which would further decimate local governments across the State. The topic has been traveling the halls of the Ohio House - although many of our Representatives seem oblivious to it - and essentially is a concept that would look to either enable a uniform reporting format for employers across the state or would somehow make local income tax uniform across the state; the exact purpose of the discussions are unclear. Mayor Cicero participates on a Task Force, as part of the Mayors and City Managers Association, which is attempting to assure our representatives are aware of the impacts local governments will face at the hands of another irresponsible change. Mr. Ward added; "the local tax rates and local tax credits have been adopted by local voters in processes prescribed by State Law which the State now wants to somehow circumvent??? It is a concept that makes no sense." Mrs. Kovalchik indicated that the CPA's were also promoting the changes because the current tax laws and rates make it "difficult for them to follow". She further stated the impact of those changes is unknown because the Representatives don't know what the changes might even be.
 
Mr. Frey asked if it would be possible to see the loss of estate tax and Local Government Assistance against a proposed budget. Mr. Ward indicated that would certainly be possible but would not be as definitive as it would be after the end of the year when we know exactly how much money we are carrying forward. Mr. Frey further asked if the Committee members could be provided a link to a chart showing the tax rates and credits across the area which Mrs. Kovalchik said she would forward.
 
Mr. Gambatese asked what other options there might be to cut expenditures stating that not enough had been done and options had not been fully explored or followed through on. Mr. Ward indicated Council had done its due diligence on every suggestion brought forward and had either made those changes or dismissed them as was Council's wish at the time. Mr. Ward reminded the Committee members that Council's role was to provide the Administration with the direction and funding necessary in order to provide the programs and services that Council deems appropriate for our residents. Once that program description and funding is in place then, and only then, may the Administration move forward with its charge to implement those programs, staff and equip them as needed. In the past several years Council has made numerous choices that have trimmed, modified or suspended programs in response to financial realities. Council has also reinstated programs because acute need has been demonstrated as well. Mr. Ward cited the Sidewalk and Tree programs as examples.
 
Mr. Gambatese referenced the Estate Tax impact and indicated "we knew this was coming for two years". Mr. Ward responded that "we have never used aggressive estate tax numbers in our budget discussions since the estate tax revenue was always an unpredictable figure. Mrs. Kovalchik has only ever presented Council with a conservative figure for those budget discussions - numbers generally representing what was already known to be available to be advanced to Lyndhurst by the County". While Estate Tax has helped bolster the City's carry-forward end of year balance it has not been an optimistic component of the budget process, however, those funds have helped keep us afloat against the other economic challenges we have been faced with. If we had not been making the tough choices, changes and decisions all along we would have been forced to have this tax discussion a very long time ago and for much different reasons than to step up to the mandates being meted down by state government.
 
Mr. Gambatese also asked about re-opening contract negotiations to cut wages. Mr. Schlessel responded contracts had just been signed with all of the employee groups for three years. Mr. Ward added that the employees played a huge role in helping the City step up to the economic challenges when they extended their contracts for two years without changes or increases. Their willingness to work with the City for the sake of the organization's well-being, along with all of the other initiatives the City Administration and Council have put forth have helped the City's financial position and have given all of us a great deal of credibility with the residents.
 
Mr. Schlessel pointed out that 87% of the City's budget is made up of personnel costs which only leaves 13% being spent on paper clips and such. Since we have already found - and continue to look for daily - just about every economy possible on our "paper clip" expenses any changes we would need to make, in order to fill the hole the State is creating for us will mean seriously cutting services or programs. Putting it bluntly, he asked and repeated several times, "who do you want to lay off?".
 
Mayor Cicero indicated the Committee was spending an extreme amount of time addressing matters that had long been put to rest and should not be focused on the questions or comments of one member but should be affording time to all present to put constructive ideas on the table. Mr. LoPresti felt that the Administration and Council had been diligent in their efforts to maintain the high level of service that we desire for the least amount possible.
 
Following some additional comments Finance Director Kovalchik indicated very strongly that "time is of the essence in this matter". She was asked to gather additional information to assist the Committee members in their further discussion of the Tax Credit issue. The Committee will reconvene with that information in hand to discuss the matter further in an effort to come to some consensus so that legislation can be put forward.
 
The Finance Committee will convene at a later date to consider the tax credit question. With no further business to discuss, the meeting adjourned at 8:00 p.m.
 
Respectfully Submitted,
 
Patrick A. Ward. Chairman

Print    Back To Top

 Meetings Convened in September 2012:

September 19, 2012: Finance Committee
AGENDA:

 
The Finance Committee met Wednesday September 19, 2010 at 7:27 p.m. Present were Council members Frey, Gambatese, LoPresti, Marko, Packard, Schlessel and Ward. Also present were, Mayor Cicero, Finance Director Kovalchik, Law Director Murphy, and Chief Porrello. The purpose of the meeting was to discuss current and 2013 budget issues.
 
Finance Director Kovalchik distributed graphs depicting General Fund Revenue Historical Data, General Fund Revenue vs. Expenditures Historical Data and General Fund Cash Balance carry forward (both with and without Estate Tax figured in) historical data looking back over 10 years.
 
Mrs. Kovalchik bulleted many of the cost-saving and revenue generating initiatives the City Administration and this Council have undertaken over the past several years and the role those actions have played in keeping our funds healthy in spite of anemic revenue growth. She further enumerated some of the significant challenges that have and will continue to impact the health of our various funds - especially the General Fund and the Capital Reserve Fund - for the foreseeable future.
 
As of today we can estimate us taking a $1.2 million hit at the hands of the economy - which has eaten away at our property values - and especially at the hands of the numerous changes the state has made with lowering Local Government Assistance, eliminating the Estate Tax and so on along with others under consideration. These actions by the State have severely impacted our City, our neighbors, our school district and those across the state. This all translates into a greater burden that will be borne by average taxpayers without question.
 
While the changes that we have initiated in our own operations, and with the cooperation and assistance of our employees, have carried us forward they cannot fill the hole that the economy and the state have presented us. With Acacia Country Club land apparently being sold to a conservancy, a non-profit organization that will pay no property tax, that has no plans or intention to develop the land there will be a loss of property tax revenue currently received and no potential for income in the future.
 
Mayor Cicero recommended Council consider eliminating the income tax credit in order to make up some of the lost revenue and to keep City services at a level our residents are accustomed to. Mrs. Kovalchik presented some figures that a variety of actions would generate but there is clearly more study required in that regard. A spirited discussion ensued.
 
A question was raised as to whether eliminating the tax credit would be a "band aid" but it would be a steady source of revenue (even though Council could reinstate the credit at a later date should things improve). A question was raised as to whether we "have done enough" to trim operations and the Mayor replied that it is something the Administration asks every single day. A question was raised as to whether the Finance Department could present Council with a variety of "Budget Scenarios" for consideration as had been done one time several years ago at the behest of a previous Council. Chairman Ward indicated that will not be done, it was a fool's errand from which that previous Council made no decision because the decision had to be made for them. The Finance Department presents Council with a line item budget for consideration delineating every single department's activities from which Council can examine, deliberate and decide what funds are needed to provide the level of service to our residents that Council deems adequate. From that line-by-line breakdown, including historical references for every line, Council has more than enough information to make adjustments as it sees fit.
 
The Finance Committee will convene at a later date to consider the tax credit question.
 
With no further business to discuss, the meeting adjourned at 8:00 p.m.
 
Respectfully Submitted,
 
Patrick A. Ward.
Chairman
 
September 19, 2012: Finance Committee
MINUTES:

 
The Finance Committee met Wednesday September 19, 2010 at 7:27 p.m. Present were Council members Frey, Gambatese, LoPresti, Marko, Packard, Schlessel and Ward. Also present were, Mayor Cicero, Finance Director Kovalchik, Law Director Murphy, and Chief Porrello. The purpose of the meeting was to discuss current and 2013 budget issues.
 
Finance Director Kovalchik distributed graphs depicting General Fund Revenue Historical Data, General Fund Revenue vs. Expenditures Historical Data and General Fund Cash Balance carry forward (both with and without Estate Tax figured in) historical data looking back over 10 years.
 
Mrs. Kovalchik bulleted many of the cost-saving and revenue generating initiatives the City Administration and this Council have undertaken over the past several years and the role those actions have played in keeping our funds healthy in spite of anemic revenue growth. She further enumerated some of the significant challenges that have and will continue to impact the health of our various funds - especially the General Fund and the Capital Reserve Fund - for the foreseeable future.
 
As of today we can estimate us taking a $1.2 million hit at the hands of the economy - which has eaten away at our property values - and especially at the hands of the numerous changes the state has made with lowering Local Government Assistance, eliminating the Estate Tax and so on along with others under consideration. These actions by the State have severely impacted our City, our neighbors, our school district and those across the state. This all translates into a greater burden that will be borne by average taxpayers without question.
 
While the changes that we have initiated in our own operations, and with the cooperation and assistance of our employees, have carried us forward they cannot fill the hole that the economy and the state have presented us. With Acacia Country Club land apparently being sold to a conservancy, a non-profit organization that will pay no property tax, that has no plans or intention to develop the land there will be a loss of property tax revenue currently received and no potential for income in the future.
 
Mayor Cicero recommended Council consider eliminating the income tax credit in order to make up some of the lost revenue and to keep City services at a level our residents are accustomed to. Mrs. Kovalchik presented some figures that a variety of actions would generate but there is clearly more study required in that regard. A spirited discussion ensued.
 
A question was raised as to whether eliminating the tax credit would be a "band aid" but it would be a steady source of revenue (even though Council could reinstate the credit at a later date should things improve). A question was raised as to whether we "have done enough" to trim operations and the Mayor replied that it is something the Administration asks every single day. A question was raised as to whether the Finance Department could present Council with a variety of "Budget Scenarios" for consideration as had been done one time several years ago at the behest of a previous Council. Chairman Ward indicated that will not be done, it was a fool's errand from which that previous Council made no decision because the decision had to be made for them. The Finance Department presents Council with a line item budget for consideration delineating every single department's activities from which Council can examine, deliberate and decide what funds are needed to provide the level of service to our residents that Council deems adequate. From that line-by-line breakdown, including historical references for every line, Council has more than enough information to make adjustments as it sees fit.
 
The Finance Committee will convene at a later date to consider the tax credit question.
With no further business to discuss, the meeting adjourned at 8:00 p.m.
 
Respectfully Submitted,
 
Patrick A. Ward.
Chairman

Print    Back To Top



Return to the top of this page.
Powered by Mind Vault Solutions, Ltd.