Officials mull actions as projected deficit grows
By Jeff Gallatin
North Olmsted
Published June 24, 2009

City officials continue to try to find ways to cope with a projected budget deficit for 2010 which administration officials are now estimating could hit $2.4 million.

City Council President and current mayoral candidate Kevin Kennedy said the city is going to face tough decisions and said it could have to look at employee furloughs with unpaid time off for the workers or an across the board pay cut. Mayor Thomas O’Grady, who said several weeks ago the city was considering furloughs as an option, said the administration is trying to find the best ways to deal with the situation. He said much of what could be done depends on the currently ongoing contract negotiations with several employee unions.

Kennedy said there’s no easy way to deal with the issue.

“It’s going to be painful to deal with but we have to deal with the situation now,” Kennedy said. “I would look at other cities which have been more pro-active and look at items like employee furloughs or an across the board pay cut.”

O’Grady said the administration is still trying to deal with the situation but said options are becoming more limited.

“We’ve already cut a great deal and there really aren’t many other options like that,” he said. “We’ve got other ideas but they are contingent upon current discussions in contract negotiations with the employee unions. At this point, because the talks are ongoing, I can’t discuss those because of those negotiations.”

During City Council’s June 16 meeting, Kennedy asked O’Grady about administration efforts to deal with the deficit between city revenues and expenses, noting current projections place it at $2.4 million. Officials have cited decreased revenues in real estate and retail related taxes as major factors. The duo again differed verbally, with Kennedy noting he had asked O’Grady about the issue at the previous meeting and asking what the administration was doing to try and deal with the problem. O’Grady started to note his administration’s cost-cutting work the last four years, but Kennedy stopped him asking about current efforts. O’Grady ultimately reiterated that he would meet with Kennedy or any other council members to go over the situation with them.

In addition, the mayor and council members later differed on legislation pertaining to raising possible revenues. O’Grady said he was withdrawing his name from the legislation where the administration several months ago had proposed temporarily cutting the income tax credit for city residents who work outside the city. Council’s agenda had that legislation and another proposal to consider collection firms for delinquent bills for EMS squad runs up for tabling. After O’Grady said he wished to withdraw his name, council Finance Committee Chairman Michael Gareau questioned whether he could with the council ultimately voting to send them back to committee, with O’Grady questioning that move.

Later in the week, Kennedy and O’Grady said they had set up a meeting for next week to discuss the situation. He also said he would meet with city employees to try and see what they can do to help deal with the situation.

“I’ll sit down with any of the groups and discuss it with them,” he said. “We have to work with each other to find a solution.”

North Olmsted School Board member and Municipal Planning and Design Commission Chairman John Lasko, who is facing Kennedy in the general election for mayor, said when contacted he is also trying to consider ways of dealing with the problem.

“I’m aware of the issues considering the budget,” said Lasko. “I met with the mayor on Friday and in fact, the budget projections and possible ways of dealing with it is one of the issues we discussed. We have met several times and we will continue to talk about various issues. I’ve also set up meetings with other directors to discuss that and other issues relating to the city.”

Lasko said the city also needs to consider other options.

“In addition to knowing there is a projected deficit and that we could take actions such as furloughs, pay cuts and layoffs we need to consider the other side of the coin,” he said. “In addition to discussing those, I will be talking about possible measures for raising revenues through economic development and other potential measures where we can talk about increasing income and other ways of getting funds instead of cutting.”

Lasko said after he has additional information from the other meetings, he will discuss what he thinks potential actions the city can take.