Mayor of Toledo presents 6 ways for city to raise revenue

3/31/2009

Toledo Mayor Carty Finkbeiner Monday presented some deep cuts and six ways for the city to collect revenue through fees and taxes - including an increase of the city's trash fee - to balance a $27.7 million budget deficit.

The mayor again is asking Toledo City Council to approve a plan that it rejected this month that would cost Toledoans employed in other locales more in income taxes by cutting the city's income tax credit in half.

That would generate about $3.6 million through year's end.

"In the fourth quarter of 2008 and continuing up to this time in 2009, the 15 percent decline in our tax collections have dramatically changed our revenues for 2009," Mr. Finkbeiner said. "This dramatic decline dictates we make immediate structural changes to the 2009 budget."

Mr. Finkbeiner on March 13 proposed laying off 75 police officers but reduced that number Monday to 40.

The mayor said council must approve his $9.28 million in "modest revenue enhancements in this emergency situation" as well as $18.43 million in cutbacks.

"One without the other will not balance - even come close to balancing - the budget," he said. "Only implementing both will stabilize this good ship Toledo."

The plan, much of which is subject to approval from council and the affected city unions includes:

•Increasing the monthly refuse fee from $7 to $10 for people who do not recycle and from $2 to $7 for those who do. That would boost city revenue by $1.9 million.•Stepping up collection of delinquent taxes, estimated to produce $1.67 million.

•Reducing the city's transfer to its capital improvement program by $800,000.

•Increasing court filings to generate $777,000.

•Generating $500,000 by billing homeowner insurance for responding to a structure fire.

•Slashing all city salaries by 10 percent, with the exception of employees in the American Federation of State, County, and Municipal Employees Local 7, the Toledo Municipal Court, and exempt workers.

•Suspending contributions to the employees' share into their state retirement pension system, which is a contractual obligation. That would save the city about $5.3 million through Dec. 31.

Excluded would be municipal court employees and Local 7 workers.

Current Local 7 employees, under a contract reached in January, have to contribute just 1.5 percent of their pay as contribution to the Ohio Public Employees Retirement System for 2009, and the city covers the remaining 8.5 percent of an individual's pension contribution. New employees into the union would pay the full 10 percent pay contribution for all three years of the contract.

•Saving $1.74 million from the 40 police layoffs.

•Cutting fire department overtime by $1.1 million, though moving more firefighters to the line.

•A 10 percent pay cut and PERS suspension for the Toledo Municipal Court employees and the elected judges.

•Subcontracting Toledo's trash collection beginning Sept. 1 to save $1 million.

•Laying off a number of AFSCME Local 2058 employees to save $718,000.

•Reducing the city's fuel budget by $500,000.

•Saving $435,992 from the already enacted 36-hour work week for exempt employees.

•Cutting $369,000 from the police department's overtime budget, training funds, and postage.

•$299,500 in savings from the approved Local 7 contract.

•Cutting the Corrections Center of Northwest Ohio budget by $175,000.

•Slashing $43,412 ear-

marked for office supplies.

The city's shortfall is driven by decreasing income tax receipts, which this year are expected to net just $145 million - the same amount collected in 1997. That figure is down from the $169 million anticipated when the budget was passed in January.

The two city union leaders present for council's meeting took umbrage with the plan.

Alan Cox, president of Local 2058, indicated it would not be fair to strip other unions of the pension contributions and 10 percent in pay while Local 7 members would not get the same reductions.

Richard Collinson, business representative for Teamsters Local 20, which represents the refuse collectors, said the union has a binding contract with the city that would does not allow for cuts.

He has advocated the city stick with its current work force rather than hire a private trash hauler.

Councilman D. Michael Collins also asked if the city had considered that Ohio law requires municipalities to continue paying pension contributions for employees replaced as a result of subcontracting.

The Finkbeiner administration has been seeking concessions from the Toledo Police Patrolman's Association, the police command officers' union, and Toledo Firefighters Local 92.

The city is in negotiations with all three.

Robert Reinbolt, the mayor's chief of staff, said the city would continue talks with its unions.

"We fully expect concessions will be required to balance the budget," he said.

Nine councilmen had arrived for a 2 p.m. meeting yesterday expecting a new 2009 general fund budget to balance a $27.7 million deficit.

But the council recessed after just 30 minutes - some fuming with disappointment that the Finkbeiner administration did not have the promised solution and instead attempted to deliver the same presentation it gave last week on how the deficit was created.

Mr. Collins interrupted City Finance Director John Sherburne, questioning why they were not getting the promised plan.

Councilman Joe McNamara asked for a five-minute recess so the mayor could come down from his 22nd-floor office, which the mayor did later in the afternoon.

Contact Ignazio Messina at:

imessina@theblade.com

or 419-724-6171.