The mayor has not developed a long-term financial recovery plan -- he is awaiting recommendations from the auditors.
By TIM YOVICH
VINDICATOR TRUMBULL STAFF
GIRARD -- Results from a special state audit to determine the scope of the city's financial woes have been postponed.
Mayor James Melfi asked in April for the audit that might result in the city being placed in fiscal watch or emergency by the state. At first, Melfi indicated the audit would take only a matter of weeks.
City Auditor Sam Zirafi told members of city council's finance committee and other lawmakers Monday that state auditors want to return after the city closes its books through June.
Zirafi said the state auditors "know the [city's] sense of urgency."
Melfi suggested he was becoming disappointed the audit has not been completed by now. The mayor has not developed a long-term financial recovery plan to dig the city out of a projected debt of $1 million by year's end as he is waiting for recommendations from the state auditor.
During the committee meeting, Councilman Thomas Grumley, D-4th, and Councilwoman Kathleen O'Connell Sauline, D-2nd, urged the mayor to develop the plan without the state audit.
"We can't keep waiting," Sauline asserted.
Councilman John Moliterno, D-at-large, said the administration should be looking at cuts in certain areas.
Need plan: Grumley and Sauline argued that the city will get deeper in debt without a recovery plan.
Melfi countered that an overall plan is premature. Actions have been taken to cut costs, he noted. For example, he pointed out some employee vacancies have not been filled.
Melfi said there can't be across-the-board cuts in employee levels because residents are entitled to police and fire protection and some recreational facilities.
Zirafi noted the payroll is 82 percent of the city's budget.
Treasurer John Martin said income tax revenues in June were down and he expects a decline in July.
Meanwhile, Melfi pointed out that if the city collects $3.3 million from the income tax this year, $1.4 million will be used to satisfy the city's long-term debt.
This includes $250,000 annually to pay off the purchase of Girard and Liberty lakes. The city paid $2.4 million for the nearly 1,000 acres -- buying the lakes as a long-term source of water. Dam rehabilitation and the cost to construct a water filtration plant would make the cost of water too high.
A mistake: Frank Rich, director of safety and human resources, said the city paid too much for the lakes and the city might have to sell them at a loss.
Also, the city plans to refinance the cost of the justice center through the sale of bonds. It is considering video arraignments of prisoners between municipal court and the county jail to save an estimated $20,000 to $40,000 annually in police overtime now being paid to transport them.