By Jordan Cohen
Mayor Ralph Infante says his city can weather an estimated $200,000 in state funding cuts without having to lay off city workers, but residents should anticipate a reduction in services.
“We’ll do it by attrition,” the mayor said. “I’m expecting around 12 people to retire this year, and we’re not going to replace them.”
The mayor’s comments came during a roundtable meeting Wednesday with four members of city council and several city officials to discuss the planned cuts in state funds.
City Auditor Charles Nader said the state will slash 50 percent of the local government funds it allocates to Niles during the next two years, which will amount to a loss of nearly $200,000. The auditor warned that the city has little room to maneuver due to the declining revenue.
“Something has to happen with wages and benefits soon because it’s not getting better,” Nader said. “You’re knocking at the door right now.”
The mayor added Niles pays $3.2 million annually for employee hospitalization — an amount that he said the city can no longer sustain.
“We’ll have to do something about that in collective bargaining later this year,” Infante said.
Niles faces other revenue losses. It has experienced declines in income-tax collection averaging more than $400,000 annually due to fewer businesses and a drop in population. The latest census lists Niles’ population at nearly 20,000, a decline of more than 1,000 people.
In addition, interest on the city’s investments is down to one-half percent, according to the mayor.
“We used to earn $1.4 million a year [on investments],” Infante said, “and now we’re only getting under $40,000.”
City Treasurer Robert Swauger said he is not looking for higher-paying interest rates because they would require the city to “lock-in” meaning Niles could not withdraw the money without paying a severe penalty.
“You’d wind up paying more to get the money than you earned from it,” Swauger said.
The mayor noted that city services likely are to be reduced because none of the vacant positions will be filled while funds may be cut elsewhere for such projects as street resurfacing.
“We’re not buying any new police cruisers, we’re not buying firetrucks, and we’ve cut street resurfacing in half,” the mayor said.
However, Infante said the city will save an average of $50,000 in wages and benefits for each employee who retires. That would amount to nearly $600,000 in savings if all 12 mentioned by the mayor, including six police officers, follow through with retirement plans.
“These cuts were supposed to create jobs, but it seems we just keep eliminating them,” said Councilman Michael Lastic, D-at large.
Several councilmen said that despite the bleak outlook, Niles may be in better financial shape than some of its neighbors because city budgets have been reduced by nearly 10 percent each of the last few years.