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New mayor confronts reality of Youngstown’s bleak budget



Published: Sun, January 19, 2014 @ 12:00 a.m.

Just days after he was sworn into office, Mayor John A. McNally was confronted with a reality that could haunt his administration for the foreseeable future: Youngstown government is on financial thin ice.

But if there’s a silver lining in this dark cloud, it is that the $2 million revenue shortfall in 2013 gives the new mayor the ability to tell city workers that pay raises are off the table in the labor negotiations.

It should come as no surprise that unions attempt to take advantage of a new administration, especially during contract talks, which is why it helps for the mayor to be able to say, “The cupboard is just about bare.”

And before the unions argue that the city does have the $2.86 million it received from Vallourec Star earlier this month, here’s a reality check: the payment from the steel pipe-making company will be reduced to $100,000 a year for 96 years starting in 2016.

In other words, the three checks — last year, this year and next year — represent “one-time” money that should not be used for such things as payroll and other long-term obligations.

The same goes for the $1 million in unanticipated revenues last year.

KEEPING TIGHT REIN ON SPENDING

Mayor McNally, who ran on a platform of dealing with the city’s long-term financial obligations, especially the $11.9 million loan that was used to help pay for the construction of the $45 million Covelli Centre, will have to keep a tight rein on spending as he figures out what to do about the revenue shortfall.

In 2013, the city had projected collecting $44.15 million in income and business profit taxes, but actually received $42.13 million. The shortage was the result of companies not being as profitable as the city thought they would be.

McNally is absolutely right in erring on the side of caution when spending taxpayer dollars.

Youngstown government’s financial future is uncertain at best. Thus, revenue projections should be on the conservative side.

And that means spending priorities must be established that address the most pressing problems in a city that has a declining population, stagnant tax base, an intractable crime problem and deteriorating neighborhoods.

During the campaign, McNally said that one of his priorities would be the demolition of dilapidated and abandoned houses.

His predecessor, Charles Sammarone, now president of council, tore down more structures in the two years and four months he was in office than mayors before him.

McNally wants to expand the demolition program, which means dedicating more money than had been spent previously.


Comments

1author50(1121 comments)posted 3 months ago

Yet, they found $75,000 to create a job as second deputy director of law for Anthony Ferris whom Mayor McNally didn't want as Law Director in the first place.

Yet (but not under Mayor McNally) oodles of money to fund shaky financial models for even shakier financial risks known as bars and taverns, and when the debtor defaults on the taxpayer money they are either not pursued or lent more money (i.e. Chris Sammarone's $20k for Dooney's and then another $20k of taxpayers money for Chris Sammarone's Warehouse 50 DESPITE the Dooney's money not being repaid).

It appears that Mayor Sammarone's bulldozing of more structures was more because of the free money that the Mahoning County Land Bank received from the State Attorney General's office via the Federal settlement with banks over the bankers fleecing millions of homeowners and paying hefty fines to stay out of jail themselves. The cleaning up the blight is a noble gesture but under Sammarone, due process of law was ignored, not to mention the City of Youngstown's own ordinance 1525.02 in proper notice being given to owners before ripping the vacant homes down.

The new Mayor has to clean up the train wreck of Sammarone before he can start truly putting his own mark on the city of Youngstown.

Suggest removal:

2eivo(1452 comments)posted 3 months ago

Instead of spending oodles of money on bars and tavern, they should use that money to break ground on a new and bigger prison.

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