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Munroe Falls looking at changes to community improvement corporation

by Jeff Saunders | reporter Published: August 14, 2016 12:00 AM
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Munroe Falls -- The city may soon be on the lookout for a sixth private citizen to serve on the city's community improvement corporation board of trustees, but there may be a legal complication.

City Council gave first reading Aug. 2 to a resolution that would cut the number of Council representatives on the 10-member board from three to two, but the resolution may be in conflict with the CIC's own bylaws.

The CIC was created by City Council in 2009 with a resolution authorizing its incorporation under state law, as well as establishing the bylaws. According to the city's website, the CIC is a non-profit organization that provides "gap financing" to businesses to supplement private financing as a way to stimulate economic development.

"Primary uses of such funds include renovation and restoration of buildings, site improvements, acquisition of capital equipment, training, expansion, and other upgrades," states the website.

Under the CIC's bylaws, the board is to include five elected and appointed city officials: the mayor, Council president, the economic development director and two other Council members, specifically the chairpersons of the finance and audit and the community and economic development committees. The remaining members come from the private sector and are elected by the board.

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Councilor Mike Barnes, who is not a CIC board member, sponsored the resolution. Barnes told the Stow Sentry after the Aug. 2 meeting that he believes it is best to reduce the number of Council representatives from three to two, and increase the number of private sector members from five to six, because Council approves funding for the CIC.

"In my opinion, that's a little bit of a conflict," said Barnes.

He also said that the change would still satisfy state law, which requires a minimum for four members to be appointed or elected city officials.

Councilor Steve Stahl, who serves on the CIC in his role as Council's finance and audit committee chairman, said he would be OK with the reduction, although he suggested that the two Council members could still be chosen from among the three Council positions currently required.

"I think there's an advantage to having one other non-legislative member on the committee," he said.

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Stahl added that increasing flexibility as to who serves on the CIC board may be needed because some Council members, himself included, may have difficulty attending meetings because of work commitments.

However, while discussing the matter further during Council's Aug. 9 finance and audit committee meeting, which Barnes did not attend, Council members raised the question of whether Council has the authority to unilaterally make changes to the CIC's bylaws.

"The CIC is an independent agency," said Stahl.

Councilor Chris Ritzinger said, "I can see this Council making a recommendation to the CIC for a change in the bylaws."

Mayor James Armstrong said Law Director Tom Kostoff, who also was not present, was researching the matter.

The bylaws themselves provide provisions under which they are to be amended: "These bylaws may be amended by a writing signed by two-thirds of the [10 CIC] Trustees, or by a majority vote at any meeting of the Trustees, provided that the notice of said meeting stated the consideration of the amendment to be the purpose of the meeting."

Council President Gary Toth said that until the question is resolved, he would not support voting on the resolution.

"Is this legitimate?" he asked, holding up the proposed resolution. "We're not talking about the bylaws of the city, but of the CIC."

Armstrong said, "I can see Mr. Barnes' position," adding that he would like to see the CIC successful in its task.

"I'm just hoping we can find some businesses that are looking to come in here," said Armstrong.

Funding for the CIC

Funding of the CIC was a topic of discussion at an earlier meeting.

During the July 12 City Council meeting, legislation was brought forward for a vote to authorize the transfer of $25,000 from the general fund to the CIC. The resolution for the transfer of the $25,000 was approved 6-1, with Barnes casting the dissenting vote.

According to legislation in May 2013, then-City Council members approved the appropriation of $50,000 to fund the CIC. However, at that time, only $25,000 of that appropriation was transferred.

Stahl said originally, $100,000 was sought, but Council approved the $50,000.

"The mayor is just wanting to bring the books into compliance," he said referring to the 2016 legislation.

He added the funds were from the sale of property and not tax money.

But Barnes questioned why the money was being moved to the CIC if the city could use it for other needs.

Armstrong responded it was supposed to be transferred per the 2013 resolution and cannot be legally used for other purposes unless Council would rescind the earlier appropriation.

"I think it's important to have a CIC program," the mayor said. "It's important to show the city's good faith . . . the more flexibility we have to entice [businesses], the better," he added, noting Munroe Falls has competition from surrounding communities, such as Tallmadge, Cuyahoga Falls and Kent.

Barnes said with talk of the city's financial needs, it "would make more sense" to rescind the $25,000 for other things.

Anne DiCola, the city's community/economic development director, disagreed, describing the CIC as the "economic arm of the city."

Editor's note: Senior Editor Marsha McKenna contributed to this report.

Email: jsaunders@recordpub.com

Phone: 330-541-9431

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