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Munroe Falls -- After months of trying to convince city voters of a need for additional revenue, city officials must now draw up a 2017 budget with considerably less money than was hoped.
Voters in Munroe Falls supported Issue 22, a capital improvements tax levy, but rejected Issues 20 and 21, an increase in the income tax rate and a police levy, during the Nov. 8 general election. Mayor James Armstrong "absolutely" plans to make another attempt to get the failed issues back on the ballot "the first chance I get."
"The city is in financial difficulty, and this isn't like a wish list," he said Nov. 9. "These were the basic fundamental needs of the city that we were pursuing. I can't help the situation I inherited. All I can do is fix it."
According to final but unofficial results from the Summit County Board of Elections, Issue 22, a 10-year, 2-mill capital improvement levy, received 1,489 (52.21 percent) votes in favor of the levy and 1,363 (47.79 percent) against. The levy is expected to raise $214,000 annually and cost homeowners about $70 annually per $100,000 in market value.
Armstrong said that because property tax receipts are six months behind collections, the city will only receive half of the money next year, all in the second half.
The approval of Issue 22 "will assist the city in addressing long overdue road repairs and other capital projects," Armstrong said Nov. 8, as the election results were coming in. "The passing of the capital improvement levy is a necessary step toward putting the city of Munroe Falls back on a solid financial foundation.
"It is, however, of great concern that the police and operating levies failed to receive enough votes to stabilize the city's financial situation," he added. "Operating already on a restricted budget that currently operates with less funds being received than are necessary to provide the basic services a resident should expect from their city, in the next few weeks we will attempt to determine where any other reductions can be made and what services can be safely eliminated."
Voters rejected Issue 20, an increase in the city's income tax rate from 2 percent to 2.25 percent, with 1,488 (52.78 percent) votes against the increase to 1,331 (47.22 percent) in favor.
"I'm optimistic in the sense," said Armstrong on Nov. 9, "that when I had an opportunity to talk to individual residents and explained it and that it was a comprehensive package to not overly focus on property taxes and people understood that if they were working in other cities like Akron that they weren't going to get [an income] tax increase, it made a lot of sense to them. It just appears that the fact we came up roughly 150 votes short on the income tax that I just didn't reach enough people."
Issue 21, a five-year, 2.8-mill police levy, was also defeated, with 1,483 (52.16 percent) against to 1,360 (47.84 percent) votes for the levy.
"I feel bad for the police because they work hard and I think they were disappointed in the results," said Armstrong. "I think the people on the force know the importance of having a full-time department just as a matter of the best law enforcement method as opposed to the overreliance of part time."
City officials have said that issues 20 and 21, if they had been approved, would have respectively raised approximately $276,000 and $300,000 annually.
"Although only one of the three vital levies passed, it was a positive to see six of the seven [City] Council members, the finance director, law director, police chief, fire chief, service director along with a few concerned citizens, using their personal time on weekends and evenings going door-to-door in an attempt to inform the voters of the serious financial problems and the proposal to address these issues through a comprehensive balance between property and income taxes," Armstrong noted. "If passed, Munroe Falls property taxes would have still been less than Stow, Cuyahoga Falls and Silver Lake and the income tax would have been commensurate with Akron and other communities, meaning a significant number of our residents would not have seen any increase in their income taxes."
City officials say that the income tax increase would have gone a long way toward making up for an operating deficit cutting into the general fund cash reserves, which were at about $1.63 million at the beginning of the year.
Most years, City Council approves the city's permanent budget appropriations for the following year before the end of the current year, but Armstrong said that because of uncertainties and complications caused by the three issues, Council is only expected to approve a temporary 2017 budget by Dec. 31. Under state law, a permanent budget has to be approved by March 31 each year.
Armstrong said that GPD Group, the Akron-based firm the city recently hired to handle engineering needs, will do a comprehensive assessment of city roads to prioritize needs for a street program "in, God willing, 2018."
However, he added, what is still unknown is whether the additional capital revenue will be used to increase capital spending or to replace some current capital funding that would then be directed to other needs.
"That's the big question," said Armstrong. "With the operational deficit, $300,000, $400,000 the last couple of years, we have to address that. We can't keep spending money we don't have."
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