Monday, January 10, 2011


No wonder the Stark Commissioners backed off talk about putting the 0.25 sales tax renewal on the ballot in May ballot.  It came out on Friday last that the county will be carrying over a $7.1 million surplus over from 2010 to 2011.

It is clear to the SCPR, had the county NOT come up missing $2.96 million (which federal Judge John Adams said he felt was stolen in its entirety by former Stark treasury Chief Deputy Vince Frustaci; Frustaci admitted to taking $2.46 million), then Stark County would be entering into 2011 with guess what?

A $10 million dollar surplus.


Who is keeping the books for Stark County?  Does anyone in Stark County government financial operations have credibility these days? 

Astounding, astounding; truly astounding!!!

Commissioners said Friday that a renewal has virtually no chance to pass in May.  Commissioners Bernabei and Ferguson did not include the $7.1 million surprise as one of their reasons for not pressing forward in the primary, but if they were wavering at all on the matter, the $7.1 million clearly could have been the  "straw that broke the camel's back!"  Commissioner Creighton did refer to the carryover as been among her considerations.

To The Report, the revealing of the $7.1 million reflects negatively on the believability of county financial officials who have the duty to collect and disseminate county financial information.  Not that they are intentionally misleading the public.  However, it clearly appears that they do not have a grip on a similitude of "real-time" county finances.

The Report understands that there is some lag between collecting and reporting, but a surprise such as this is unacceptable.

The new commissioners (Creighton and Bernabei) should be "not too pleased" at being blindsided by this news.  It is clearly bittersweet for them.

Obviously, they want the county austerity measures to be mitigated as revenue resources allow.  In this sense, the news of more carryover than expected is good news.

But, on the other hand,  it has to make them wary of the reliability of the financial data they are getting. 

The SCPR believes that Commissioners Bernabei and Creighton, with the full cooperation of Commissioner Ferguson, have already taken significant moves to restore public trust and confidence in county government.  Moreover, the commissioners acknowledge that they have much more work to do.

The question that has to lurk in the back of their minds is whether or not they will be undermined on county financial information they present to the public in the future with revelations akin to the one that surfaced on Friday.  For if a repeat happens, their efforts to build credibility will suffer measurably.

In a conversation that yours truly had with Mike Hanke after Friday's meeting, he seemed to be pointing at the Stark County Budget Commission comprised of Stark County Auditor Kim Perez, Stark County Prosecutor John Ferrero and Stark County Treasurer Alex Zumbar.  Of course, for the time period we are talking about, Zumbar was not treasurer and for most of the period former Treasurer Gary D. Zeigler would have been the treasury's commission member.

Of course, the SCPR is not real well taken with member Ferrero and his financial wizardry.   Ferrero has already admitted in a commissioner meeting a few months back that he does budgeting of the Stark County prosecutor's office with an element of a hope and a prayer.

The SCPR is skeptical of the Hanke suggestion that it is the commission's fault.  However, he may be correct.

But just so the Stark County public has independently elected members on the Stark County Budget Commission, perhaps, a couple of financially and fiscally astute citizens should step forward to run for the commission.  However, first, some group - let's say, for example the "Vote No Increased Taxes Committee" - will need to circulate petitions to get county voter approval of adding two new members to the commission (see the statutory language below).

For months yours truly has sat at commissioner meetings and drumbeat after drumbeat after drumbeat heard the doom and gloom from the commissioners about 2011 and 2012 and beyond.

Commissioners mandated 16% cuts from all county general revenue funded departments and warned that if the 0.25 sales tax set to expire in June, 2011 wasn't renewed or replaced with equivalent revenues, there would be an additional 25% cut in 2012.

Revelations of the $7.1 million tend to give credence to those Stark Countians who adamantly maintain that Stark County does not need a county "add on" to Ohio's sales/use tax and by offering services

In post-meeting press interviews, County Administrator Mike Hanke offered "reasons why" the enhanced surplus materialized.

Laurie Huffman of The Alliance Review put it very aptly in Stark voters won't see sales tax on ballot in spring (January 8th edition)
When questioned after the meeting on the $7.1 million carryover, Mike Hanke, county administrator, said the county moved into 2009 with a $1.7 million carryover and into 2010 with $6.2 million. The extra sales tax imposed by the then board of commissioners is what fueled the jump in carryover between 2009 and 2010, he explained. There was an additional $11 million generated before the sales tax increase was repealed, and the county took $5.5 million, which was put into the budget stabilization fund. The other $5.5 million went toward the county 911 dispatch system.
Hanke further reported after the county covered the $3 million stolen from the treasury in 2010, there was roughly $2.2 million left in the budget stabilization fund. Add into that $3.2 million in uncertified funds, or revenue funds from various county departments, and $1.6 million in unspent funds, and the total comes to about $7.1 million, in round figures.
“We were only hoping for about a $5.5 million carryover, so this is obviously very hopeful for us,” said Hanke, “and we hope to put a good portion of the money back into the budget stabilization fund because there is $11 million less in revenue projected going into 2012, without the sales tax renewal or increase. And, you can see it is not on the ballot yet.”
A question that the SCPR asked Hanke is whether or not commissioners can expect a "blow-back" from county officeholders once it dawns on them that the county has more "extra" money than was originally projected.  Hanke acknowledged that there might well be a reaction from county officeholders affected by the 2011 budget 16% cuts.

SCPR readers will recall that there once was talk that money set aside for rehabbing Stark's countywide dispatch system ($2.5 million) be diverted to lessening the degree of cuts made by Sheriff Swanson.

The commissioners deserve not to be surprised by the information they got on Friday.  In order to effectively manage the finances of Stark County, what information they get needs to be highly accurate.

Here is a video of commissioners acting not to place the 0.25 sales tax renewal on the May ballot and planning to take county government out to the people.

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