City could clear fiscal watch status in 2021


City Manager Sam Sutherland (left), pictured here during a Nov. 23 Portsmouth City Council meeting, says an increase in sanitation rates might be needed to prevent its fund from going into a deficit. The fund is currently in the black. File photo.

PORTSMOUTH — Mayor Kevin Johnson says the city’s financial outlook has improved throughout the past few years, but there are still roadblocks in clearing the fiscal watch hurdle.

Perhaps the most significant roadblock remaining City Manager Sam Sutherland says is the sanitation fund, which is at risk of being in a deficit although not currently. Other funds- general, water, sewer, streets, and insurance- were reporting deficits at one time which prompted a state fiscal watch but have since improved.

While the most recent 2019 Comprehensive Annual Financial Report found a General Fund actual balance of $5.9 million, Sutherland says action through form of rate increases is still needed to keep the sanitation fund from going into the red in the future.

“The state put us in a fiscal watch status, and things have to be corrected to get us out of this status,” he said during a Tuesday interview. “I think we’re along the ways towards that, but there’s still some discussion that we have to have with the state.”

“I think they’re small hurdles, but they’re still hurdles that we have get over to get the status actually lifted.”

According to the city website, there are differing rates for sanitation divided into regular and senior monthly billings. These groups both pay an extra $5 for each additional issued tipper can, but seniors pay $15.50 per month instead of the regular rate of $20.50. The division, employing 13 full-time workers, is responsible for the trash removal and pickup from residential and commercial areas in the city.

Still, in draft form, where the City Managers’ Office and the Ohio Auditor’s Office are reviewing the numbers, Sutherland said increases to those rates across the board will likely be needed.

“Whatever that percent increase turns out to be, it will all fall in-line with those three different rates,” he said, where he called the regular $20.50 rate the primary one in focus.

During the City Managers’ session on Jan. 11, Sutherland shared two past ordinances that were seen as a way to correct the city’s sanitation fund deficit at the time.

The first measure, passed in 2013, proposed a gradual increase of rates to get out of the deficit. When then City Manager Derek Allen began analysis the following year, however, it was determined that a different plan would be needed.

“The other ordinance probably would have taken care of it, but it was a long-term thing,” Sutherland said. “That fund was in such a bad situation that it needed to be acted on.”

Allen’s 2014 plan served as the next and faster remedy for the city to correct the situation, he said, were minutes from a July City Managers’ session of that year said the fund started the year in a $40,000 deficit and projected to end 2014 with a $400,000 shortage.

The report reads the change was due to the cost of manpower, health insurance and the increase from $265,000 to $600,000 to haul the trash to the landfill.

“We erased the sanitation rate and they are aware of that and he’s confident we’ve addressed that problem,” the report states, which also details the status of the General, Health Insurance, Enterprise, Wastewater, and Street funds.

Sutherland wanted to revisit the topic as all current Council members, with exception for Mayor Johnson, were not representing their respective wards when these changes were enacted.

“If the former city manager didn’t put it in play, we’d probably be in real, real bad situation,” he said to City Council during the meeting, referring to Allen who resigned in February 2018. “We don’t want to go backwards.”

Reach Patrick Keck (740)-353-3501 ext. 1931, by email at pkeck@aimmediamidwest.com, or on Twitter @pkeckreporter.© 2020 Portsmouth Daily Times, all rights reserved.