Another budget debate looming

Findlay Council is forging ahead with plans to dedicate 20% of the city's expected revenue this year to capital plans, despite continued concerns about deficit spending to operate the city this year. That makes a total of about $5.3 million available this year to be invested in projects and equipment from the capital fund, plus the fund's balance of $3.8 million coming into the year and $4.6 million in the city's flood mitigation account. The number doesn't include grant money or other sources of revenue. At Tuesday's regular meeting of council, Councilwoman Holly Frische, R-1, said she "respectfully plans to hold the mayor's feet to the fire," and pressed city administrators for a date to review this year's capital plan. Mayor Christina Muryn said the administration is going over the capital spending plans with city departments now. While there has been considerable debate about the financial forecasts among city leaders, at Tuesday's meeting, Auditor Jim Staschiak said there is "no doubt" that the city is deficit spending, and advised council to watch the numbers closely and be prepared to act quickly if the city starts to go "upsidedown." He said the city's cash position is weakening, citing both less in investments and a rainy day fund that is now less than $2 million, after being adjusted down by $170,000 this year, based on state budget requirements. According to the city budget approved by Findlay Council in January, spending over the next two years, if it follows projections, will drop the city's year-end balance to $9.5 million. That's below the city's minimum reserve balance, estimated at $10.9 million for budget year 2026. Findlay has a history of adopting deficit budgets each year, and then working to manage its way back to a balanced budget. The city is expected to spend about $41.5 million to operate in 2025, compared to about $38 million in actual spending in 2024. Income tax collections in 2025 are expected to be $32.1 million. The budget shows city spending outpacing revenue by $5.8 million in 2025, and $7.6 million in 2026. Staschiak has called it "the largest two-year deficit proposed since the Great Recession," and an indicator that the city's budget is no longer sustainable. Wage concessions and the end of the "huge windfalls" in business taxes are driving the deficits, according to Staschiak. However, Muryn, who has a background in finance, has publicly challenged the budget numbers. For example, the adopted budget shows interest earnings dropping by $895,020 this year. She disagrees. The mayor predicts additional tax revenue, interest earnings, reimbursements, grants, etc., will increase the revenue projection by 3-5% in 2025. She said that figure has been consistent for the past six years. She said the general fund balance could increase, despite the projected deficits. She said revenues in 2024 also beat projections by about $3.7 million. On Tuesday, the mayor said city departments are working to beat budget again this year, and reiterated that money left unspent will be returned to the general fund regularly throughout the year, as opposed to a lump sum amount at the end of the year. City departments returned about $2.8 million in unspent appropriations to the general fund at the end of 2024. The city's 10-year, long-range capital improvement plan is available on the city's website at www.findlayohio.gov.