Findlay's new council questions budget

FINDLAY — Findlay's newly seated council worked its way through the rigor of its first official meeting on Tuesday, voting to adopt the city's new operating budget, but not without pushback from some members. Council voted 10-0 to waive its three-reading rule, needed to rush the legislation. Failure to approve the budget would leave the city unable to spend money, including payroll and vendor payments. The vote was 8-2 to adopt the new budget, with councilmen Rodney Phillips, R-6, and Danny DeLong, R-7, opposed. The $130 million spending plan represents the total budget across all funds, including water and sewer operations, airport, parking, capital improvements and restricted accounts such as flood mitigation. By contrast, the proposed $41.2 million operating budget refers only to the General Fund, which covers day-to-day services like police, fire, streets and administration. The overall budget includes money earmarked for specific purposes. The General Fund is where council has the most discretion. For 2026, the city projects $36.2 million in revenue against $42.1 million in general fund expenses, leaving a $5.9 million shortfall. Another $5.5 million deficit is forecast for 2027. Findlay has a history of adopting deficit operating budgets each year and then working to manage its way back to a balanced budget. This year, city departments will return about $2.3 million in unspent appropriations to the General Fund. The city's carryover cash balance has dropped from $30.5 million in 2024 to a projected $21.5 million for 2026, according to Auditor Jim Staschiak. He has called the drop "significant" and indicative of a "structural imbalance" in the budget, leaving the city dependent on its carryover balances to right the books. Staschiak is predicting a $3.4 million operating deficit for 2025. Mayor Christina Muryn has described the spend-down of the city's cash carryovers as intentional. She said it has allowed Findlay to pay cash for big-ticket items like a $1.6 million fire truck, pay more than $4 million for the design of the proposed Downtown Recreation Area and set aside $4.66 million for flood mitigation, all without borrowing. A motion by DeLong to reduce spending in the General Fund budget by one hire, a new person for the city's Human Resource Department, at the cost of $86,250, was also defeated by an 8-2 vote, with only Phillips and DeLong in favor. DeLong said while the city's tax collections continue to fall short of projections, budget numbers continue to climb, including increases of 14% for the mayor's office this year, 15% for the law director's office, 34% for buildings, and 92% - that new hire - in the Human Resource Department. DeLong said he wants to see actual numbers for 2025 spending before making the hiring decision, figures that are not yet available. In December, Phillips asked that "as a team," the auditor, administration and council members take the budget "back to the drawing board and have the tough conversations followed by the tough decisions to get spending more in line with projected revenues before the first council meeting in January." "Revenue grows at close to 4%, while expenses rise at 8%. Deficit budgeting was less impactful in 2022 and 2023, when our cash reserves were much larger," said Phillips. "It seems clear, however, as we move into 2026, an alternative strategy must be called for. If not, the only thing in doubt is what year we will be below the cash reserve. Without change, it's a matter of when, not if," he said. The budget, however, was presented to council on Tuesday unchanged. Phillips called it a "flawed system," with new council members being asked to approve a budget "that we don't know a lot about." Heather Kensinger, R-at-large, voted in favor of adopting the spending plan, but said she's "struggling" with how the city does its budgets. Kensinger raised concerns about the city's need to hire more firefighters and said that in the future, she can't foresee supporting a city budget that doesn't add more firefighters. She said council needs to make improving the budget process a priority. Councilman Kevin Cullen, I-5, who said he agreed with Kensinger, said the city's true financial position coming out of 2025 won't be known until the year-end numbers are made final in the coming weeks. Cullen argued that the city isn't operating at a deficit. "We do run lean, and that was an eye-opener," he said. Changes to the city's budgeting process are already on the way, Muryn said Tuesday, citing new rules already made by council's new Finance Committee. Formerly known as the council's Appropriations Committee, the name was recently changed to Finance Committee after considerable debate over the council's role in city investments. The Finance Committee is charged with stepping up council's oversight of investments, along with reviewing city spending plans. Moving forward, she said council will be provided with a more in-depth review of city finances each quarter, a new requirement established by the committee. Councilman Dan DeArment, R-4, Findlay's only returning councilman this year, echoed the mayor's comments and said he is excited about the future work of the committee. "I think the next two years will be very different," he said. Editor's Note: This story has been updated from an earlier version to correctly identify Councilman Kevin Cullen as an independent representative on council.