News Column

Jeannette officials diverge on fiscal outlook

July 11, 2014

By Richard Gazarik, Tribune-Review, Greensburg, Pa.



July 11--A Jeannette councilman contends finances are not as deep in the red as the mayor claims, but he concedes the city could end the year with another deficit.

During a meeting this week, Councilman Bill Bedont agreed with Mayor Richard Jacobelli's assessment that the city is spending more than it is generating in tax revenue.

Bedont, director of finance, said revenue has increased this year by $190,000, and an earned-income tax hike from 1.15 percent to 1.5 percent has generated $663,000 to date and should reach $1.3 million by year's end.

"We need to be able to pay $3.4 million in expenditures by the end of the year," Bedont said.

He estimates the financial shortfall for 2014 would be about $50,000.

"Is it going to be close?" Bedont said. "Absolutely. I feel pretty good at the end of the year."

Jacobelli said he is not as optimistic.

"I still have my concerns," he said. "We have obligations to pay. I'm not going to sit here and say everything is fine.

"I just paid $125,000 to the police pension, and I'm still looking at $546,000 for this year and a tax anticipation note of $100,000. Then there's the public works and firemen's pension. That's another $160,000 or so," Jacobelli said.

An audit showed Jeannette ended 2013 with a budget deficit of $615,000, and Jacobelli expects the city will end this year with another sizeable deficit.

Bedont said paying off the 2013 pension contribution "is not an issue."

"We're not going to eradicate all pension loans in one year. We're going to put a big dent in it this year. Hopefully, we're back where we need to be next year," he said.

Jacobelli, who took office in January, said he isn't sure where the city stands financially, claiming Bedont has not kept the mayor up to date.

"You don't know where we are?" Bedont asked. "You've been here for six months. There's no intent to demean the mayor. He's done a fabulous job. He's come up to speed very quickly. But when things are being quoted in the paper without knowing everything, I really get hurt by it. I do owe him a sit-down."

Bedont said he has been transparent about city finances. "I do not hide anything. No one has been more forthright than I have," he said.

Councilman Gabe Homan noted the city's population and tax base continue to dwindle. Jacobelli pointed out that fewer than half of the 9,600 residents are property owners.

Council rejected a measure that would have allowed residents to decide through a ballot referendum in November whether they want to retain a paid fire department or rely on volunteers.

While Homan pegged the savings at between $200,000 and $250,000, Bedont said the savings would be only about $100,000.

City residents pay 32.62 mills in taxes, as well as 82.72 mills to the school district and nearly 21 mills to Westmoreland County. Under the Third Class City Code, Jeannette can't increase property taxes to generate revenue.

"We've reached the maximum," said city attorney Scott Avolio.

Jacobelli said the budget deficits point to the need for hiring a city manager. Council is interviewing candidates and hopes to hire a manager by September.

"Then we'll see real budgets that mean something," the mayor said.

Richard Gazarik is a staff writer for Trib Total Media. He can be reached at 724-830-6292 or rgazarik@tribweb.com.

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(c)2014 Tribune-Review (Greensburg, Pa.)

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Source: Tribune-Review (Greensburg, PA)


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