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Tax refund will cost village $175,000

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Monday February 23, 2015 9:41 AM

Johnstown’s finance director position has been a revolving door for several years, culminating in two months without a director in 2014, just as the village’s 2015 budget was being planned.

Dana Steffan, who was hired in October, has found her footing after less than five months on the job and is working to right the village’s financial ship.

Steffan informed Village Council on Feb. 17 of a significant portion of funds that Johnstown would have to pay back after yet another tax mistake gave the village money it should not have had.

Meanwhile, she said, she’s working to introduce a necessary rate hike for sewer and water services in the village.

According to Steffan’s council report, screen-printing company Atrium, which is based in Johnstown’s business park, has an unpaid tax refund of $175,000 from last year that has to be paid within the next 30 days.

“It’s unfortunate that the village has to pay this money, but it’s nobody’s fault and there’s nothing we could’ve done differently,” Steffan told council.

Steffan said she has been discussing with Regional Income Tax Agency representatives ways to change tax rates or credit factors in an effort to look for increased revenue, “which we so desperately need.”

Before other sources of income could be identified, she plans to propose a “three- to five-year” package to evaluate water and sewer revenues and expenditures and expects to include a rate increase.

The rate-increase proposal comes because of significant fund-balance decreases over the past three years in the water and sewer operating accounts, she said.

“We are hoping to not have to increase water and sewer rates,” Steffan said in an email. “But if we do, it will be as minor as possible. Only village residents and not those living outside village limits, pay the village for their water and sewer, so it would only affect village residents.”

The 2013 water rate for 2,000 gallons per month was $29.50, according Johnstown’s website.

According to Steffan, she plans to support her proposal with a history and analysis of revenues and expenses that will be presented to council by the end of February.

Village Manager Jim Lenner said if a change in rates would be necessary, a date would be set and the council would have to pass an ordinance that would require three readings and could take six weeks to pass.

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Council sweeps aside street-cleaner lease request

Monday February 9, 2015 12:04 PM
See the original online story here

Johnstown Village Council’s Feb. 3 meeting was mostly business as usual, with the exception of a mild debate regarding a street sweeper.

Village service director Jack Liggett asked council to approve a measure that would allow the village to lease a new street-sweeping machine.

Liggett said the village’s 1999 model and is in need of repairs that could cost as much as $25,000. He also pointed out that the machine is designed to clean parking lots, not an entire village.

He proposed entering a lease with a supplier for a 2015 Tymco 435. The $104,000 machine would be leased for 36 months at an interest rate of 3 percent, he said.

Liggett said a new street sweeper would more efficiently clean curbs, feature hydraulic brooms, help reduce pollutants in stormwater runoff and likely last 15 years.

Councilman Bill Van Gundy asked where the village would get the money for the lease.

Village Manager Jim Lenner said the only available money is in the estate-tax fund, adding that expenditures in the general fund already are earmarked through 2018.

Liggett said a lease would be a better option than a purchase.

“Buying the street sweeper all at once and not leasing it would be detrimental to our ability to bond more money,” he said. “By spreading it across over a lease, it makes our bondability better.”

According to Lenner, the balance in the estate-tax fund is $656,164.

As of Jan. 1, 2013, the estate tax, which had been imposed on transfers of assets from resident decedents, was abolished by the state.

Drawing such a large amount from special funds poses the risk of receiving a lower bond rating from Moody’s Investors Service Inc. and, therefore, higher interest rates. In 2014, Johnstown received the Moody’s highest rating of MIG 1 for short-term debt.

According to the Moody’s website, the MIG 1 designation “denotes best quality. There is present strong protection by established cash flows, superior liquidity support or demonstrated broad-based access to the market for refinancing.”

Mayor Sean Staneart said only the general fund should be used for such an expense, adding that the estate-tax fund shouldn’t be used unless the expenditure somehow generates income to replenish it.

“The street sweeper generates goodwill, not money,” he said. “Never, since I’ve been here, have we tapped into the estate fund to buy equipment. I think we need it, but I don’t think we have the finances for it. We already have a tight budget, and at some point, we have to start living within our budget. If everyone says they want a street sweeper, then let’s go to the voting booth.”

The vote was 4-3, with Sean Staneart, Bob Orsini, William Van Gundy and Cheryl Robertson voting against the street sweeper and Sharon Hendren, David Keck and Carol Van Deest voting for it.

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Johnstown poised to get funds for major repairs

View the online article here

Monday February 2, 2015 11:55 AM

Johnstown leaders should know within two months whether applications for state funding have been approved.

Johnstown in 2011, 2012 and 2013 requested a state grant to rebuild Concord Road.

This year, the Ohio Public Works Commission appears to have come through with a $290,000 grant and a $340,000 loan to rebuild Concord, the only access road for two large housing developments in the village. Concord begins off state Route 37, on the village’s southeast quadrant, and runs east all the way to Northridge Road.

The last significant repairs to Concord Road occurred in the 1980s. Only spot repairs and necessary maintenance have been done for the past 25 years.

The village submitted an application Oct. 2, 2014, to the Ohio Public Works Commission District 17 nomination committee to receive funding for this project. District 17 includes Delaware, Fairfield, Knox, Licking, Morrow and Pickaway counties.

District 17 on Jan. 23 recommended to the full commission approval of the grant and loan, Village Manager Jim Lenner said.

He said it would be exciting to finally be awarded funding after three unsuccessful attempts.

“Concord Road is one of the worst roads in the village and will only get more traffic as the village grows,” Lenner said.

Within the next 60 days, village leaders should find out whether Johnstown officially has been granted the money from the commission. Lenner said the full commission usually follows the districts’ recommendations.

The rebuilding of Concord Road would occur in two phases.

The first $200,000 phase would start near Middleburn Street and would be financed by the village.

The next phase would be focused on the first third of the road, from South Main Street to Concord Crossing Drive. This phase would occur after July 1, when the funds from the grant and loan become available.

The project is anticipated to create five-10 temporary jobs during the construction, according to the village’s grant application.

A construction bid process is expected to begin in early summer 2015 and construction would begin by mid-July.

The $340,000 no-interest loan would be for a 29-year term.

Lenner said it would be great to get such “free financing” from the state.

Currently, Concord Road is plagued with drainage issues, which have caused road-surface failures, Lenner wrote in the grant application. Motorists often have to avoid potholes or ruts by swerving into the opposite lane, he wrote.

In the spring, a motorcyclist was thrown from his bike after hitting a pothole on Concord Road and broke his shoulder. Without proper funding, all the city could do was update the sign warning motorists about the treacherous conditions, he wrote.

In the grant application, Lenner wrote that the concern for safety of motorists is of the utmost importance for village officials and residents.