Cuyahoga Falls -- Some members of City Council have voiced concerns about benefitting financially from an unexpectedly large estate tax settlement the city has received.
The Robart administration has proposed sharing the good fortune by giving a one-time salary supplement to its full-time employees, members of City Council and its clerk. Legislation to accomplish this was discussed by Council's finance committee Dec. 3.
Some citizens on hand suggested the money go toward improving life or services for all residents.
According to Finance Director Joseph F. Brodzinski, the estate of a woman in her 80s has contributed more than $1.03 million to the city's coffers. He estimated the gross value of the woman's estate as being "between $15 [million] and $20 million."
The city received the estate tax settlement in October.
Mayor Don L. Robart said the city has chosen to allocate "about two-thirds" of that amount back to its full-time employees; the other one-third would be allocated to the city's future budgets, he reported.
Legislation before Council, if passed as proposed, would authorize the city to pay a one-time salary supplement of $3,500 to every full-time city employee, both bargaining and non-bargaining, next month. Eligible employees must have been on the city's payroll as of June 30, 2012, Law Director Paul Janis said, and still be on the city's payroll as of Dec. 31, 2012.
Also proposed is a one-time salary supplement for members of City Council and its clerk in the amount of $1,250. Unlike a bonus, Janis said a salary supplement is not linked to performance.
The city had 379 full-time employees as of Dec. 3, according to a spokesperson for the Human Resources Department.
"I think it's offensive that we're voting to give ourselves a raise," Council member Carol Klinger (R-at large) said Dec. 3.
Colleague Carrie Hummel Snyder (D-at large) echoed that sentiment in a Dec. 5 email to the Cuyahoga Falls News-Press, saying, "Personally, I do not feel it is appropriate to vote on a salary supplement for myself."
"I will be opting out of this one-time payment," Council member Jerry James ( D -7 ) announced Dec. 3 "because I think it's just fiscally irresponsible, considering … the finances of the city. I would feel better just putting it back into the city's resources and have them use it for something, rather than just [ lining] my pocket."
Brodzinski said money declined by Council members would remain in the city's general fund.
Council President Mark Ihasz (D-4), as well as Council members Don Walters (D-6 ), Jeff Iula (R-at large) and Vince Rubino (D-1), said they do not intend to accept the salary supplement, either.
"I was elected by my constituents and they pay my salary," Ihasz wrote in a Dec. 5 email to the News-Press. "Therefore I would like my salary supplement to be given back to the residents." Council member Mary Ellen Pyke (R-2) asked if it would be possible to earmark refused funds to the K-9 unit. Rubino announced he intends to designate his funds toward the city's safety forces.
Resident Mark McCullough questioned why the administration was proposing a scenario that would benefit city employees only, and not the residents as well. He suggested the money be used to reinstate the senior snow removal program. "I can't imagine … giving yourselves a raise," McCullough said. "That's mind boggling …" He asked who decided to share the windfall with employees, instead of the residents. Brodzinski said the proposal is the brainchild of the administration and is meant to show the city cares about its workers. According to Brodzinski, city employees received just one raise over the last four years and have agreed to concessions. The finance director noted the estate tax settlement is "one-time money," so he said reinstating any program or hiring additional employees would not be an option since those would incur ongoing expenses.
Fallsite Terry McHugh said he believes the city pays its employees well -- and noted he hasn't received a raise "in almost five years." He suggested city officials put the funds aside "for a rainy day."
Dave Witner, president of Firefighters Local 494, said the majority of his membership has endorsed the proposal.
"We felt it was a very fair offer from the city for a one-time payment," Witner said.
In 2011 the firefighters union agreed to extend its contract with the city through 2013. Witner said the union would agree to extend that deal an additional year, through the end of 2014, if the one-time salary supplement is approved as proposed.
Finance Committee Chairperson Diana Colavecchio (D-5) asked if the Ohio State Tax Division has audited the return and found the amount of tax paid was proper.
"This is a huge estate," Colavecchio said, "… In an estate of this size, it wouldn't be uncommon that the executor comes back at a later point in time and amends this inheritance tax return, claiming deductions they weren't aware of at the time they filed it … My concern is that this money, sitting in our coffers today, might be subject to audit and the Department of Taxation might come back to us at a later point in time and tell us, 'You gotta give some of that back' and we really don't know how much that might be."
Colavecchio also asked the finance director to cross-reference the individual tax returns that the woman had filed with the city.
Council's finance committee did not move the legislation forward for a vote, agreeing instead to revisit the proposal Dec. 17.
City Council convenes Dec. 10, beginning at 6:30 p.m., in the municipal building, 2310 Second St.