Pickerington addresses debt


According to a new five-year forecast unless adjustments are made, the city of Pickerington will fall into debt by the end of 2009.

"I am not pressing the panic button right now, but decisions will need to be made about city services in the next year," City Manager Judy Gilleland said at Pickerington City Council’s budget and council meetings on Dec. 4.

Gilleland recommended that early in 2008 the city create a task force of council members, staff and citizens to examine how to cut costs and/or increase revenue.

Some money-saving measures have already been put into place.  The city raised the amount employees must contribute for their health insurance to 7 percent.

In addition, Pickerington now offers employees a high-deductible health savings plan that will save the city even more on its health insurance expenses.

At a previous council meeting, the possibility of laying-off employees and losing services was mentioned, however, council has no plans for this at this time.

Councilman Brian Wisniewski said council has not cut any personnel and that currently "everything is on the table."

"Rest assured we will look at all avenues before we make any decisions," Councilwoman Cristie Hammond said.

Pickerington relies on conservative budgeting, meaning the city estimates low on how much money it will have.  In 2007, the city estimated the General Fund would have a beginning balance of nearly $1 million and it actually collected $300,000 more than the estimate.  

For 2008, the city estimates the General Fund will have a beginning balance of nearly $950,000 and an overall budget of nearly $25 million.  Budgeted expenses for 2005 total $18.5 million.

In addition, Pickerington has a Capital Improvement Plan estimated to total more than $13 million. Items in the plan include improvements to the intersection of Refugee and Hill roads, which could cost as much as $900,000 and the widening of Diley Road.

The Ohio Department of Transportation (ODOT) will pay for most of the Diley project, but nearly $600,000 may be Pickerington’s responsibility. ODOT required that Pickerington advance them the $600,000 before the bidding process begins on Dec. 12.


ODOT will hold the city’s money for two years to ensure the contracts are paid, said Finance Director Linda Fersch. If the bids are lower than estimated, the city will receive money back. If however the bids are higher, the loans that Pickerington borrowed to cover the Diley project will not be enough and the city will have to draw on its General Fund.

Additionally, Pickerington has a list of contingency items that could not fit into the budget. For instance, the budget does not include any street paving or refinishing plans. The estimated cost of paving is $300,000. If the city wanted to hire another police officer, it would cost an additional $75,000.

The city receives most of its money from the 1 percent income tax it collects, which Gilleland said is low compared to neighboring communities. In addition, the city receives revenue from 7 percent of property taxes, state and county sources, utility fees and impact fees.  

Despite the negative turn in the budget, the city received an award from the office of State Auditor Mary Taylor for excellence in financial reporting.  

In a written statement, Taylor describes Pickerington’s 2005 comprehensive annual report as "truly a model for all government entities throughout the state."

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