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City of Massillon Placed in Fiscal Emergency
Columbus – Deficit fund balances prompted Auditor of State Dave Yost today to place the City of Massillon (Stark County) in a state of fiscal emergency.
“Today, Massillon starts the path towards fiscal health,” Auditor Yost said. “Some tough choices will have to be made along the way, and my office stands ready to assist officials and the commission in bringing financial stability back to the city.”
Massillon Mayor Kathy Catazaro-Perry requested a fiscal analysis be performed by the Auditor of State’s office to determine if the city’s condition justified the declaration of fiscal emergency. The Auditor of State’s Local Government Services Section conducted the analysis and determined that the City of Massillon is in a state of fiscal emergency due to deficit fund balances totaling $518,182 and $135,906 as of December 31, 2012 and May 31, 2013, respectively.
The city will now come under the oversight of a Financial Planning and Supervision Commission. A financial plan must be developed by the commission within 120 days of its first meeting to address the city’s financial crisis. The Auditor of State’s office takes an advisory role to the commission and may provide accounting training and assistance.
A city is placed in fiscal emergency if any one of the six conditions described in Section 118.03 of the Ohio Revised Code exists. The six conditions are: 1) default on a debt obligation; 2) failure to make payment of all payroll; 3) an increase in the minimum levy of the city which results in the reduction in the minimum levy of another subdivision; 4) significant past due accounts payable; 5) substantial deficit balances in city funds; and 6) a sizeable deficiency when the city’s treasury balance is compared to the positive cash balances of the city’s funds.
A full copy of this fiscal emergency declaration may be accessed online.
The Auditor of State’s office, one of five independently elected statewide offices in Ohio, is responsible for auditing more than 5,800 state and local government agencies. Under the direction of Auditor Dave Yost, the office also provides financial services to local governments, investigates and prevents fraud in public agencies and promotes transparency in government.