Galion Escapes Fiscal Emergency After More Than 14 Years

  • 10/4/2018 10:54:05 AM
  • Sartaj Singh
  • Local News

GALION, OH - The City of Galion and the Auditor of State announced on Thursday that the city has achieved financial stability. 

The financial stability was achieved by erasing $8 Million in fund deficits and addressing $4.4 million treasury deficiency. 

The City of Galion and its 10,512 residents were placed in a state of fiscal emergency on August 9th, 2004, more than 14 years ago. Two other Ohio governments in Adams County are currently experiencing fiscal emergencies of greater length. 

"It's been about 170 months since Galion set out on a strenuous path to financial recovery," Auditor Yost said. "By finally arriving at its destination today, Galion puts an end to the fifth-longest fiscal emergency in the state's history. 

To reduce the city's financial stress, officials reduced staffing levels to relieve about $386,000 in 2004 and $128,000 in 2006. The city has recalled some of the terminated employees as more financial resources become available. 

Additional savings were secured by the city by discontinuing its contributions to the Galion Community Improvement Corporation starting in 2004. Prior to the change, the city had given $194,000 to the corporation each year. More savings resulted from a three-year salary freeze for city employees. 

Voters approved a 0.5 percent continuing income tax levy in 2006 for police and fire operations. The tax levy netted more than $12.5 million in revenue. The city's total income tax rate is 2 percent. 

Other steps taken by the city were:

- Started charging a vehicle registration tax in 2007 that has generated more than $934,000 
- Issued $3.5 million in general obligation bonds in 2004. Repayment of the debt was secured through a pledge from the Egbert M. Freese Foundation.
- Implemented a cable franchise fee in 2008 that has generated more than $1.2 million. 
- Joined the Regional Income Tax Agency in 2012 to enhance tax administration and collection. 

"The citizens and leaders of Galion deserve credit for their resourceful response to this fiscal crisis," Auditor Yost said. "I urge Galion's officials to continue working toward even healthier finances with the skills and knowledge gained during this difficult journey."

The following requirements were met by the City of Galion to be released from the fiscal emergency:

- Adopted and implemented an effective financial accounting and reporting system
- Corrected or eliminated all of the fiscal emergency conditions; no new conditions have occurred, and it appears that, based on the five-year forecast, the city will remain out of fiscal emergency during the forecast period. 
- Met the major objectives of the financial recovery plan; and
- Prepared a five-year forecast in accordance with standards issued by the Auditor of State, and the opinion expressed by the Auditor of State is "nonadverse"

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