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Council met for its organizational meeting, in special session, at the call of the Mayor, pursuant to written Notice dated and delivered December 31, 2009, for the purpose of considering two items of legislation described in the Notice, and also to appoint a Clerk of Council and to appoint a President Pro-Tempore, with all nine members present: Ames, Cross, Lester, Malone, Patrick, Proehl, Sharp, Siberell and Trutschel. There were two media representatives and 13 other visitors present, in addition to Mayor Sulzer, City Law Director Eddy, and City Auditor Spetnagel.

Pres. Arnold inquired if there is any new business to be discussed. Mrs. Ames said that there is an addendum attached to Item #1, the ordinance to make appropriation for current expenses and other expenditures during the fiscal year beginning January 1, 2010. She said that this addendum is the listing of the 2010 capital items, and that it needs to be marked Exhibit A, and made part of the ordinance. Mrs. Ames moved and Mrs. Patrick seconded that the listing of the 2010 capital items be marked Exhibit A, and that this be made part of Item #1. All members present voted “yea” and Pres. Arnold declared the motion adopted.

Mrs. Patrick said that she has concerns with Item #1, in that it contains so many budget cuts that it will not really carry the city through the entire year. Mayor Sulzer responded, stating that he acknowledges that this appropriations budget is not sufficient to carry through until December 31, 2010. He said that during the course of the year 2010, and as additional revenues become known, it is anticipated that there can be an adjustment in the anticipated revenues by City Auditor Spetnagel, who will then be able to approve the necessary additional appropriations. He said that the budget reflects the $18,782,357.12 in estimated revenues that were made by former Auditor Morrissey. City Auditor Spetnagel also responded, stating that he does not like the present ordinance himself, with all of the cuts that were made. He said that presently the estimated revenues for the year 2010 are insufficient to pay for everything through the end of 2010. He stated that layoffs might have to be considered later in the year, and that Council may have to make additional cuts, or increase revenues, unless there are additional revenues that come in, but are presently unanticipated. Mayor Sulzer said that the carry-over balance for the year 2009 is presently indicated as being about $1,500,000.00.

Mrs. Ames said that she echoes Mrs. Patrick’s concerns. She said that we know that there are fixed expenses each year that must be met, and the present ordinance does not fully cover these. She said that the funds for the purchase of the former AEP building do not affect this budget, because they will come from the Court’s Building Fund. Mr. Sharp said that he would prefer to see City Auditor Spetnagel and Mayor Sulzer, along with the Finance Chairman, to look at the figures and the present ordinance before Council and to instead come up with their own budget. He said that as far as the former AEP building purchase goes, the city must definitely pay the additional utilities and maintenance expenses for this new building as well as for the existing buildings, so the purchase of the former AEP building does affect the budget. Mayor Sulzer said again that this appropriations ordinance can be amended throughout the year to make necessary adjustments. Mrs. Ames said that she understands that a temporary budget has more problems to it than passing the present ordinance and later amending it.

Mayor Sulzer responded, stating that although a temporary budget is possible under Ohio law, this would require the Auditor’s Office at the end of March to set a cut-off date on purchases, and to then balance the city’s books before going forward with a budget for the remainder of the year. Mr. Sharp said that he would still rather see a temporary budget for the first few months, and then have City Auditor Spetnagel present his own budget for the rest of the year. Mrs. Lester said that passing an appropriations budget at the beginning of the year is something we have done in the past, and every year Council has had to adjust the budget with new legislation to make additional appropriations. She said that she feels that Council might just as well pass this appropriations ordinance and then adjust it during the year, as indicated by Mayor Sulzer and City Auditor Spetnagel.

Mr. Siberell said that as he reviewed the budget, he noted in several places where expenses were cut, such as the fuel expenses under refuse collections, and we know that ultimately this line item will have to be increased because it was cut by about 50% from what we spent last year. He queried as to why Council does not appropriate now what Council knows we will be needing for the full year. Mayor Sulzer responded, stating that until the city gets down to the absolute minimum in its fiscal situation, the city must make these types of cuts and the city cannot cut personnel costs without running the risk of any layoffs being challenged and reversed by the Civil Service Commission, or through union contract arbitration.

Mr. Siberell inquired as to the anticipated $1,500,000.00 carry-over balance, and whether this is affected by the $625,435.95 being appropriated under Item #2 to cover the carry forward of purchase orders from the year 2009. Mrs. Patrick asked what will happen if Council votes “no” on passing this budget tonight.

Mayor Sulzer responded, stating that tomorrow he would have to furlough all non-essential city employees and basically shut down everything except emergency services. He explained that as Mayor, he cannot legally operate the city without the legal funding from Council. Mr. Sharp asked if Council cannot pass a temporary budget tonight. He said that he would prefer to see this, instead of passing what is an insufficient budget that was prepared by the former Auditor. Mr. Sharp moved and Mr. Siberell seconded that Council consider passing a temporary budget tonight. A discussion ensued as to what this would require, making it necessary for Council and Mayor Sulzer and City Auditor Spetnagel to go through the entire appropriations ordinance line by line to come up with a final draft of a written replacement ordinance, since all ordinances must be in writing. Mr. Sharp withdrew his motion, and Mr. Siberell withdrew his second.

Mr. Proehl asked City Auditor Spetnagel how soon he could begin the process of making further estimates that would allow further adjustments in the budget. Mr. Spetnagel responded that it would be from 60 to 90 days before he would have a better idea of the actual incoming revenues for the first quarter of the year. Mr. Siberell inquired as to what types of revenues might change. Mayor Sulzer responded, explaining the different types of revenues and when these amounts might be known, such as the income tax collections being better known by the 15th of April, and the local government fund allocation, which is dependent upon any increase in state revenues.

Mrs. Patrick said that she would like to see a copy of the cost allocation that was done last year.

Ord. No. 1-10, to make appropriation for current expenses and other expenditures of the City of Chillicothe, State of Ohio, during the fiscal year beginning January 1, 2010 and ending December 31, 2010 and declaring an emergency was read for the first time by title only. Mrs. Lester moved and Mr. Cross seconded that the three reading rule be suspended, placing this item on final passage. All members present voted “yea” except Mr. Sharp, who voted “nay”, and Pres. Arnold declared the rule suspended. On final passage, all members present voted “yea” except Mr. Sharp, who voted “nay”, and Pres. Arnold declared Ord. No. 1-10 adopted by a vote of 8-1.

Ord. No. 2-10 appropriating $625,435.95 for the purpose of continuing the handling of brought forward purchase orders from the year 2009, to be put on the books of the City of Chillicothe, Ohio to be spent during the year ending December 31, 2010, and declaring an emergency was read for the first time by title only. Mrs. Ames moved and Mrs. Malone seconded that the three reading rule be suspended, placing this item on final passage. All members present voted “yea” except Mr. Sharp, who voted “nay”, and Pres. Arnold declared the rule suspended. On final passage, all members present voted “yea” except Mr. Sharp, who voted “nay”, and Pres. Arnold declared Ord. No. 2-10 adopted by a vote of 8-1.

Mr. Trutschel moved and Mrs. Ames seconded that Council appoint John L. Fosson as Clerk of Council. All members present voted “yea” and Pres. Arnold declared the motion adopted.

Mr. Sharp moved that Mr. Proehl be appointed as President Pro-Tempore. The motion failed for lack of a second.

Mrs. Ames moved and Mrs. Lester seconded that Mr. Trutschel be appointed as President Pro-Tempore. All members present voted “yea” and Pres. Arnold declared the motion adopted.

Mrs. Malone moved and Mrs. Lester seconded that the meeting be adjourned. All members present voted “yea” and Pres. Arnold declared the motion adopted. Adjourned at 7:00 p.m.