The Village of
RUTLANDOHIO
Tyler M. Eblin, Mayor
Notice: Department of Parks and Recreation Initiates Emergency Food Assistance Program
Office of the Clerk-Fiscal Officer
337 Main Street, Suite 106A
Rutland, Ohio 45775
Telephone: (740) 742 2121
Fax: (740) 742 0303
Elections
Fiscal Emergency
The Village of Rutland has been declared by the Ohio Auditor of State to be in a state of fiscal emergency. Your Village officials are working in close partnership with the Ohio Auditor of State and Local Government Services to prepare, adopt and implement an effective recovery plan to correct the cause of the fiscal emergency. The end goal is to overcome the fiscal emergency within two years, but no more than five years.
The Village administration has prepared this webpage to disburse information regarding the Village's fiscal emergency declaration to better inform citizens about the meaning of fiscal emergency, the cause, the date of declaration, what happens next and the Village's five-year recovery plan.
As always, and especially during the fiscal emergency period, Mayor Eblin and the Rutland Village Council encourage Village residents to participate in Village Council meetings and support tax levies in order to facilitate adequate revenue, sustain and improve services and overcome the budget deficit.
Fiscal distress in the Village of Rutland began in 2016 when the Village general fund balance dropped to negative (-) $6,388. In 2017, the negative balance increased to -$74,437. The cause: spending in excess of tax dollar revenue, or spending greater than the authorized budget. A negative balance in the Village general fund is illegal under Ohio budgetary law.
Following a change in Village administration, and as a result of more effective fiscal oversight and significantly less spending, the Village general fund's negative balance improved significantly. In 2018, the negative balance decreased to -$56,544. By December 31, 2019, Village officials had reduced the negative balance to -$44,395 and by December 31, 2020, the deficit had decreased to -$28,209.
In July 2021, Mayor Eblin and the Rutland Village Council reduced the Village general fund's negative balance to just -$5,000, approximately. Unfortunately, delinquent auditing fees owed to the State Auditor's Office amounted to more than $100,000. Overtime, the Village had been remitting a monthly payment in the amount of $100 applied to the delinquent fees; however, this monthly payment would eventually be rejected by the State Auditor's Office, who would instead desire multi-thousand-dollar monthly payments of which the Village was not financially capable.
As a result, the Village administration negotiated with the State Auditor's Office in forgiveness of the delinquent fees. A write-off proposal of $54,000 was offered by the State Auditor's Office as payment of the Village's delinquent auditing fees, with the remaining balance to be forgiven.
In August, 2021, the Rutland Village Council authorized the Village Fiscal Officer to satisfy payment to the State Auditor's Office applied to the Village's delinquent fees in the amount of $54,000. Because the payment could not legally be drawn from any other Village fund, the check was written from the Village general fund, thereby increasing the fund's deficit to -$66,000, approximately. For this reason, Auditor of State Keith Faber declared the Village of Rutland to be in a state of fiscal emergency on March 29, 2022.
Under Ohio law, fiscal emergency is a state of financial distress of a municipality (city or village) who has met one or more of statutory conditions. Those conditions include:
When the Auditor of State declares that the financial records of a Village are unauditable, and has issued a letter to the Village indicating the timeframe under which those records must be restored to an auditable condition, and the Village has failed to do so within the timeframe specified in the letter.
When the Auditor of State identifies significant deficiencies or material weaknesses over accounting and financial reporting functions, direct and material noncompliance with applicable laws and regulations, or management letter comments which, in the opinion of the Auditor of State, the aggregate effect of such reported issues has a significant effect on the financial condition of the Village.
When a deficit fund balance exists at year-end in the General Fund that is greater than one-sixth of that fund’s revenue for that year, and/or when a deficit fund balance exists at year-end in any other fund that is greater than one-sixth of that fund’s revenue for that year, and there are not sufficient resources in the General Fund that may be transferred to eliminate the deficit or in any other fund that may lawfully transfer resources to eliminate the deficit, and the condition must continue to exist at least four months after the end of the fiscal year.
Failure, for lack of funds, to make all payroll to employees that continues beyond 30 days, or a period of agreed-upon extension that can not last more than 90 days from the original time for payment.
Default of payment on any debt obligation for more than 30 days.
An increase in the inside millage by the County Budget Commission that results in a reduction for any of the overlapping subdivisions or taxing districts.
The Village of Rutland has met condition number 3 and has thereby been declared by the Auditor of State to be in state of fiscal emergency.
The Village of Rutland eliminated the conditions of fiscal emergency by adhering to its financial recovery plan, adopted by the Rutland Village Council on July 18, 2022. The plan detailed methods to reduce spending, increase revenue and meet the immediate capital needs of the municipality. Summarily, the plan, with current updates, include:
The elimination of the salaries of the Mayor and members of the Village Council. These salaries were restored in fiscal year 2024 due to the elimination of the general fund deficit.
The reduction of the police department payroll and operating budget to $6,000 annually, saving the Village approximately $11,000 in payroll and operating expenses compared to prior police department payroll and operating budgets. This budget was restored to full capacity in 2023 due to the elimination of the general fund deficit.
The use of the Law Enforcement Trust Fund for eligible police equipment and supplies.
The transfer of approximately $39,000 from the American Rescue Plan Act (ARPA) Fund to the Village general fund to compensate lost revenue.
Appropriating public funds for Village operations and services below the annual estimated revenue sources.
A sponsorship program for the Rutland Civic Center with a fundraising goal of $10,000 annually. While the Village worked to obtain sponsors, building rental and event receipts exceeded the $10,000 annual sponsorship goal.
The review and consideration of the implementation of a 1% Village income tax, estimated to generate approximately $42,000 annually in additional revenue. A 1% income tax was implemented effective January 1, 2023.
The above measures were selected following consultation with the Ohio Auditor of State's Office.