One little word that was overlooked at first will help bring thousands of dollars in annual income taxes back to Ironton.

When it went into effect July 1, it appeared that Boyd County, Ky.'s new 1-percent payroll tax would cost the city more than $65,000 a year because Ironton residents who work in Boyd County would pay that tax instead of the city's 1-percent tax.

Employees pay an income tax where they work, but if there is no income tax there, they pay in the city where they live. Because of a state reciprocal agreement, the city thought it would have to honor this by forfeiting its 1-percent tax on individuals working in Boyd County, Fin-ance Director Cindy Anderson said.

Anderson recently asked the city attorneys to review this reciprocal agreement again. This time, they saw that the Ohio law outlining the reciprocal agreement says the city must do so with a municipality, but because this is a county tax the law does not apply, she said.

Several large businesses in Boyd County such as Ashland Oil Inc., AK Steel, the Big Sandy Electric Plant and the federal prison employ many Ironton residents.

Because several of the companies have already stopped withholding taxes for the city, Anderson said they will have to contact the individuals personally.

While some may be hard to get, Anderson said she expects to have all of the funds accounted for next year instead of this year as would have been the case without the tax.

Finance committee declines to recommend budget revisions

In other business, the 2003 budget again dominated discussion as the finance committee declined to recommend a budget revision despite Anderson's pleas that it is badly needed.

As always, budgets are made on projections, and it is not uncommon for them to need to modify several items during the year, the finance director said.

"This year, it was requested that we tighten the budget down," Anderson said. "We tightened down a little too far. We need some type of revision because we haven't done one all year. Some departments like the wastewater department do not have any money left."

The mayor tried to encourage finance committee members to recommend the revisions to council, saying that the budget still shows a good carryover and is as good as any in the last few years.

"We typically do this two or three times a year. It usually hits around June or July, then around September and then again in November," he said,

"What we are looking at tonight is a budget getting its first revision of the year, so you are seeing nine months of changes all at one time."

Finance Committee members Brent Pyles and Richard Price both questioned several issues and said they still have too many concerns about what caused the problems and how they can be avoided in the future to adopt a revision.

"I still have some unanswered questions here and I have made it clear I need to know what we are going to do now and down the road to control expenditures that are more than we expected in critical areas," Pyles said.

"I still haven't heard any answers."

Last month, Anderson presented a draft of an appropriations ordinance that projected the city's budget through the end of the year. Overruns in two city departments - the health department and the police department - were the focus.

Anderson handed out a modified version of this Thursday that included the latest changes.

Overall, the latest figures projected nearly $200,000 more revenue in the general fund than was originally budgeted. These figures reflect the Boyd County tax ruling and fact that the city will receive approximately $180,000 more in estate/inheritance tax.

The newest revision, proposes transferring an additional $24,400 to the Health Fund, because the health department's lack of revenue has remained a big part of the recent discussions.

Finance Committee chairman Jesse Roberts called another meeting for 6 p.m. Tuesday.

Last month, Dr. Jim Milleson, president pro-tem of the Health Board, explained why the department's expenditures might be more than its revenues.

First, the projections may be inaccurate because the health department brings in most of its revenue during the last quarter of the year, because of athletic physicals, shots, screenings and vaccinations, he said in September.

He outlined several contributing factors, including a miscommunication in scheduling for the past nine months that has allowed the department to offer clinical services only three days a week instead of five days, health problems by key personnel, a $5,400 increase in basic operating expenses, the dissolution of the Help Me Grow program and its $3,600 in funding and the $11,000 buyout for the retirement of Charlie Kouns, former registered sanitarian and health commissioner.

Pyles and Price asked Milleson Thursday about specific changes the department had planned.

"From the standpoint of the health department, we addressed several issues and also have a few more to address in executive session to curb expenditures and better benefit revenues," Milleson said.

Based on discussions he had Thursday with Ohio Department of Health officials who were telling him audit results, Milleson suggested that the department may actually be putting too much emphasis on revenue producing services and should expand services on education, training and licensing in the food service operations and sanitary work, which may require additional funding from the city.

Because the issue first came up there have been differing opinions on the interpretation of the Ohio Revised Code in regards to funding the health department. The question remains whether or not the council must provide additional funds to help the health department finish in the black or has council already met the requirements of the by funding the department initially.

Former Health Commissioner Kouns has always maintained that the health department is there to serve the public good and "does not have to bring in a dime."

The Ohio Revised Code, section 3707.28 states:

"When expenses are incurred by a board of health under Section 3707.01 to 3707.53, inclusive, of the Revised Code, upon application and certificate from such board, the legislative authority of the municipal corporation shall pass the necessary appropriation ordinances to pay such expenses."

City attorneys Mack and Robert Anderson issued a legal opinion on March 22, 1999, that addressed the issue.

"It is our opinion that the foregoing section requires the legislative body of the City to provide the full budget request made by the Board of Health, when such a request is properly and timely submitted, so long as all items in the budget request are to carry out the duties and responsibilities of the Board of Health as authorized by Ohio Revised Code Chapter 3707," the letter stated.

So the question remains, what does this mean locally and does council have to fund the department now?

Jay Carey, director of public affairs for the Ohio Department of Health, said this is an issue that comes up from time to time and is really left up to the local governments.

"There is no definition under state law of what 'properly and timely submitted' means," he said. "Because Ohio is a (locally) ruled state, it really needs to be decided by a local entity."

The city's budget expires on Dec. 31, the end of fiscal year. No city department can be in the negative balance at the end of the year or the state can declare the city in a fiscal emergency. This has not happened since 1980.