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City of Fostoria Placed in Fiscal Emergency
Columbus – Auditor of State Dave Yost placed the City of Fostoria in a state of fiscal emergency today as a result of deficit fund balances.
At the request of Mayor Eric Keckler, the Auditor of State’s office initiated a fiscal analysis of the city to determine if its financial condition justified the declaration of a fiscal emergency. The Auditor’s Local Government Services Section (LGS) determined that the city is in a state of fiscal emergency due to deficit fund balances totaling $12,563 and $505,330 as of December 31, 2015, and February 29, 2016, respectively.
“The City of Fostoria will have to make some tough choices to regain stable financial footing,” Auditor Yost said. “My office is ready to offer all the guidance it can to help the city get back on its feet.”
The City of Fostoria will now come under the oversight of a financial planning and supervision commission. Within 120 days of its first meeting, the commission must develop a plan to eliminate the fiscal emergency conditions. The Auditor of State serves as the “financial supervisor” to the commission.
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:
- Default on a debt obligation;
- Failure to make payment of all payroll;
- An increase in the minimum levy of the city which results in the reduction in the minimum levy of another subdivision;
- Significant past due accounts payable;
- Substantial deficit balances in city funds; and
- 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 is available 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.
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