Editor's Note: Aside from Mayor John Brennan, Bexley service director Bill Harvey is the person most directly involved in the day-to-day operations of the city. In the following interview, Harvey addresses the Bexley budget crisis and the importance of Issue 24, the Nov.8 ballot issue to increase the municipal income tax from 2 to 2.5 percent. Harvey's responses are unedited.

Editor's Note: Aside from Mayor John Brennan, Bexley service director Bill Harvey is the person most directly involved in the day-to-day operations of the city. In the following interview, Harvey addresses the Bexley budget crisis and the importance of Issue 24, the Nov.8 ballot issue to increase the municipal income tax from 2 to 2.5 percent. Harvey's responses are unedited.

What is the current financial situation of the city?

The recently passed Ohio budget will have a dramatic negative impact on the city. That budget eliminated about $2 million of annual income from the city, mainly by eliminating the estate tax. In addition, the slowdown in the economy over the past couple of years has hurt our income tax collections.

For the past few years, the city has been spending more to operate than it brings in. Rather than raise taxes, council and the administration opted to reduce costs and operate on our accumulated savings. Now, the excess cash is gone and the state has reduced what they give us so the only realistic alternative is to ask for a tax increase.

Why didn't the city do something sooner?

We did. We have reduced spending in a variety of areas. For example, except for the police department, staffing is down about 14 percent in the past four years. Several department heads are making less now than in 2007. Actually, our general fund expenses, after debt service and our fire contract with the city of Columbus, are roughly flat from four years ago even with normal increases. We are now at a point where additional cuts will mean a real loss in service to the community.

Besides asking for more taxes, what are you doing now to fix the problem?

Mayor Brennan has aggressively reduced costs since taking office. Expenses are down roughly $3 million in total since Mayor Brennan took office.

And we are continuing to review all expenses: salaries and benefits, staffing levels, technology usage, outside services, everything. We are also looking at ways to increase revenue. Traffic fees might be increased, for example.

But there are some things we have little control over. Our general fund budget (The general fund is the fund that pays for most city services. The city has other funds but the general fund is our primary fund.) shows us spending about $11.2 million. Of that, over $1 million is debt service - money we borrowed to pay for the new pool and the new police station, among other things. Another $1.75 million is for the Columbus fire contract. There is little we can do to change those amounts. That leaves us with about $8.5 million to pay for city services - police, the recreation department, street maintenance, snow removal, the building department, and all the other city services.

Losing $2 million from $8.5 million has a dramatic impact on what we can pay for. That is the main reason the city is asking for this tax increase.

Why don't you do what a business would do when times are tough and reduce expenses?

That is an option, however, we believe that the reduction in expenses necessary, without any new revenue, would be beyond what the residents would be comfortable with. For example, to offset the revenue from this tax increase, we could completely eliminate the staff in every department, except for police, and we would still have to make more cuts.

And, as I mentioned before, some expenses cannot be cut.

There is also something that I think people forget about the city. When a business has a downturn, it is normally because it loses customers so the business cuts staff and other expenses to offset the loss of business.

The city cannot do that. We have 13,000 residents living in 4,200 housing units. Those numbers haven't changed for probably 30 years. Even when the city revenue drops, we have to provide services to all 13,000 residents. I still have to make sure that water is delivered to each of the 4,200 homes in the city. All 42 miles of streets need to be passable.

There are about 500 fire hydrants that have to function 24/7. I don't have the option to say, for example, "My electric bill is too high so today I will not turn on the street lights on Broad Street so I can save some money." Almost everything the city does, we have to continue to do all day, every day, even when the revenue drops.

Many of our costs go up every year and I have little control over that. Fuel, asphalt, concrete, salt, utility bills all keep rising. We are constantly working to reduce our usage, but it is difficult. At some point, there is no choice but to pass these increases on as tax increases.

Are those the only options?

There are always options. We could let our streets fall into disrepair. I could cut back on snow plowing. We could reduce hours at the pool or reduce recreation services but my conversations with residents lead me to believe that residents don't want the city to do that. Most residents have indicated they would rather pay a little more in taxes than lose critical services.

We also need to increase revenue. As the economy turns around, tax revenue will increase, which will help. Also, city council and the administration, and others in the community, have been working hard to bring new businesses into the city. The development of Main Street, including the city hall site, will generate jobs and revenue. I believe that, long-term, we need more jobs in the city so we have more people contributing revenue. But that is not an overnight fix. City leaders have been working on this for years with limited success.

Some residents have complained that you are wasting money fixing streets. How do you respond to that?

We have been spending money on our streets. However, it is important to know that money is not coming from our general fund. There is a separate fund to pay for our streets. Also, a lot of the money for streets has been a combination of grants and zero interest loans from the state. Sheridan and Francis were paid for in that manner. Next year we will repair College and part of Cassady with that funding from the state.

I think it makes sense to take advantage of those state programs which are designed to help communities like Bexley handle major expenses like street repair. The state provides a combination of grants and zero interest loans for major repairs. We then pay the state from the street fund so there is no impact on the general fund.

Finally, council agreed a couple of years ago to borrow money so we could catch up on our street repairs. None of that money comes from the general fund. It is not part of the debt service mentioned above. I do think it makes sense to do that for a couple of reasons.

First, we can repair the streets at today's costs rather than higher prices in the future. Second, I believe potential new businesses and new residents notice street quality. Having nice streets and good curbs will help attract new businesses and keep our housing values high. Finally, I am coordinating the repair of the streets with the repair of our water lines. Hopefully, by repairing water lines at the same time we repair a street, we can reduce the number of times we have to dig up a street later.

So you think the tax increase is critical?

Absolutely. Our recent budget cuts impact areas that residents will notice. If the tax fails, services will be cut in all areas – and they will be dramatic. As I indicated earlier, cutting an additional $2 million or more of $8.5 million is extreme. There will not be an area of city services that will not be affected: recreation, police, the service department, everything will be impacted if the tax increase fails.

I would like to urge every resident to vote for the tax increase. As difficult as it is, I think it is necessary to allow the city to provide the services residents want.