Fostoria finance committee reports $22.6 million cash, sets steps to pursue exit from fiscal emergency

The Fostoria finance committee heard an update from Finance Director Steve on cash balances and revenues and approved procedural steps to support the city’s planned petition to exit fiscal emergency.

Finance Director Steve told the committee the city had $22,600,000 in bank deposits as of July and that staff have issued about $6,700,000 in purchase orders that will become invoices. “From a cash standpoint, we are doing well,” Steve said. He also said income tax receipts were at 62% of forecast — ahead of the committee’s 58% benchmark — and that EMS revenues were at about 70% of the forecasted $500,000 figure. Water revenue was roughly 62–63% of forecast. Steve said a sewer accounting conversion has not yet been posted and that staff expect to journal between $250,000 and $300,000 from the sewer fund into the stormwater fund; the stormwater fund currently shows about 8% of forecast.

The director described current investment and banking activity: the city is keeping more funds in a WesBanco money-market account because it is matching the return of STAR Ohio, and recent interest rates have been over 4% (about 4.58% last month, down from a peak of roughly 5.2% last year). He reported receiving seven banking proposals in response to a request for proposals; he plans to narrow those to three finalists for demonstrations of online tools, fraud-prevention features and other services, and said he expects to return to the committee with a recommendation at the Sept. 2 meeting.

The committee also discussed a correction to tonight’s legislation: the Fire Donation Fund amount listed in the packet contained a typo — the correct donation amount is $10,000, not $15,000 — and the council clerk was given an updated version to use if the council approves the item.

On the city’s fiscal-emergency status, Steve and committee members summarized the Financial Planning and Supervision Commission’s July 23 discussion about beginning the petition to exit fiscal emergency. The commission plans to use the city’s 12/31/2025 financial position if it votes to start the petition process at its Dec. 10 meeting. Steve said the auditor of state does not commit to a fixed timetable but that the review and verification steps typically take roughly six to nine months and that staff expect the state to revisit accounting and internal control practices as part of the exit review.

To meet that timeline, the committee agreed that the council will need a budget work session in November so staff can finalize the 2026 budget and the updated financial recovery plan before the Dec. 2 council meeting. During the committee meeting members moved and approved a motion to suspend the November 18 finance-committee meeting to free up the schedule for the November budget work session; the roll-call vote recorded Mr. Podak, Mr. Cassidy and the presiding committee member as voting yes and the motion passed. Committee members discussed that suspending the three-meeting rule may be needed so council can act on the budget and recovery plan at the Dec. 2 meeting before the commission’s Dec. 10 action.

Committee members proposed drafting two formal reserve policies to prevent a recurrence of fiscal distress: a general-fund carryover policy establishing minimum or target fund balances and an enterprise-fund policy for water and sewer that would set reserve guidance and rate-adjustment considerations. Mr. Podak said such policies would help future leaders maintain stability and avoid large, abrupt rate increases; another committee member said small, incremental rate adjustments are easier for households to absorb than large ones later. The committee agreed to develop draft policies and to review them at a future meeting.

On banking proposals, Steve said he will rank the seven responses, select three finalists and have staff (Carla, Kylie and Pamela) review the finalists and arrange demonstrations focused on online capabilities and fraud-prevention tools such as positive pay. “Positive pay — both on the amount and the payee — is one of the key areas we have to focus on,” he said, noting one proposal lacked that feature and would be disadvantaged in the ranking. He expects to return with a banking recommendation at the Sept. 2 meeting.

No public comments were offered on finance items, and the committee adjourned after a motion to do so passed on a roll-call vote (Mr. Bridal moved to adjourn; the committee recorded Mr. Cassidy and Mr. Podak voting affirmatively and the presiding member as well).