Outgoing Mayor Denies Cleveland Finances Are Depleted

By PAUL SINGER, Associated Press Writer

CLEVELAND (AP) - Outgoing Mayor Michael R. White (pictured, right) denied on Thursday that his successor will inherit a city beset with financial troubles.

He said that Jane Campbell will take office Monday with about $28 million in unspent city funds. That includes $11.8 million that White said is left over from the 2001 budget and $16.5 million in two rainy-day funds.

White flatly denied recent news reports that said, citing city records, that Cleveland would carry over only $29,000 from 2001.

"Money in hand, dollars in the bank, in the reserve and in the general find -- $28.3 million," White said. "Any way you look at it, Mayor-elect Campbell is very well positioned from a financial perspective."

Campbell spokesman Rodney Jenkins said the incoming mayor appreciates White's work on city finances. Nevertheless, Jenkins said that her first task will be to review all financial records.

He said that Campbell does not yet have full details of the city budget.

"Finances are the primary basis for everything she can and cannot do," Jenkins said. "It is a major concern for the mayor-elect that she really does not know what is there."

White began 2001 with $16 million left over from 2000. The city cut costs last year, including instituting a hiring freeze, reducing low-priority purchases and cutting postage and training expenditures.

White noted Thursday that in his 12 years as mayor, the city never had to raise taxes to balance the budget.

"I can report with clear certainty that the city of Cleveland should not need a tax increase in the year 2002," he said.

In August, the state released an audit that was critical of the city's financial management practices. State Auditor Jim Petro said that the city made $4 million in duplicate payments to contractors in the first half of 2001; had lost track of more than $1.5 million in auto parts from city garages; and had failed to reconcile bank accounts with cash on hand.

Nevertheless, White said he is confident in the budget numbers that he released Thursday. Frank Badalamenti, the mayor's financial audit director, said that since Petro's audit, the city has reconciled its bank accounts and its budget figures are reliable.

White and Badalamenti said that they had resolved 80 percent of the findings in the state audit, and that the remaining findings were procedural or structural concerns that the White administration did not have time to address.

As required by law, White issued a proposed 2002 budget Thursday, but Campbell is required to submit to City Council a revised budget by Feb. 1.

Jenkins said that White's budget may serve as a basis for Campbell's spending plan.

"We have to work from something," Jenkins said. "Any assistance from current administration will be a help."

City Council Chairman Michael Polensek -- who has frequently sparred with White -- said, "We are hoping that what the mayor is indicating is correct, but we have no information to confirm it."

(Copyright 2002 by The Associated Press. All Rights Reserved.)