Finance Director Reports On COVID-19 Related Issues

At the Vermilion City Council meeting on Monday, June 15, 2020 Amy Hendricks, Finance Director, reported on CARES Act support for COVID-19 expenses.

“Municipal governments have been put on notice in the past week of items that need to be completed in advance of receiving any CARES Act support that will come to the state and Erie County, and eventually being transferred to the City of Vermilion for use as HB 481 passes,” stated Hendrick. “Preliminary estimates show that Vermilion will receive roughly $140,000.”

“These monies cannot be used to replace lost revenue from sources such as income tax or State fuel tax revenues,” clarified Hendricks. “It is limited in use to expenses relating to compliance with COVID-19 requirements, service continuation, etc. We have been tracking all COVID-19 expenses from payroll to purchasing since the onset using a specific account coding to easily track.”

“I participated in a conference call with other Finance Directors last week moderated by counsel from Squire Patton and Boggs discussing the regulation and compliance for funding,” stated Hendricks.

Hendricks also reported that interest rates have been dropping since the onset of the pandemic due to economic questions. Active management of the city’s available funds for investments has been a contributor to the city regaining financial stability since 2018.

“The federal reserve is not expected to move on interest rates in the foreseeable future,” said Hendricks. “Our option for short term investments has been STAR Ohio that was paying 2.48% in June 2019, 1.81% in January 2020 to the current .61% yield. Hilltop Securities, Superior Avenue, Cleveland, presented options for FDIC Insured CDs this morning that will help lock in some rates and is on the agenda this evening for approval.”

Reporting on needed technology updates, Hendricks said the ease in which impacted staff members were able to convert to working at home and back again through this initial round of the pandemic is representative of the type of technology support staff the city has engaged this past year.

“Kudos to Richard, Josh, and Hannah from Lifecare!” said Hendricks. “The transition also brought to the forefront processes that would benefit our operations or technology that could be updated. There was a need to provide laptops to a few staff members, as well as adding basic printers for home use to minimize trips into the office.”

Hendricks reported: 

1. All regular employees are now on direct deposit for payroll, with seasonal staff being encouraged to enroll.

2. They have increased the participation of vendors receiving electronic payments.

3. Utility payments made from customer’s personal online banking are now being converted to automatically deposited batches in order to eliminate handling those checks.

4. The Building Department has switched to online permit processing.

5. Departments have now embraced scanning invoices to Finance with approval for payment. 

“One need that became obvious with staff working remotely was the need to address our failing phone system,” said Hendricks. “Our IT team has been helpful in starting to plan to get that moving. Our voice mail system, call forwarding and other programmed features such as call trees no longer function effectively. We also had failure of key backbone components in the system in recent weeks that are essential to keeping support going for safety forces. Those things have been patched to get us through a limited time until we can get a new system in place.”

“This important upgrade is critical for the health and safety services we provide to citizens, but will also allow us to provide customer service at an enhanced level,” said Hendricks. “I am excited about the opportunity to allow our team to work smarter as well. 

Hendricks reminded everyone that the extended deadline for filing 2019 local income tax returns, along with 2020 estimated payments for the 1st and 2nd Quarters, is July 15.

“In planning for 2020s taxes, if you worked from home when you normally work at a location outside Vermilion, your local tax status will stay the same for 30 days after the Governor removes the Emergency declaration,” said Hendricks. “However, if you are one of the people that is now given the option to be transferred to working from home indefinitely, you may be able to eliminate paying local income tax to the city you work in and simply pay the 1.5% local income tax for Vermilion. Residents should notify their payroll department if this applies to them to initiate the change.” 

RITAs tracking has also found new cases where residents of the City of Vermilion are not filing their city tax returns. Many are in the areas of Brownhelm Township that are within the incorporated city boundaries. Indian Ridge has emerged as a new area where this is occurring. 

“In addition to messages on social media and in utility bills,” stated Hendricks, “we are continuing to provide an information sheet to residents signing up for new utility accounts, even if they are not new to the community in an effort to catch some of these. The same information is provided to applicants for any type of building permit. I have made a connection with the Lorain County and Firelands Realtor’s Associations to help get correct information out as well.”

Vermilion is enrolled again for RITAs compliance mailing program for delinquent and non-filing residents. This service is provided at no additional cost to the City. 

Hendricks reported that Vermilion has a new crop of listings showing up on the rental sites that are not registered yet for tax payments with Erie County.

“We tried to be flexible with last year with operators since it was the first year at the County and City level,” she said. “However, we expect compliance in 2020 for collection and payment. This is a tax that the operator should be collecting from guests, not an expense for them.”

“I have approached Rick Jeffries, Erie County Auditor, about the compliance service discussed recently at committee meetings,” said Hendricks. “He is very interested in the service and is open to sharing the cost as the county benefits from the revenue collected as well.”