Council president says 'future's bright' in Munhall

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Two months ago, Munhall was down to about $15,000 in its checking account. Borough officials were scrambling to secure a private loan to avoid layoffs after nearly a dozen banks had turned down requests for a tax-anticipation loan.

And former borough manager Matt Galla, who quit suddenly in June and who borough officials say was paid more than double his authorized salary, was trading accusations with council members about who was responsible for the town's fiscal turmoil.

The Allegheny County district attorney office has acknowledged it is examining "an issue" with Munhall, but has not disclosed the nature of the inquiry.

However, two council members say the town has turned a corner with last week's hiring of a permanent borough manager, Robert Callen, who presently holds the same job in Crafton. He will start in Munhall on April 15.

"I see the rest of the year as being positive," said Councilman Rick Brennan, who heads the finance committee and started his first term in January. "I see us in the next two years, three years, four years, being a little more hands-on ... as to what's going on."

Mr. Callen would not speak with a reporter following his appointment at Wednesday's council meeting and did not return a call Thursday. However, he was appointed by unanimous vote based on what was described as a solid background and lengthy experience in municipal government.

Mr. Brennan said Mr. Callen would be a "calming force."

"He's got a lot of experience running a town and ... I think it's going to be a big benefit," he said. "I'm really hoping he's going to lead us in the right direction and change the way some things have been done."

The borough should end March with just under $1 million in cash on hand, and officials say they won't need to take the $500,000 private loan council authorized last month thanks to taxpayers paying their real estate tax bills early.

"We're feeling real good about where we're at. The future's bright," council President Dan Lloyd said, adding the borough is developing marketing initiatives to take advantage of its central location in Allegheny County and improve quality of life to attract more, particularly younger, residents.

"We're not going to sit on our hands in Munhall."

An accounting firm was in the borough offices Thursday to prepare estimates for how much audits of 2011, 2012 and 2013 will cost. They're crucial to getting a firm grip on Munhall's finances and a necessary step before the borough can again collect Regional Asset District sales tax money. Because of uncompleted audits, Munhall lost about $354,000 in RAD money for the last two quarters of 2013 and first two quarters of 2014. Its 2014 budget is $6.8 million and it will make a total of $535,000 in pension contributions to its uniform and non-uniform funds this year, including nearly $200,000 that should have been paid in prior years. Those lapsed contributions have drawn the attention of Eugene DePasquale, the state auditor general, who said in February his office will resume audits of the pension funds.

Munhall also faces spiraling costs related to workers' compensation insurance, which pays the wages of employees injured on the job. The borough's former provider, Housing and Redevelopment Insurance Exchange, dropped the borough last year because of how much it was paying out in claims.

The policy was put out to bid, according to council meeting minutes from August. For 2014, the borough's premium increased to about $341,000, up $130,000 from the year before. Since 2010, the premium has roughly doubled, and Mr. Lloyd, who runs an insurance agency, expects it to go higher.

"This is one of the worst examples of abuse of workers' compensation that I've ever seen in my life," he said. "It's like flushing money down the toilet."

The borough, which has 62 employees, had eight on workers' compensation in 2010 and 2011, according to numbers provided by the borough office. In 2012, the number doubled to 16, roughly half in public works and half in the police department, before falling to 12 in 2013. This year, there is one employee out on workers' compensation.

Mr. Lloyd said he wants the borough to implement a light-duty program that could avoid putting some injured employees on workers' compensation and would allow others to come back sooner. He said the borough also needs to examine some of its practices, including having older employees work on trash trucks.

"Slinging trash is for guys that are 25 and 30, not 40- or 50-year-olds," he said. "I'm not saying people aren't getting hurt. We had a lot of legitimate injuries. That's the other half of the equation: getting safety procedures into play. .. We need to re-evaluate the way we do things."

Mayor Ray Bodnar acknowledged the workers' compensation situation has been "crazy," but didn't chalk it up to abuse.

"We had a lot of things go wrong with a lot of people," he said.

During a council meeting last month, Mr. Bodnar blamed Munhall's financial problems on a few "slimy snakes." However, in an interview he wouldn't detail whom he was referring to, nor would he discuss Mr. Galla or the accusations made against the former borough manager.

"I thought Matt Galla was the greatest thing since Iron City beer when he came in," the mayor said. "Since this has turned out to be a can of worms, I can't comment on what's going on with him."

Mr. Galla could not be reached.

Robert Zullo: or 412-263-3909. Twitter: @rczullo.

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