While many disagree as to the financial condition of the village of Ontonagon, most agree that the village is in debt. The question that remains, how far is the village in debt?

After holding a couple of council meetings at the Performing Arts Center, where the public could attend, the council decided to go back to holding their meetings via teleconference. The village hired Auditor Joe Verlin, who is from a firm in the Lower Peninsula. Due to the distance, he has to use Zoom in order to participate.

For over a half hour, Verlin went over the 50-plus page audit, or specific points that showed where and what the village’s financial problems were. The actual full printed copy of the audit was not given to the Gazette, however the specific points that Verlin wanted to point out were highlighted via Zoom.

Verlin agreed with the Michigan Department of Treasury letters to the village manager that one area that needs to be addressed is the village having 50 different bank accounts. An issue that the council feels they are addressing with the recent purchase of new accounting software.

Verlin also agreed with Village Manager Joe Erickson’s on-going reports dealing with the deficit of the Municipal Employee Retirement System (MERS). The MERS deficit is into the millions of dollars, again depending upon whose numbers you believe. The MERS deficit came from when the council agreed to sell the village-owned hospital, however be responsible for the retirement pension of past and current hospital employees.

According to the audit, Verlin pointed out that if the village did not have the MERS deficit, the actual deficit for the village would be a problem that could be solved by simply reducing expenses. Verlin also pointed out all the assets the village has accrued over the years.

At previous meetings, the council agreed to pay over $3500 for the tax delinquent property near the former school on Greenland Road, and paid more for the Pebble Beach Project than what was in the bid. Both of which brought on questions from council members.

The council had no questions for Verlin after his report.

After requesting to be put on the agenda for the last meeting, Sue Lockhart was given the chance to speak after Verlin’s report. While she was not allowed to question Verlin, she did ask questions of the council when it came to both the financial condition of the village and why the council did not hold another vote on the dismissal of Erickson.

At the July meeting that the council went into closed session to discuss village’s “employee matters.” After coming out of the closed session, Councilor Sarah Hopper made the motion to dismiss Erickson. She received the support from Councilor Don Chastain and Village President Tony Smydra. However, with Councilor Mike Mogen not being at that meeting, the other three council members, John Hamm, Elmer Marks, and Maureen Guzek, voted to keep Erickson. Thus it was a 3-3 tie.

According to Lockhart, she heard that Mogen was to be given the chance to call in for that meeting where the motion to dismiss Erickson would take place. Lockhart stated that Mogen never got the chance to vote.

“Why didn’t the council bring that matter on Erickson’s dismissal up when he was at the last meeting or at this meeting,” asked Lockhart.

Mogen, nor any council member would answer or address that issue.

However when Lockhart questioned the council’s lack of oversight, and made some personal allegations aimed at the council and village management, Hamm was quick to defend the village. Chastain stated that he wanted to wait till the next meeting before he made any comment as to the prepared presentation from Lockhart.

Lockhart pointed out that she has been bringing up the issue dealing with the village’s financial problems for three years, “yet none of you listened or cared to listen. Now look at the condition the village is in.”

In a letter obtained by the Gazette from the Michigan Department of Treasury, dated Aug. 10, titled “Final Notice of Delinquency,” it stated that the village has the following deficit; General Fund – $29,263.00; Marina – $134,952.00; Water – $27,285.00.

The MERS deficit was not listed.

The letter from the treasury states the law requires the village to file a financial plan with the department within 90 days of the fiscal year to correct the deficit. The letter states that the department has not received a deficit elimination plan. Under state law, the letter states, “the department will begin to withhold 25% of revenue sharing until the deficit elimination plan is submitted.”

Verlin, in his report, did state that he, Erickson, and the village are working on the plan.