Russell trustees' fiscal ideas may relate to their paychecks

Scenario 1: Your bank offers to lend you money at 4 percent interest, then offers to pay you 8 percent interest if you re-deposit that money. What would you do? A prudent, sensible answer is to borrow a large sum and deposit it as soon as possible, a no-brainer, right?

Scenario 2: Your bank offers to lend you money at 4 percent interest, then offers to pay you 2 percent interest if you re-deposit that money. What would you do? A sensible answer is to laugh at the bank and go on down the road, a no-brainer, right?

Our Russell trustees are planning to expedite a paving program for our chip and seal roads. They have been presented with scenario 2, and at least two of them are planning on taking the bank up on their offer.

The township has a surplus of almost $3 million in the bank, earning around 1.5 percent interest, yet they are planning on borrowing $700,000 at 3.65 percent interest for five years, costing the township in excess of $75,000 in interest charges.

I have discussed this issue with several residents and the only explanation we can find for why the trustees insist on borrowing money when they have a large sum of cash in the bank is rooted in the Ohio Revised Code.

In the code, the trustee annual salary is set based on the size of the township "budget." The "budget" includes all the cash on hand at the start of the year plus the anticipated tax receipts for the upcoming year. It takes about $3.6 million to actually run the township for a year, but the "budget" includes this $3 million surplus carry-over. Not co-incidentally, at the $6 million level the trustee salary gets raised.

So, by keeping this large surplus in the "budget," the "budget" goes over the $6 million level and the trustees keep their salary artificially higher than it should be....