Cleveland: Facing Collapse?

The treasury is as bare as the school board president's bottom

The mayor was vacationing at a secret hideaway last week, recuperating from an ulcer attack. The president of the school board was fined $115 in court for flashing his bare bottom from a car window. The city council president and five other councilmen have been indicted on charges of accepting kickbacks from carnival operators. The city faces bankruptcy and can only pay its policemen for another week.

The city is Cleveland, home of a famed symphony orchestra, a first-rate art museum and 25 major corporate headquarters, a number surpassed among cities only by Chicago and New York. Most Clevelanders thought they had escaped becoming a national joke last year when they voted out Mayor Ralph Perk. He once set his hair ablaze with a welding torch while showing his affinity for the workingman during a campaign appearance at a local steel mill.

As Perk's successor, voters chose Dennis Kucinich, 32. He appointed as department heads a group of young Turks who sometimes seemed better suited for an Our Gang movie than for governing a city of 623,000 people. The Kucinich administration quickly shook up the city's business and political establishment--so badly that a recall campaign came within 236 votes of ousting him from office last Aug. 13. Now almost everything seems to be going wrong in Cleveland.

Last week the city council met in emergency session to find a way out of the city's most pressing problem: a shortage of money. According to some estimates, Cleveland is running a $16.5 million deficit and may have to default on $15 million in short-term notes that come due next month. One way out, says Finance Director Joseph Tegreene, 25, is to float a $50 million bond issue in December. But the city's credit rating is as low as New York City's was during its 1975 financial crisis.

Cleveland must also find a way to pay a $13 million debt owed to the Cleveland Electricity Illuminating Co. The privately owned utility sells power to the public Municipal Light Co., which resells it to 46,000 customers. Last spring C.E.I, got federal marshals to begin tagging pieces of city property for sale at auction to satisfy the bill. The private utility has offered to buy out Muny Light, but Kucinich has refused, arguing that it provides a competitive check that curbs rate hikes by C.E.I.

The fiscal crunch led the mayor last May to borrow almost $18 million from the water department's capital-improvement fund to pay other departments' operating expenses. But now the water system has decayed dramatically: pipes are badly corroded and a filtration plant is in danger of closing down for lack of maintenance. Two weeks ago a local court ordered the water department into receivership while a regional authority prepared to take over its operation.

After two days of debate last week, the best the city council could do was appropriate funds to pay policemen's salaries through Nov. 13 and fire fighters' salaries through Dec. 3. Said Council Majority Leader Basil Russo: "I hate to say it, but I think the city will be under the control of a receiver by the end of the year."

Money problems have aggravated friction between Kucinich and the police. Last December he replaced the department's chief with San Franciscan Richard Hongisto, a liberal defender of homosexuals' rights, who at first was widely disliked by the police but quickly gained the department's respect. Within months Kucinich fell out with the chief and fired him. Not until last week did Kucinich name a permanent successor. The mayor's choice: Jeffrey Fox, a 36-year-old former city personnel director with no previous police experience. The selection left the force seething in anger.

Another source of continuing conflict has been the mayor's relations with the city council. Black Council President George Forbes is one of Kucinich's chief opponents. Now Forbes, along with the five other council members, four of whom are black, has been indicted on charges of accepting kickbacks from local carnival owners in exchange for city permits to operate. Forbes admits taking $4,000 from them but maintains that he gave the money to charity. Fearing that the indictment might inflame racial tensions in the city, white political leaders and businessmen quickly rallied behind Forbes and began raising money for his defense.

Cleveland's school system is in at least as much trouble as the municipal government. Having managed for two years to delay obeying a federal court's orders to desegregate city schools, which are roughly 60% black, the school board last week voted to sell some 28 vacant school buildings and 20 parcels of land to raise $2.5 million to buy 80 buses--enough to transport 8,500 of the city's junior high school students. To add to the school board's problems, its 27-year-old president, John E. Gallagher Jr., was convicted in municipal court last week of disturbing the peace. While riding in a car on a highway southwest of the city, he had flashed his bare buttocks at his brother, who was in another car. Gallagher called the adolescent episode "a silly mistake."

The city's business and civic leaders are trying to rebuild the city's image with a $4.3 million promotion campaign. TV, radio and magazine ads have been prepared around the slogan, THERE'S A WHOLE NEW GENERATION IN CLEVELAND, AND WE'RE BUILDING A WHOLE NEW TOWN. But the current wave of bad news has caused one of the campaign's chief fund raisers, Art Modell, owner of the Cleveland Browns football team, to temper his boosterism. "Let's face it," say: Modell, "you can't talk about the great cultural assets of Cleveland when the city looks like it's going bankrupt."

This file is automatically generated by a robot program, so viewer discretion is required.