Cleveland moved a step closer to financial disaster today when Mayor Dennis J. Kucinich's plan to avert default encountered serious opposition in the City Council with less than 48 hours remaining to find a solution.
As kucinich's cheek throbbed with tension, the council, through a straw vote, expressed overwhelming opposition to the mayorhs proposal, which would raise income taxes by 50 percent in order to restore the city's credit rating and help put its hopelessly tangled fiscal system back in working order.
Cleveland's major banks, due $15.5 million from the city by Friday, are said to be unwilling to extend these loans without the City Council's approval of the tax increase referendum proposed by Kucinich and agreement on a long-term program of stringent financial controls.
Failure of this salvage operation would make Cleveland the first major U.S. city to default since the Depression.
The straw vote fell eight votes short of approval in the 33-member council But Kucinich remained "optimistic" late today, saying he had seen such tentative votes reversed within a matter of hours on previous occasions. He has already begun negotiating individually with council members-someting he had always been unwilling to do before. "In Cleveland," he said, "we get all kinds of weather predictions but the weather always changes because we're on the lake."
Some of the mayor's supporters hoped that council members were just "tweaking" their political enemy and that, while they might take the issue down to the wire, they would ultimatley go along.
The council's tentative action was a continuation of a bitter feud with the mayor, which has dominated and sometimes paralyzed the operations of government in Ohio's largest city for months.
Kucinich, who recently narrowly survived an unprecedented recall election, has publicly called council members "buffoons" and "crooks" and has made his oppostion to them the bais of his political strength here.
Today it started to come back to haunt him at the worst possible time. Running this city "is a two-way street," said Councilman David Collier, who represents Cleveland's Hough neighborhood. "I got problems with you, mayor, and I'm going to fight you tooth and nail," Collier said at a meeting between the council and Kucinich.
Kucinich formulated his plan with little council participation. He revealed it Tuesday night in a televised speech to the city, and even then he made public only fragmentary details, omitting mention of a proposal to yeild a significant degree of city control over its own budgetary affairs to a special outside "fiscal agent".
Many council members today objected to that provision. Others said they felt they were given insufficient time to consider the mayor's proposal before the Friday deadline. Still others said they could not stomach a tax increase proposal while the rest of the country is caught up in Proposition 13 tax-cutting frezny.
Much of the opposition, however, stemmed from the mayor's refusal to raise money by selling the city-owned municipal electric power company, a badly limping utility which serves about 20,000 people but has become a political symbol for Kucinich.
Its plant is odorned with a sign saying "power to the people-Dennis J. Kucinich." Yet the plant itself is illuminated with power purchased from the privately owned Cleveland Electric Illuminating Co (CEI).
The city-owned utility stopped producing its own power two years ago.It now purchases it for itself and its customers from the privately-owned firm. The city-owned utility has gone deeply into debt because it cannot pay its bills to (CEI).
Kucinich had made his refusal to sell the linchpin of a crusade against "monopoly" interests like the the privately owned firm.
The tax increase proposal is only the first step proposed to restore the city's health.
Under the proposal a "fiscal agent," probably appointed by the state of Ohio, would oversee the city's financial affairs.
The agent would be empowered to veto city spending proposals that exceeded revenues, to enforce standard auditing procedures which have been nonexistent here and to manage city investment practices.
In addition to council approval of the referendum, most of the proposals would need the approval of the bankers and state legislature. Over the next few months, "any one of half a dozen parties-if they don't cooperate-can put us into default," Kucinich said.
The consequences of default are uncertain because there have been no major ones before. The city could borrow no money at all. Capital spending would cease. Kucinich says larll. Capital spending would cease. Kucinich says large-scale layoffs would be necessary. CAPTION: Picture, Mayor Kucinich checks notes Tuesday night before outlining salvage plan on TV. UPI