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April 17th, 2013 By German Lopez | News | Posted In: News, Budget, Streetcar

Budget Gap Threatens Streetcar Project

Vice Mayor Roxanne Qualls calls for public hearing to discuss project

quallsVice Mayor Roxanne Qualls

After years of delays and obstructionism, a Tuesday memo from City Manager Milton Dohoney Jr. revealed a $22.7 million budget gap is threatening to put an end to the streetcar project, prompting Vice Mayor Roxanne Qualls to call for a public hearing to address the issue.

In the city manager’s memo, the city says it could bring down the potential budget gap to $17.4 million with budget cuts, but the rest would have to come from new funds. The memo says the budget gap is a result of construction bids coming in $26 million to $43 million over budget.

The memo says the city will continue working with “federal partners” to find solutions, but it makes no specific proposals — a sign the project will likely require new city funds and private donations to close the gap.

In response to the memo, Qualls, a Democratic mayoral candidate who has long supported the streetcar, called for a public hearing on April 29 in a statement sent out today. The statement says part of the meeting will help clarify what would happen with allocated funding if the project fell apart.

Qualls told CityBeat it’s too early to jump to conclusions about the project’s fate, but she says it’s time to have a serious discussion about the project. “We’re at the point where we need to have a very robust public conversation about this that is based upon fact,” she says.

At the public hearing, both council members and the public will have time to ask questions. Qualls says she’s interested in getting answers for how the project got to this point, what the cost issues are, whether the streetcar is still a good economic investment and what costs are associated with shutting down the project if it’s deemed necessary.

“Fundamentally, it’s an issue of what are the costs but also what are the benefits,” she says.

“We need to clearly outline both for the public.”

But opponents, including Democratic mayoral candidate John Cranley, have responded to the budget gap by criticizing the streetcar project. Cranley, a longtime opponent of the streetcar, called for the project’s end in a statement today: “The streetcar has been a bad idea and a bad deal for the people of Cincinnati from the beginning. ... Ms. Qualls has already voted to raise property taxes three times to pay for the project. When is she going to say ‘enough is enough?”

The opposition is nothing new to the project, which has undergone multiple bouts of obstructionism, including two failed referendum efforts in which a majority of voters came out in favor of the streetcar. Qualls says these delays have only made the project’s implementation more difficult.

The streetcar is one of the few issues dividing the two Democrats running for mayor this year, making it a contentious political issue (“Back on the Ballot,” issue of Jan. 23).

The city recently approved two motions to prepare to hire John Deatrick, the current project manager for The Banks, to help bring the streetcar’s costs in line (“City Moves to Hire New Streetcar Manager,” issue of April 10). Deatrick was involved in finding savings in the streetcar project, according to the memo.

The hire and shortfall announcement came in the middle of an ongoing local budget crisis that may lead to the layoff of 344 city employees, including 189 cops and 80 firefighters. The crisis is a result of legal and referendum efforts holding up the city’s plan to lease parking assets to the Port Authority, which would have opened up funds to help balance the budget for the next two years and carry out development projects around the city, including a downtown grocery store (“Parking Stimulus,” issue of Feb. 27).

But the streetcar project, including Deatrick’s hire, is part of the capital budget, not the operating budget that employs cops and firefighters. Capital budget funds can’t be used to balance the operating budget because of legal and traditional constraints.

A statement from Cincinnatians for Progress defended the streetcar, despite the higher costs now facing the project: “These are challenging moments for Cincinnati's administration and City Council regarding the streetcar. Bids came in higher than anticipated. However, even at a slightly higher cost, the economic benefits of the system far outweigh these costs. This is a reality that has been outlined in study after study and confirmed in results from other cities across the country.

“Nearly 100 years ago, political leaders were having these same discussions before tragically losing resolve and abandoning the proposed subway and rail system that was nearly complete. Times have changed. A new attitude of positivity has taken over our city. We must continue the pattern of success that encompasses many recent projects that were difficult and not inexpensive, but well worth the investment.”

 
 
 
 
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