Former Democratic city council member John Cranley is kicking off his 2013 mayoral campaign by getting involved in budget talks. In a public hearing at City Hall last week, Cranley tried to provide an alternative to privatizing the city’s parking assets, which City Manager Milton Dohoney has suggested to pay for $21 million of the city’s $34 million deficit.
“It’s not the citizen’s job to balance the budget, but let me make it very easy for you,” Cranley said. “You have $12 million in casino money that can be used but is currently being used on pet projects, like street sculptures. The parking meters themselves produce $7 million a year. That’s $19 million. And $5 million for garbage cans. That’s $24 million. You only need ($21 million) to cancel the parking privatization plan, so I got you $3 extra million to spare.”
In short, Cranley's alternative to parking privatization is using $12 million from casino revenue, $7 million from keeping parking meters under city ownership and $5 million saved from not purchasing trash carts.
So how viable are Cranley’s ideas? In a memo, Dohoney’s
office responded. The memo points out that casino revenue is currently
estimated at $7.2 million, not $12 million, and $1.3 million is already
included in the budget for Focus 52, a neighborhood redevelopment project. That leaves casino revenues $6.1 million short of what Cranley proposed.
Regarding parking meters, Dohoney’s office says revenue
from parking meters is restricted to fund “operations and maintenance in
the right-of-way.” The memo says City Council could authorize using the money to plug the deficit, but it would then have to find
alternatives for funding operations and maintenance.
Even the trash cart proposal doesn’t work. Not buying trash carts would only save $4.7 million, not $5 million. And the plan, which is part of the city’s effort to semi-automate trash collection, is in the general capital budget, not the general fund operating budget that’s being debated. The memo concludes, “If the trash carts are not purchased, the funds would not be available to close the gap because this is a capital budget expenditure and resources supporting the capital budget cannot be used in the operating budget.”
In other words, Cranley’s “very easy” budget plan isn’t just difficult; it’s a mix of inadequate and impossible. If CityBeat was PolitiFact, Cranley’s suggestions would probably get him a “Pants on Fire” label.
Libertarian mayoral candidate Jim Berns today pronounced his campaign dead and claimed local media, including CityBeat, is to blame.
“From day one, the Cincinnati Print Media (especially the Enquirer) have thrown Libertarian candidate for mayor, Jim Berns, under the bus,” Berns wrote in an email, listing Carl Weiser, Jane Prendergast, Ryan Hoffman and Ben Goldschmidt of The Cincinnati Enquirer, Howard Wilkinson of WVXU, German Lopez of CityBeat and Chris Wetterich of The Business Courier as the main culprits.
In the email, Berns complains that the two frontrunners in the mayoral race — Democrats Roxanne Qualls and John Cranley — have nearly identical records. Those candidates’ biggest points of disagreement are the streetcar and parking plan, both of which Qualls supports and Cranley opposes.
The email claims the media should call Berns “courageous, innovative, a real choice” instead of a “perennial candidate.”
Berns then attached this picture:
The latest stunt is just one of many that have been part of Berns’ campaign.
On July 31, Berns declared he was quitting the mayoral race in protest of the city’s primary system, which Berns says favors Qualls and Cranley. A day later, he changed his mind and said he’s back in.
On June 4, Berns, who supports marijuana legalization, said he was going to hand out free marijuana plants at a campaign event. The gifts turned out to be tomato plants, not marijuana.
In general, the Libertarian’s campaign has focused a lot on giving stuff away. His campaign card proudly touts his intent to give out free ice cream, which he has repeatedly done at events.
As a Libertarian, Berns supports lower taxes and smaller government and opposes drug prohibition. He was endorsed by the conservative Coalition Opposed to Additional Spending and Taxes (COAST).
Cincinnati is generally considered a Democratic stronghold, which has kept Berns’ chances of winning the mayoral race very low. The city hasn’t had a non-Democratic mayor since Charterite Arnold Bortz left office in 1984. Back then, the local Democratic Party and the Charter Committee were working together through a coalition.
The company in charge of building Cincinnati's streetcars says the city would incur substantial costs if it cancels the streetcar project after it's already gone through some construction and design work.
The Nov. 30 letter from CAF USA Vice President Virginia Verdeja to former Mayor Mark Mallory arrived just one day before Mayor John Cranley, who opposes the streetcar project, and an anti-streetcar majority were sworn in.
"CAF will have to recover all the incurred expenses as well as all the additional cost of cancelling the contract, which would be substantial too," Verdeja writes in the letter.
The letter explains that, on top of the sunk expenses on design work, cancellation would require CAF to pull back on various established deals with subcontractors, which would spur further costs.
For streetcar supporters, the letter renews fears of litigation that could crop up if the project were canceled and contractors decided to pursue their full payday. Those legal costs would fall on the already-strained operating budget that pays for day-to-day services like police and firefighters instead of the capital budget that finances big capital projects like the streetcar, according to city spokesperson Meg Olberding.
On Nov. 21, Streetcar Project Executive John Deatrick warned the costs of canceling the $132.8 million streetcar project could nearly reach the costs of completion after accounting for $32.8 million in estimated sunk costs through November, a potential range of $30.6-$47.6 million in close-out costs and up to $44.9 million in federal grant money that would be lost if the project were terminated.
Earlier on Sunday, hundreds of streetcar supporters rallied in Washington Park and walked the planned streetcar route in support of the project. They're threatening a referendum if the new City Council moves to pause or cancel the project.
City Council plans to vote on pausing the project on Monday. Because of threats from the federal government that a mere delay could lead to the loss of federal grants, streetcar supporters claim a pause would equate to cancellation.
Read the full letter below:
Updated at 6:13 p.m. with the PDF of the letter.
Despite promising to
move on after he failed to cancel the $132.8 million streetcar
project, Mayor John Cranley continues criticizing the
project in interviews and social media.
Most recently, Cranley appeared on Local 12’s Newsmakers program and threatened
to eventually replace the Southwest Ohio Regional Transit Authority (SORTA)
board, which manages local Metro bus services, in response to board members’
defunct offer to take up streetcar operating costs. (City Council sets SORTA
appointments, not the mayor.)
“The fact is they were
willing to cannibalize bus service,” Cranley said,
contrary to SORTA’s insistence that their offer would not have affected bus
services. “I just felt that was a huge violation of what SORTA is supposed to
be about and what Metro is supposed to be about and what public transportation
is supposed to be about.”
Throughout the 24-minute
interview, Cranley referenced the
streetcar project when discussing the city’s parking meters and other subjects
— a continuation of repetitive anti-streetcar tactics Cranley
deployed on the campaign trail and in mayoral debates against former Vice Mayor
“I think the project is
wasteful and not worth the investment,” Cranley said
when asked about the project. “I think we would have been better off making the
hard decision to cut bait.”
Still, Cranley later added, “Obviously, since the supermajority of
council went against my wishes, I have to respect the process. So I’m not going
to try to sabotage the streetcar.”
The interview also
follows comments on social media. After the former head of the Cincinnati Art
Museum criticized the streetcar, Cranley tweeted on Dec. 27, “(N)ow some Orwellian commentators
will say art director not ‘progressive.’”
The continued anti-streetcar rhetoric comes despite promises to move on that Cranley made after Councilman Kevin Flynn announced he would provide the final vote needed to veto-proof City Council’s decision to continue the streetcar project.
“As I tell my son when he doesn’t get his way, it’s time to move on,” Cranley
said on Dec. 19.
heated rhetoric is nothing new in his campaign against the streetcar project.
After the Nov. 5
election, Cranley told The Cincinnati Enquirer
the streetcar debate “is over.” Cranley’s comments
marked a high level of confidence after voters elected a mayor and council
supermajority that seemingly opposed the streetcar project, but his statement
to The Enquirer proved to be wrong after Council Members Flynn, David
Mann and P.G. Sittenfeld decided to continue the
Cranley also called city officials “incompetent” after
they projected that canceling the streetcar project would cost nearly as much as
completing it. Once again, Cranley’s comments proved
to be wrong — an independent audit found city officials were largely correct in
their assessment — but still showed the level of confident, heated rhetoric
that follows the mayor’s campaign against the streetcar project.
At the very least, Cranley’s rhetoric proves that while the policy debate over the streetcar is over for now, the public discussion is not. The question is whether the messaging will work as the project moves forward and the streetcar becomes a reality of Cincinnati.
Mayor Mark Mallory last
night announced during his State of the City address that the city
has chosen the model and vendor for the first batch of streetcars.
The mayor's office today released details about the vendor, along with renderings of the streetcars Cincinnatians can expect to see traversing the 4-mile
loop that will cover 18 stops connecting The Banks, Government Square, Fountain
Square, Broadway Commons, the Gateway Quarter and Music Hall.
According to the release,
the vendor, CAF USA, has produced light rail vehicles for Pittsburgh,
Sacramento and Houston and streetcar vehicles for the international
cities such as Besançon and Nantes, France; Belgrade, Serbia;
Antalya, Turkey; Stockholm, Sweden; Edinburgh, Scotland; and Spanish
cities Zaragoza, Granada, Sevilla, Bilbao and Vitoria.
Officials in February broke ground the Cincinnati Streetcar system, and the city hopes to add additional phases connecting the Uptown area near the University of Cincinnati once funding is secured.
The following are renderings released by the city:
The streetcar project’s chances of survival grew on Thursday after Mayor John Cranley announced he’s willing to allow the $132.8 million project move forward if the annual operating costs for the streetcar are underwritten by private contributors.
But streetcar supporters might have as little as one week to provide assurances to Cranley that the operating costs can be underwritten by the private sector, given the federal government’s Dec. 20 deadline for up to $44.9 million in grants financing roughly one-third of the project.
Still, a representative of the Haile Foundation, a major private contributor to city projects, said private-sector leaders are already working on meeting Cranley’s offer and solving the issue.
The concern for Cranley — and even some streetcar supporters — is that annual operating expenses for the streetcar would hit the city’s already-strained operating budget, especially if the annual operating expenses are higher than the previous estimate of $3.4-$4.5 million.
Although the city wouldn’t need to pay for the full operating costs until the streetcar opens for service in 2016, Cranley and some council members are concerned finishing the project now would force the city to make payments it won't be able to afford in the future.
“We know the streetcar is a very expensive project,” Cranley said. “This community cannot afford a new, ongoing liability that goes on forever.”
Streetcar supporters argue Cranley’s view misses the streetcar’s potential for economic development, which could bring in more city revenues as more people move and work in the city.
The streetcar project would produce a 2.7-to-1 return on investment, according to a 2007 study from consulting firm HDR that was later verified by the University of Cincinnati.
Councilman Kevin Flynn, one of the two potential swing votes on council, said Cranley’s offer could provide “a way forward.” He previously told CityBeat that the operating costs remain a prominent concern for him because they could translate to cuts in the city’s budget, particularly to police and firefighters.
Eric Avner, vice president and senior program manager of community development at the Haile Foundation, called the deal “an olive branch” to streetcar supporters. He said he’s “very, very confident” the private sector will be able to find a solution.
“I don’t think we can solve it in a week. What I heard is he needs assurances,” Avner said.
Cranley said he doesn’t expect someone to come to city leaders next Wednesday with a check paying for 30 years of operating costs, but he said the commitment has to be serious and long lasting for the city to move forward with the streetcar.
Avner discussed bringing together a commission of private-sector leaders with some long-term assurances.
In what he described as an “organic” movement, Avner said he’s heard from various private-sector leaders that they want to keep the project going, but he claimed most of them don’t want to engage in a public “food fight” that could hurt their relations with the mayor and other city officials.
For Avner, it’s a matter of sticking to a project that’s already well into development and construction.
“We don’t have the luxury to waste that kind of money in this town,” he said.
Streetcar Project Executive John Deatrick on Nov. 21 told council members that canceling the streetcar project could save only $7.5-$24.5 million in capital costs after accounting for $32.8 million in estimated sunk costs through November, $30.6-$47.6 million in close-out costs and up to $44.9 million in federal grants that would be lost if the project were stopped.
After Cranley’s announcement, Councilwoman Yvette Simpson questioned Cranley’s motives and said the solicitation might be very difficult to meet in just one week.
Cranley said he’ll reach out to the Federal Transit Administration to try to get an extension, perhaps until the end of the year, on the deadline for federal grants.
“It’s obviously a huge, huge hurdle to try to pull this together in seven days,” Cranley said.
Cranley cautioned he wouldn’t be upset if his offer fell through. Flanked by union representatives for police, firefighters and other city workers, Cranley reiterated that his priorities still lie in basic city services.
Councilman P.G. Sittenfeld previously proposed setting up a special improvement district to pay for the operating costs. But Cranley called the approach unworkable because it would require property owners to opt in — an effort that would presumably take much longer than one week.
Cranley’s announcement came as streetcar supporters move to place a city charter amendment in support of the streetcar project on the ballot. The campaign vowed to gather 12,000 signatures by the end of the week.
Mayor Mark Mallory announced revisions to the city manager’s budget plan today that will reduce the amount of layoffs by making several additional cuts, particularly in funding that goes to outside agencies, and using recently discovered revenue.
Mallory’s changes will restore 18 firefighter positions, 17 police positions, three inspector positions at the Health Department and two positions at the Law Department, reducing the total layoffs to 161, with 49 of those being police positions and 53 being firefighter positions.
To balance out the restored positions, the mayor is suggesting closing down two more recreation centers: Westwood Town Hall Recreation Center and Mt. Auburn Recreation Center. He is also suggesting cuts to the mayor’s office budget ($32,000) and outside agencies ($1.3 million), including the Cincinnati Center City Development Corporation (3CDC), the Greater Cincinnati Port Authority, the Center for Closing the Health Gap, the Cincinnati USA Regional Chamber of Commerce and the African American Chamber of Commerce.
Mallory’s revised budget plan also makes use of about $500,000 in revenue that was not located in time for City Manager Milton Dohoney’s budget proposal.
Mallory justified the cuts by saying public safety must come first, but he says he would keep the funding under better circumstances.
“The progress we have seen in our city cannot stand on its own without an emphasis on public safety,” he said.
The budget will have to be enacted by June 1 to give the
city 30 days to implement the changes before fiscal year 2014, which
begins July 1. It will now move to City Council, which will be able to make its own changes.
Mallory stressed that the city’s $35 million operating budget deficit is being driven by a few outside factors, including reduced state funding, court challenges holding up the parking plan and the recent economic downturn.
Gov. John Kasich has cut local government funding by about half in his state budget plans, which Dohoney estimated cost Cincinnati about $22.2 million in 2013 (“Enemy of the State,” issue of March 20).
The city was planning to make up for some of that lost funding by leasing its parking assets to the Port Authority and using the funds to help balance the deficit and fund development projects around the city, including a downtown grocery store (“Parking Stimulus,” issue of Feb. 27). But opponents of the plan, who say they are cautious of parking rate hikes and extended parking meter hours, have successfully held up the plan in court and through a referendum effort.
Cincinnati’s population has steadily decreased since the 1950s, which means the city has been taking in less tax revenue from a shrinking population. That was exacerbated by the Great Recession, which further lowered tax revenue as people lost their jobs and cut back spending.
Still, the city has run structurally imbalanced budget since 2001, according to previous testimony from Budget Director Lea Eriksen. The previous budgets were balanced through one-time revenue sources, but Dohoney told media outlets last week that, barring the parking plan, those sources have run out.
Cincinnati could lose up to $45 million in federal funds if it cancels the $133 million streetcar project, according to a new letter from the Federal Transit Administration released on Thursday by Mayor Mark Mallory.
The letter confirms much of what was stated in a previous June 19 letter to Mallory, and it presumably acts as a warning to Mayor-elect John Cranley, who intends to permanently cancel ongoing construction on the streetcar project once he takes office in December.
Cranley previously said he could lobby the federal government to re-appropriate the money to other projects, but the FTA letter unequivocally states the money is only for the streetcar project.
“FTA’s oversight contractor for the Project informs me that the City’s expenditures plus committed costs on the Project as of this date exceed $116 million, which is approximately 88 percent of the total project cost,” wrote FTA administrator Peter Rogoff. “These commitments include many construction activities that cannot be easily reversed — the City has relocated utilities, embedded rail in City streets, and purchased streetcars. Should the City choose to prematurely terminate the Project, all cost associated with closing down the project, including any claims from the contractors, will not be eligible for any federal reimbursement.”
The letter confirms that, as CityBeat originally reported, canceling the streetcar project carries its own costs.
Should the city cancel the project, it would first need to return nearly $41 million in federal grant money. The remaining $4 million in federal funds would fall under the discretion of Gov. John Kasich, who could shift the money to other parts of Ohio.
City spokesperson Meg Olberding previously told CityBeat
the city already spent $2 million of the federal funds. Olberding said the $2 million in repayments would need to come out of the operating budget
that pays for cops, firefighters and human services instead of the
capital budget that’s currently financing the streetcar project.
Since the operating budget has been structurally imbalanced since 2001, adding millions in costs could force the city to cut additional services or raise taxes.
Upon cancellation, the city would also need to pay back some of the $94 million in standing contractual obligations for the streetcar project. In many cases, the obligations reflect supply orders and other expenses contractors and subcontractors already took on but haven’t officially billed to the city. If the project were canceled, city officials say the already-spent money would need to be paid back, along with extra costs to close the project — to repave torn-up streets, for example.
Project executive John Deatrick previously told CityBeat that paying back the contractual obligations could involve litigation, which would also be paid for through the operating budget, as the city tries to minimize cancellation costs and private contractors try to recoup as much as they can from the project.
All of that is on top of the $23 million that’s already been billed to the project as of September, which should grow by $1.5 million each month as contractual obligations are turned into official bills, according to Deatrick.
The final decision on the streetcar project rests on City Council. Cranley told The Cincinnati Enquirer on Thursday that he’ll pursue a 30-to-90-day time-out on the project as the city conducts a full accounting of cancellation costs, completion costs and the potential return on investment of the project, following requests from Councilman P.G. Sittenfeld and incoming council members David Mann and Kevin Flynn — three crucial swing votes in the newly elected council of nine — for more information before placing a final vote on the project.
The talk of cancellation already spurred some Over-the-Rhine residents and businesses to launch a campaign to save the streetcar. Cranley insists it’s too expensive and the wrong priority for the city, but supporters tout independent studies and their own experiences to argue it would spur economic development. The pro-streetcar group will meet on Thursday at 7 p.m. at the Mercantile Library, 414 Walnut St. #1100, downtown Cincinnati.
The full letter:
Cincinnati officials will
hold a press conference Thursday to announce that the city will receive a $3
million federal grant to address lead paint problems in apartments and houses.
The U.S. Department of Housing and Urban Development (HUD) awarded the grant to the city’s Community Development Department. City staffers will work with some local nonprofit agencies in allocating the funds.
At least 240 residential units will be able to have lead abatement completed, officials said.
Mayor Mark Mallory and City Manager Milton Dohoney Jr. will formally accept the money, which is the fourth lead-related HUD grant given to Cincinnati, in council chambers at 10 a.m. Thursday. The chambers are located on the third floor of City Hall, 801 Plum St., downtown.
Representatives from the agencies that will help the city use the money also are expected to attend. They include Price Hill Will, Over-the-Rhine Community Housing, Cincinnati Housing Partners, People Working Cooperatively, Working In Neighborhoods and the Northside Community Urban Redevelopment Corp.
Lead poisoning is the leading environmentally induced illness in children, according to the Environmental Protection Agency. At greatest risk are children under the age of six because they are undergoing rapid neurological and physical development.
The United States banned the use of lead in household paint in 1978, but it often can be found on the walls of dwellings in cities with older housing stock like Cincinnati.
An estimated 19,000 children under age six in Ohio have unsafe levels of lead in their blood, according to an analysis by the Environmental Working Group. The number includes an estimated 1,400 children in Hamilton County.