Voters on Tuesday elected John Cranley to the mayor’s office and six council members — out of nine total — who oppose the streetcar project, giving streetcar opponents enough votes to cancel the project once the new government takes power on Dec. 1.
But, as first reported by CityBeat on Oct. 9, cancellation could carry all sorts of costs with $94 million tied to contractual obligations, including supply orders and other expenses from contractors and subcontractors, and $23 million already sunk on the project.
If the city were to cancel, it would also need to return nearly $41 million in grants to the federal government, according to a June 19 letter from the U.S. Department of Transportation.
Canceling the project would cost jobs as well. About 150 laborers are currently working on the project, according to Deatrick. He says there’s also management positions involved, but he couldn’t offer an estimate for those jobs and whether they’re working on the project full- or part-time.
Deatrick says that it’s difficult to pin down how much cancellation would ultimately cost because the issue would likely be worked through litigation as the city tries to minimize cancellation costs and developers — such as Messer Construction, Prus Construction, Delta Railroad and CAF USA — attempt to maximize what they recoup from the project.
Another concern, according to Olberding, is cancellation’s impact on the operating budget. She says the roughly $2 million in federal grant money already spent on the project would have to come out of the operating budget, and litigation costs would come from the operating budget as well.
The capital budget, which is financed through bonds and other forms of debt, pays for capital projects like the streetcar. The operating budget typically goes toward day-to-day operations, including police, firefighters and human services.
The operating budget has been structurally imbalanced since 2001. If millions in litigation costs and repayments to the federal government are added to it, the city could be forced to cut services and jobs or raise taxes.
There are also concerns about how the federal government and Cincinnati’s business partners would react to the cancellation of such a major project. Vice Mayor Roxanne Qualls, Cranley’s opponent in the mayoral race, previously told CityBeat that pulling back on a commitment could break the faith developers and the feds placed in Cincinnati when they agreed to take on the streetcar project.
Cranley and other anti-streetcar elects argue the long-term costs — the $88 million in the capital budget for the current phase of the project, the cost of future expansion and $3-4 million that it would cost to operate the streetcar annually — outweigh even the costs of cancellation.
Cranley previously told CityBeat that he would help developers involved in the project find other work in the city to recoup the revenue lost from the project’s cancellation. He says Messer and Prus in particular are based in and already work heavily in Cincinnati, so it’s unlikely they would try to cut ties with the city.
Streetcar supporters aren’t convinced. If the city pulls out of such a big commitment, officials argue both the federal government and developers could be compelled to look for a more reliable source for future work.
Meanwhile, Deatrick says current construction work is progressing on time and within budget. He expects the track on Elm Street to be laid down between 12th and Henry streets by the end of the year.
As for the next phase of the project, Deatrick says there’s still no estimated cost. He attributes much of the project’s current political problems to construction bids coming in over budget earlier in the year — a turn of events that led City Council to put another $17.5 million to the streetcar project — so he says the city needs to be really careful with future estimates if it decides to expand the streetcar system.
Despite the fresh political threats, the city still intends to conduct meetings with businesses on Nov. 14 and 18 about the benefits of the streetcar. Deatrick says those meetings should show the economic benefits of the rail line that go beyond the streetcar’s use as a transit network.
Supporters of the streetcar often point to those benefits as their reasoning for backing the project. Citing a 2007 study from consulting firm HDR that was later evaluated and supported by the University of Cincinnati, supporters say the streetcar project would produce a three-to-one return on investment.
Deatrick acknowledges those projections are now outdated, given all the changes the project has gone through since 2007. He says the city has people working on updating the numbers and looking at other economic effects the HDR study may have missed.
But opponents of the streetcar project say it’s simply too expensive and the wrong priority for Cincinnati. Still, the potentially high cost of cancellation could prove a bigger fiscal concern.
Either way, Cincinnati should find out the full consequences to the project in December.
The Cincinnati streetcar took another step forward on Monday when car builder CAF USA unveiled renderings for the $133 million project.
The city has hired CAF to supply five cars. The latest details show the cars will have four doors on each side and be capable of moving in both directions on a track. The cars are also completely low-floor, which should make boarding, disembarking and moving around the streetcar easier.
CAF, which is based in Spain, has supplied cars for a few other U.S. cities, including Pittsburgh, Houston and Sacramento, Calif.
John Deatrick, the streetcar project’s executive director, told CityBeat on Thursday that he’s been in regular contact with CAF USA since he joined the project in August.
Unlike most other streetcars around the world, the Cincinnati cars are particularly tuned to handle sharp turns, according to Deatrick. That’s because the city didn’t want to expand roads and knock down buildings just to accommodate the transit network.
Deatrick says the true test for the cars will come once they’re shipped and tested on a completed Over-the-Rhine loop in June 2015. The streetcar is set to open for use on Sept. 15, 2016.
Check out the renderings here.
City Manager Milton Dohoney Jr. defended the streetcar project at a special four-hour session of City Council yesterday, but the city manager did not reveal any specifics over how the project’s $17.4 million budget gap could be closed. Dohoney revealed the price of halting the project would be $72 million: the project has already cost the city $19.7 million, the city would have to spend another $14.2 million in close-out costs and another $38.1 million in federal grants would have to be returned to the federal government. Most of Dohoney’s presentation focused on the streetcar’s economic benefits, but opponents say the budget gap proves the streetcar project is unsustainable and its costs are too high.
The Cincinnati Enquirer identified the 17-year-old honors student at LaSalle High School who tried to commit suicide
in front of a classroom of 22 other students yesterday, even though parents asked press to provide privacy. The student remains
alive and in critical condition this morning. No other students were physically hurt, and classes are
resuming as normal. (Update: The student’s name was removed from this post upon the family’s request.)
The city is moving to sell Tower Place Mall for $1 to Brook Lane Holdings, an affiliate of JDL Warm Construction, so the construction company can pour $5 million into the defunct mall and convert it into a garage with street-level retail space. Financing the project at Pogue’s Garage, which is across the street from Tower Place Mall, is still being worked out now that the parking plan has been delayed by court battles and a referendum effort.
Cincinnati’s police and firefighter unions are filing a lawsuit over the city’s health care dependent audit. The city is asking employees to verify whether spouses and children are legitimately eligible for health care benefits by turning over documents such as marriage licenses, birth certificates and tax returns. The unions’ attorney told WVXU the unions are willing to provide the necessary documents, but he said they’re concerned the process is too intrusive and difficult.
Two firms are getting tax credits for creating jobs in the Greater Cincinnati area: 5Me, which creates manufacturing software, and Festo Americas, which specializes in factory and process automation. Altogether, the credits could create 312 jobs in the region.
A Democratic state senator hinted yesterday at letting voters decide whether Internet sweepstakes cafes should be allowed in Ohio. State officials, particularly Attorney General Mike DeWine, claim Internet cafes are hubs for criminal activity. The Ohio House already passed a measure that would effectively ban the cafes, but some are cautious of the ban as the Ohio Senate prepares to vote.
An intelligent headlight makes raindrops disappear.
Some people may prefer death to being saved by this terrifying robot snake.
Mayor-elect John Cranley and the newly elected City Council announced on Tuesday that, upon taking office in December, they will terminate the city’s plan to lease its parking meters, lots and garages to the Greater Cincinnati Port Authority, following an agreement with the Port Authority to hold off on a bond sale that would have financed — and effectively sealed — the deal. But it remains unclear how much it will cost to terminate the plan, default on the lease agreement with the Port Authority and allow the Port to break its contracts with private companies that would have operated the assets under the deal. The current city administration argues the parking plan is necessary to help balance the budget over the next two years, pay for economic development projects around the city and modernize the city’s parking assets so, for example, parking meters can accept credit card payments. Opponents argue the plan gives up too much control over the city’s parking assets by outsourcing their operations to private companies based around the country.
But some business leaders are upset with the death of the parking plan because it leaves no visible alternative for funding major development projects like the interchange at Interstate 71 and Martin Luther King Drive.
Cranley now says he will not allow a referendum on any ordinance undoing the streetcar project and will instead try to work with supporters of the project to find another way to put it on the ballot if they can gather enough petition signatures. Cranley says blocking a referendum is necessary to avoid spending money during a referendum campaign that could last months. But for supporters of the streetcar, Cranley’s decision seems highly hypocritical following his repeated praise for the “people’s sacred right of referendum” on the campaign trail after City Council blocked a referendum on the parking plan. If the project is placed on the ballot, it will essentially be the third time it’s brought to a public vote; opponents of the project in 2009 and 2011 pursued two ballot initiatives that many saw as referendums on the streetcar.
Meanwhile, Over-the-Rhine businesses and residents yesterday officially launched a campaign to save the streetcar project from Cranley and a newly elected City Council that appears poised to cancel the project. Touting the project’s potential return on investment and cancellation costs, the group plans to lobby newly elected officials to vote in favor of keeping the project going. The group invited Cranley and all elected council members to join them at a town hall-style meeting on Nov. 14 at the Mercantile Library, where supporters will discuss their path forward. So far, supporters have publicly discussed a concerted lobbying effort, a ballot initiative if council passes an ordinance undoing the streetcar project and possible legal action against the city.
The Cincinnati Enquirer’s editorial board is apparently unpleasantly surprised that Cranley undid the parking plan, even though the board endorsed Cranley for mayor after he ran in opposition to the parking plan for nearly a year.
An Ohio Senate bill caps the spending ability of the Controlling Board, a seven-member legislative board that previously approved the federally funded Medicaid expansion despite the Ohio legislature’s opposition. Gov. John Kasich angered many Republican legislators when he decided to go through the Controlling Board to get the Medicaid expansion, which is a major part of Obamacare.
Meanwhile, the Ohio legislature is working on changes to Medicaid that would cap future cost increases and employ professional staff for a Joint Medicaid Oversight Committee that would have the ability to review Medicaid programs and agencies. The bill also includes a portion that clarifies its passage “shall not be construed with endorsing, validating or otherwise approving the (Medicaid) expansion.”
Despite attempts from city officials and local business leaders, Saks Fifth Avenue is leaving downtown to open a store at Kenwood Collection.
Kentucky’s state auditor will look at the Cincinnati/Northern Kentucky International Airport board’s spending policies and expenses, following reports from The Enquirer that the board spent exorbitant amounts on travel, dining and counseling.
The Sixth Circuit Court of Appeals denied the Milford-Miami Advertiser’s request to appeal a 2012 ruling that charged the Gannett-owned suburban weekly with defamation and ordered the paper to pay the defamed plaintiff $100,000 in damages. In a story titled “Cop's suspension called best move for city,” the newspaper wrongly implicated a Miami Township police officer who was previously accused but later exonerated of sexual assault.
Attorney General Mike DeWine warns that some typhoon relief requests could be scams.
Not satisfied with the mere wonder of beginning to exist, some stars explode in a rainbow of colors when they’re born.
The Coalition Opposed to Additional Spending and Taxes (COAST) has threatened to block a move that would allow Cincinnati to use $37.5 million from the 2007 sale of the Blue Ash Airport for projects other than aviation, $11 million of which would go to the Cincinnati streetcar.
The Blue Ash City Council voted Thursday to re-do the sale of 130 acres at the Blue Ash Airport to the City of Cincinnati. COAST says it wants to put the matter before voters in a 2013 referendum, which would halt the sale and re-instate the original agreement made in 2007 when Cincinnati made the sale.
The two cities decided to re-work the $37.5 million sale because a federal rule requires proceeds from the sale of an operating airport to be used for other aviation projects. The money would be returned, airport shut down and then the property re-sold to Blue Ash for the original amount.
“When they originally sold it they were stupid, which is typical of the City of Cincinnati, and did not realize that the proceeds on the sale of the airport have to go to other aviation-type things,” says COAST Chairman Tom Brinkman. “Now that they want to get the streetcar, they want to crack that money.”
Brinkman openly admits he doesn’t want the money to go to the streetcar (“We’re doing everything we can to make sure that boondoggle doesn’t occur”) but says COAST is working with a group of local pilots who want money from the sale to go to Cincinnati’s Lunken Airport.
Blue Ash is confident that the ordinance they passed approving the re-sale isn’t subject to referendum.
“Blue Ash believes everything enacted was lawful and would survive any challenge,” says City Solicitor Brian Pachenco. He declined to discuss specifics
The city wants the airport land to build a park.
Pachenco said the ordinance wasn’t written specifically to exempt it from referendum attempts, but nevertheless it falls under a section of the city’s charter that makes voters unable to recall it.
COAST isn’t so sure.
Chris Finney, legal counsel for COAST, said the buying and selling of land under the Blue Ash charter is subject to referendum. He said the ordinance was written to avoid using that language, but what was happening was in reality a sale.
For its part, Cincinnati doesn’t seem too concerned with the threatened referendum.
“We’re not going to talk 'what ifs' at this point,” city spokeswoman Meg Olberding said. “The streetcar has had two previous referendums that have been shot down.”
She pointed out that only $11 million of the sale was going toward the streetcar, and the remaining money would be available for other projects.
Cincinnati City Councilman Chris Seelbach was also unconcerned.
“COAST and groups like COAST have tried to put up every obstacle possible to prevent the streetcar from happening and we have overcome all of them,” Seelbach said. “I am 100 percent positive if this comes to a vote we will overcome it again and the streetcar will be built.”
At first glance, it might seem like a rail line between downtown Cincinnati and the city of Milford would earn support from the same people who back the $132.8 million streetcar project, but streetcar supporters, including advocacy group Cincinnatians for Progress, say they oppose the idea and its execution.
Critics of the overall project, called the Eastern Corridor, recently pointed to a November study from HDR. Despite flowery language promising a maximized investment, HDR found seven of 10 stations on the $230-$322 million Oasis rail line would result in low economic development, five of 10 stations would provide low access to buses and bikes, and the intercity line would achieve only 3,440 daily riders by 2030.
HDR’s findings for the Oasis line stand in sharp contrast to its study of Cincinnati’s streetcar project. The firm found the streetcar line in Over-the-Rhine and downtown would generate major economic development and a 2.7-to-1 return on investment over 35 years.
Given the poor results for the Oasis line, streetcar
supporters say local officials should ditch the Oasis concept and
instead pursue the 2002 MetroMoves plan and an expansion of the
streetcar system through a piecemeal approach that would create a central transit spine through the region.
“To have (the Oasis line) be our first commuter rail piece in Cincinnati … just doesn’t make sense to me,” says Derek Bauman, co-chair of Cincinnatians for Progress.
MetroMoves spans across the entire city and region, with the rail line along I-71 from Cincinnati/Northern Kentucky International Airport to downtown Cincinnati to King’s Island fostering particularly high interest.
Voters rejected the MetroMoves plan and the sales tax hike it involved in 2002, but streetcar supporters say public opinion will shift once the streetcar becomes reality in Cincinnati.
“That’s been proven in other cities, especially ones that have not historically been transit-oriented,” Bauman says, pointing to Houston and Miami as examples of cities that built spines that are now being expanded.
Opposition to the Oasis line is also more deeply rooted in a general movement against the Eastern Corridor project. The unfunded billion-dollar project involves a few parts: relocating Ohio 32 through the East Side, the Oasis rail line and several road improvements from Cincinnati to Milford.
Supporters of the Eastern Corridor claim it would ease congestion, at least in the short term, and provide a cohesiveness in transportation options that’s severely lacking in the East Side.
Opponents argue the few benefits, some of which both sides agree are rooted in legitimate concerns, just aren’t worth the high costs and various risks tied to the project.
“When it comes to widening roads and highways, it’s kind of like loosening your belt at Thanksgiving. Somehow traffic always fills to fit,” Bauman says. “Highway expansion, especially in urban areas, is not the future. It’s not even the present in some areas.”
The big concern is that the relocation of Ohio 32 might do to the East Side and eastern Hamilton County what I-75 did to the West Side, which was partly obliterated and divided by the massive freeway.
“It hurts the cohesiveness of our communities when you create these big divides,” Bauman argues. “You would see that repeat itself.”
Officials are taking feedback for the Eastern Corridor and Oasis rail line at EasternCorridor.org.
This article was updated to use more up-to-date figures for the cost of the Oasis rail line.
“Americans drive fewer total miles today than we did eight years ago, and fewer per person than we did at the end of Bill Clinton’s first term,” the report reads. “The unique combination of conditions that fueled the Driving Boom — from cheap gas prices to the rapid expansion of the workforce during the Baby Boom generation — no longer exists. Meanwhile, a new generation — the Millennials — is demanding a new American Dream less dependent on driving.”
The report also says U.S. transportation policy “remains stuck in the past” and needs to “hit the ‘reset’ button.”
The report, which uses U.S. Department of Transportation data from 2012, found Americans were driving about 9,000 miles a year per person in 2012, down from a peak of nearly 10,000 in 2004. Until the peak, Americans had been driving more miles each year since the end of World War II.
The report finds the driving trend at odds with other means of transportation: “On the other hand, Americans took nearly 10 percent more trips via public transportation in 2011 than we did in 2005. The nation also saw increases in commuting by bike and on foot.”
The report attributes much of the shift to millennials, members of the generation born between 1983 and 2000, which the report says are more likely to demand public transportation and urban and walkable neighborhoods. The new expectations are largely driven by Internet-connected technologies, which are “rapidly spawning new transportation options and shifting the way young Americans relate to one another, creating new avenues for living connected, vibrant lives that are less reliant on driving,” according to the report.
PIRG finds the trend will likely stick as gas prices continue to rise, fewer Americans participate in the labor force and Americans demands less time spent in travel.
Even if millennials begin driving more in the future, the report’s findings show Americans are going to be driving much less in 2040 than federal agencies currently assume. “This raises the question of whether changing trends in driving are being adequately factored into public policy,” the report reads.
The report concludes local, state and federal governments should react to the new trend by planning for uncertainty, accommodating millennials’ demands, reviewing the need for more highway projects, adapting federal priorities, using transportation funds based on cost-benefit analyses and conducting more transportation research.
For Cincinnati, the trend could have implications for two major transportation projects: the MLK/I-71 Interchange and the streetcar.
The streetcar project uses capital funding sources — some uniquely tied to mass transit projects — that some opponents argue should be reallocated to support the MLK/I-71 Interchange project.
But the report’s findings seem to support the city’s current plans to push forward with mass transit projects like the streetcar, even while local funding for the MLK/I-71 Interchange project remains uncertain.
After making changes based on feedback from public meetings, the Ohio Department of Transportation priced the interchange project at $80 million to $102 million, or $10 million to $32 million higher than the previous estimate of $70 million.
The higher price didn’t lead to the same outcry that resulted from the streetcar project’s $17.4 million cost overrun, likely because of the interchange project’s broader support, secure state funding and feedback-driven circumstances.
Still, the city could share some of the higher cost burden for the MLK/I-71 Interchange project. Previously, the city planned to use funds raised by leasing its parking assets to the Port Authority for the interchange, but that plan is currently being held up in court.
In 2012, the city adopted Plan Cincinnati, the city’s first master plan since 1980. The plan advocates for more alternative methods of public transportation, particularly light rail and bike lanes. But the master plan does not establish means of funding, so City Council will have to approve funding over time to implement the plan.
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.
An anti-tax group has made opposing Cincinnati’s planned streetcar project its primary cause in recent years, so it might be surprising to now find one of its leaders teaming up with a major streetcar advocate.
But that’s exactly what is happening later this month as Chris Finney, of the Coalition Opposed to Additional Spending and Taxes (COAST), co-hosts a political fundraiser with Chris Bortz, an ex-Cincinnati city councilman.
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.