The recently passed state budget means cities and counties will get even less money from the state, according to a new report from progressive think tank Policy Matters Ohio.
The report looks at “three blows” of cuts to local governments: less direct aid, no money from a now-repealed estate tax and the beginning of the end of a state subsidy that supported local property taxes. The cuts add up to at least $720 million less over the next two years than cities and counties got in the past two years, the report finds.
It’s even less money when looking further back in Ohio’s history — specifically before Republican Gov. John Kasich took office.
“Local governments will see $1.5 billion less in tax revenues and state aid compared with” fiscal years 2010 and 2011, said Wendy Patton, the report’s author, in a statement. “Fiscal crisis will continue in many communities.”
Kasich and Republican legislators slashed local government funding in 2011 to help fix an $8 billion budget hole. But the latest state budget, which Kasich signed into law in June, was awash in extra revenues because of Ohio’s economic recovery — so much so that legislators passed $2.7 billion in tax cuts.
The Republican-controlled state government repealed the estate tax in the last budget, but some Democrats and local governments were hopeful at least some of the lost money could be restored this year.
Casino revenue was supposed to curtail some of the cuts, but Policy Matters concludes it’s not enough. Casino revenue has also consistently come under expectations: The state government in 2009 estimated Ohio’s casinos would take in $1.9 billion a year, but that projection was changed in February to roughly $1 billion a year.
For Cincinnati, the previous round of budget cuts cost the
city more than $22 million in revenues — nearly two-thirds of the
budget gap the city faced for fiscal year 2014. Although the city managed to avoid laying off cops and firefighters as a result, it still had to slash other city services and raise property taxes.
Some city and county officials are trying to persuade the state government to undo the cuts. In March, Cincinnati Councilman P.G. Sittenfeld gathered officials around the state to launch ProtectMyOhio.com, which lets citizens write directly to the state government about the cuts.
A budget plan proposed by two council members today would eliminate layoffs at the fire department and reduce the amount of police layoffs to 25, down from 49, by making cuts elsewhere, particularly by forcing city employees to take 10 furlough days in fiscal year 2014.
Council members Roxanne Qualls and Chris Seelbach are co-sponsoring the motion. If it's approved by City Council, the amount of city employee layoffs in the fiscal year 2014 budget would drop to 84, down from the original "Plan B" estimate of 344, by amending Mayor Mark Mallory's budget proposal, which was announced yesterday.
The news is being well received by public safety advocates, but it's also vindication for some of the city's harshest critics. Democratic mayoral candidate John Cranley previously said the city was acting like "the boy who cried wolf" by suggesting it had to lay off 344 city employees, including 80 firefighter and 189 police positions.
"In 2009, 2010, 2011 and 2012 … they threatened to lay off police and firefighters, and it never happened," Cranley previously told CityBeat.
But avoiding the layoffs comes with large cuts and shifted priorities elsewhere: Furlough days for supervisory and leadership personnel would be bumped up from five to 10 ($250,000 in savings), all council members would be asked to take 10 furlough days ($22,700), City Council's office budgets would be reduced ($18,000), the clerk of council's office budget would also be reduced ($46,000), the departments of community development and economic development would be merged ($171,000) and the account for firefighter's protective gear would be reduced ($100,000). In total, the cuts in the motion add up to $607,000.
The motion will be formally introduced at tonight's Budget and Finance Committee meeting, which will also act as a public hearing for budget issues. The hearing will begin at 6:30 p.m. at the Duke Energy Convention Center.
The layoff reductions come after the city manager and mayor spent a bulk of the past six months repeatedly warning that the city would have to carry out significant public safety layoffs if the city didn't lease its parking assets to the Port Authority. That plan would have opened up funds to help balance the budget for two years and pay for economic development projects, including a downtown grocery store ("Parking Stimulus," issue of Feb. 27).
But the parking plan is now held up in court, and the city is apparently able to avoid most of the layoffs despite the repeated warnings.
The city must enact a budget by May 31, which will give the city the required 30 days to implement the plan by fiscal year 2014, which begins July 1.
In a ruling today, Hamilton County Judge Robert Winkler said the city will have to allow for a referendum on the parking plan and imposed a permanent injunction pending the outcome of a referendum.
The ruling means the city may be unable to rely on the parking plan to balance fiscal year 2014’s budget, and the city may be forced to find cuts elsewhere by July 1, when the new budget will kick in.
The ruling may be appealed, but City Solicitor John Curp says he is not aware of any filing yet. He says Mayor Mark Mallory and the city administration plan to hold a press conference later this afternoon to discuss the ruling in further detail.
For opponents of the parking plan, the ruling comes as a big victory that will allow them to put the parking plan on the ballot if they gather enough eligible petition signatures by April 5.
For the city, the ruling potentially leaves a $25.8 million hole in the 2014 budget.
When the restraining order was extended for two weeks on March 20, city spokesperson Meg Olberding told CityBeat the delays were causing the city to approach a “pressure point”: “We respect the court's right to do that (the extension), and know that every day that we cannot make the parking deal happen is a day that we are closer to having to lay people off.”In the past, City Manager Milton Dohoney Jr. said the plan will force the city to lay off 344 employees, including 80 firefighter and 189 police positions.
But opponents argue there are ways to solve the budget without laying people off. As an alternative to the parking plan, Councilman Chris Seelbach proposed Plan S, which would redirect $7.5 million in casino revenue to help balance the deficit, cut $5 million based on the results of the city's priority-driven budgeting process and put two charter amendments on the ballot that, if approved, would include up to a $10-per-month trash fee and increase the city's admissions tax by 2 percent.
City Council approved the parking plan on March 6 to lease the city’s parking assets to the Port of Greater Cincinnati Development Authority to help balance the budget for the next two fiscal years and fund more than $100 million in development projects, including the creation of a downtown grocery store and more than 300 luxury apartments ("Parking Stimulus," issue of Feb. 27).
Opponents of the parking plan say they’re concerned the city will cede too much control over its parking assets and cause parking rates to skyrocket. The city says rate increases are initially capped at 3 percent or inflation — whichever is higher.
But the rates can change with a unanimous vote from a special committee, approval from the city manager and a final nod from the Port Authority. The special committee would comprise of four people appointed by the Port Authority and one appointed by the city manager.
The ruling comes after the city and opponents of the parking plan met in court on March 15 to discuss whether the plan is subject to referendum.
Curt Hartmann, an attorney who represents the Coalition Opposed to Additional Spending and Taxes (COAST) and opponents of the parking plan, said the city charter is vague on its definition of emergency clauses, and legal precedent supports siding with voters’ right to referendum when there is ambiguity.
The city cited state law to argue emergency clauses, which remove a 30-day waiting period on legislation, eliminate the possibility of referendum. Terry Nestor, who represented the city, said legal precedent requires the city to defer to state law as long as state law is not contradicted in the city charter.
With his decision, Winkler sided with opponents of the parking plan. He wrote in the ruling, “If the people of Cincinnati had intended to exempt emergency legislation from their referendum powers, they could have done so when adopting Article II, Section 3 of the City Charter.”
Cincinnati's streetcar project is getting another $5 million in federal funding. But before the money is handed over, the city must first eliminate cost overruns that have recently put the project in danger.
U.S. Secretary of Transportation Ray LaHood unveiled the news in a letter to Mayor Mark Mallory dated June 19. The letter acknowledges the project's recent cost overruns, but goes on to claim the federal government still backs the project.
"The DOT (Department of Transportation) continues to support your bold vision for economic development and enhanced transportation choices for the city of Cincinnati, and we believe that this project is a significant component of that vision. With that in mind, I want to provide up to $5 million in additional assistance from DOT," LaHood wrote.
But the money comes with two conditions: The city must first fix the streetcar project's cost overruns and restore certain aspects of the project, including a passenger information system and a screen or wall that would block power substations from public view.
The $5 million will be on top of the nearly $40 million the federal government has already contributed to the project through various grants and programs.
The funding bump comes just in time for City Council's Monday vote on the streetcar project's cost overruns.
In February, the city received construction bids that were $26 million to $43 million over budget, effectively leading to a $17.4 million budget gap and a $133 million overall cost for the project.
Since then, City Manager Milton Dohoney proposed a few fixes to City Council, including pulling funding from various capital projects and issuing more debt.
At the same time, Dohoney told City Council the city administration was working with federal officials to find opportunities for more federal funding. The new commitment is presumably the result of those discussions.
City Council is expected to vote on the budget fixes Monday. So far, council members Roxanne Qualls, Yvette Simpson, Wendell Young and Laure Quinlivan have vowed support, but Council will need a fifth vote — perhaps from Chris Seelbach or Pam Thomas — to pass the changes.
Read the full letter below:
Republican state legislators today rolled out a major tax overhaul that would cut Ohio income taxes, but the plan would also increase and expand sales and property taxes.
Legislators plan to add the tax changes to the $61.7 billion two-year budget. The final plan is being touted as a merger of the original proposals from the Ohio House and Senate, but none of the proposed tax hikes in the revised plan were included in the original tax proposals from either chamber.
Relative to rates today, the new plan would cut state income taxes across the board by 8.5 percent in the first year of the budget’s implementation, 9 percent in the second year and 10 percent in the third year. That’s a bump up from the House plan, which only included a 7-percent across-the-board income tax cut.
The Senate’s 50-percent tax deduction for business owners
would be reduced to apply to up to $250,000 of annual net
income, down from $750,000 in the original plan. Under the
revised plan, a business owner making a net income of $250,000 a year
would be able to exempt $125,000 from taxes.
The plan would also create an earned income tax credit that would give a tax refund to low- and moderate-income working Ohioans.
To balance the cuts, the plan would hike the sales tax from 5.5 percent to 5.75 percent. Some sales tax exemptions would be eliminated, including exemptions for digital goods such as e-books and iTunes downloads.
The plan would also make two major changes to property taxes: First, the state would not pay a 12.5-percent property tax rollback on new property tax levies, which means future levies for schools, museums and other services would be 12.5 percent more expensive for local homeowners.
Second, the homestead tax exemption, which allows disabled, senior and widowed Ohioans to shield up to $25,000 of property value from taxes, would be graduated over time to be based on need. In other words, lower-income seniors would still qualify for the exemption, while higher-income seniors wouldn’t. Current exemptions would remain untouched, according to House Finance and Appropriations Committee Chairman Ron Amstutz.
The final tax plan is a lot closer to Gov. John Kasich’s original budget proposal, which left-leaning Policy Matters Ohio criticized for disproportionately favoring the wealthy (“Smoke and Mirrors,” issue of Feb. 20).
The budget must now be approved by the conference committee, House, Senate and Gov. John Kasich in time for a June 30 deadline.
Democratic gubernatorial candidate Ed FitzGerald is urging a coalition effort to begin a long, complicated petitioning process that could repeal some of the anti-abortion measures in the recently approved two-year state budget.
If the petitioning process is successful, it would force the Ohio General Assembly to consider repealing aspects of the budget that don’t involve appropriations of money. If the General Assembly changes, rejects or ignores the repeal proposal, it could be put on the ballot in November 2014.
FitzGerald is jump-starting the repeal effort through a new website, Ohioans Fight Back.
Speaking at a press conference Thursday, FitzGerald also questioned the constitutionality of some of the anti-abortion measures, particularly those that require doctors give certain medical information regarding abortions and restrict publicly funded rape crisis centers from discussing abortion as a viable option. He said such rules might violate free speech rights.
The state budget effectively defunds contraceptive care and other non-abortion services at various family planning clinics, including Planned Parenthood. It also makes it more difficult for abortion clinics to establish mandatory patient transfer agreements with hospitals.
The budget provides separate federal funding to crisis pregnancy centers, which act as the pro-abstinence, anti-abortion alternatives to comprehensive clinics like Planned Parenthood.
The budget also gives money to rape crisis centers, but centers that take public funding are barred from discussing abortion as a viable option with rape victims.
Days before the budget’s passage, Republican legislators also added an amendment that forces women to get an ultrasound prior to getting an abortion. As part of the amendment, doctors are required to inform the patient if a heartbeat is detected during the ultrasound and provide an estimate of the fetus’s chances of making it to birth.
FitzGerald, who’s currently Cuyahoga County executive,
plans to run against Republican Gov. John Kasich in 2014.
Kasich signed the controversial state budget with the anti-abortion measures on June 30, despite calls for the governor to use his line-item veto powers — a move that would have kept the rest of the budget in place but repealed the anti-abortion provisions.
CityBeat analyzed the state budget in further detail here.
By now, most of you have heard there was another horrible mass shooting, this time in Newtown, Conn., that resulted in the death of 20 children and six adults. While everyone is hoping this is the last time the nation has to deal with an event of unspeakable horror, it is only a possibility if we agree to do something about it. That means remembering the heroes who risked their lives and, in some cases, died that day. That means not letting the media and public drop the issue, as has been the case in the past. That means looking at more than just gun control, including mental health services. The Washington Post analyzed what “meaningful” action on gun control would look like, and the newspaper also disproved the idea Switzerland and Israel are “gun-toting utopias.” President Barack Obama also spoke on the issue at a vigil Sunday, calling for the nation to do more to protect people, particularly children, from violence. The full speech can be watched here.
City Council approved its 2013 budget plan Friday. The budget relies on the privatization of city parking assets to help plug a $34 million deficit and avoid 344 layoffs. The budget also nixed the elimination of a tax reciprocity for people who lived in Cincinnati but worked elsewhere and paid income tax in both cities, and it continued funding the police department’s mounted unit. As a separate issue, City Council voted to increase the property tax by about 24 percent, reversing a move from conservatives in 2011. CityBeat wrote about budgets at all levels of government and how they affect jobs here.
Michelle Dillingham, who was an aide to former city councilman David Crowley, will seek Democratic support in a run for City Council. Dillingham promises to tackle “industry issues of mutual interest" to business and labor and “transportation funding, family-supporting wages and workforce development.”
At a recent public hearing, mayoral candidate John Cranley proposed a “very easy” plan for the city budget. Only problem: His plan doesn’t work. In an email, Cranley said he stands by his ideas, but he added he was working with limited information and his statements were part of a two-minute speech, which “requires brevity.” He also claimed there are cost-cutting measures that can be sought out without privatizing the city’s parking assets and gave modified versions of his ideas regarding casino and parking meter revenue.
Judge Robert Lyons, the Butler County judge who sealed the Miami rape flyer case, is standing by his decision.
The Greater Cincinnati area is near the top for private-sector growth.
Jedson Engineering is moving from Clermont County to downtown Cincinnati, thanks in part to an incentive package from City Council that includes a 45 percent tax credit based on employees earnings taxes over the next five years and a $300,000 grant for capital improvements. The company was a Business Courier Fast 55 finalist in 2008 and 2009 due to its high revenue growth.
Gov. John Kasich’s Ohio Turnpike plan is getting some support from Toledo Mayor Mike Bell, but others are weary. They fear the plan, which leverages the turnpike through bonds for state infrastructure projects, will move turnpike revenues out of northern Ohio. But Kasich vows to keep more than 90 percent of projects in northern Ohio.
Gas prices are still falling in Ohio.
U.S. House Speaker John Boehner is making some concessions in fiscal talks. In his latest budget, he proposed raising taxes on those who make more than $1 million a year.
One beagle can diagnose diseases by sniffing stool samples.
In a party line 23-10 vote today, the Republican-controlled Ohio Senate approved a $61 billion budget plan for fiscal years
2014 and 2015 that takes multiple measures against legal
abortions, aims to cut taxes for small businesses and partly restores education funding cut in the previous 2012-2013 budget.
The budget plan gives a large amount of attention to
social issues, particularly abortion. Most recently, the Ohio Senate added an amendment that could be used by the director of the Ohio Department of Health to close down abortion clinics.
The amendment bans abortion clinics from establishing transfer agreements with public hospitals, forcing the clinics to make such agreements with private hospitals,
which are often religious and could refuse to deal with abortion clinics. Under the amendment, if the clinics can’t reach a transfer agreement, the state health director is given the power to shut them down.
Abortion rights groups claim the amendment will likely be used to shut down abortion clinics or force them to dissolve their abortion services.
The bill also makes changes to family services funding that effectively defund Planned Parenthood, a family planning services provider that is often criticized by conservatives for offering abortion services, even though it does so exclusively through private donations.
The bill also redirects some federal Temporary Assistance for Needy Families funds to crisis pregnancy centers, which effectively act as the anti-abortion alternative to comprehensive family planning service providers like Planned Parenthood.
The changes continue a conservative push on social issues that began in the Ohio House budget (“The Chastity Bunch,” issue of April 24).
Supporters praise the bill for “protecting life” and promoting “chastity” and “abstinence,” but critics are pushing back.
“Today the Ohio Senate turned its back on the health care needs of Ohio’s women and paved the way for family planning centers and abortion clinics to be closed across the state. If Gov. (John) Kasich doesn’t remove these provisions from the budget, the unintended pregnancy rate will rise, cancer will go undetected and women who need abortion care will not have safe, legal facilities to turn to in some communities,” said Kellie Copeland, executive director of NARAL Pro-Choice Ohio, in a statement. “This budget will put the lives of thousands of Ohio women at risk if Gov. Kasich fails to line-item veto these dangerous measures.”The Ohio Senate plan also scraps Ohio House plans to cut income taxes for all Ohioans by 7 percent and instead aims to cut taxes for small businesses by 50 percent.
Republicans claim the tax cut will help small businesses, which they call the state’s “job creators.” But conservative and liberal groups have criticized the plan.
Given that, Zach Schiller, research director at Policy Matters, says the plan will do little for Ohio’s economy.
“The fastest growing small businesses are not making money because they’re investing heavily in their operations — in marketing, research and sales,” Schiller says. “So if they’re making anything, they’re investing it by and large in the business, so they’re not likely to be able to benefit very much from this.”
He adds, “Meanwhile, you’re going to have passive investors who have no role in adding employees and partners in law firms, architecture firms, accounting firms and other kinds of professional organizations who will personally benefit from this in a way that I think is unlikely to generate more employment.”
Instead of focusing on tax cuts, Schiller argues the state should be increasing direct investments, particularly in education and human services.
“This is bad policy, and many supporters are errantly pushing it under the guise of putting more money in the hands of ‘job-creators.’ But this is based on a flawed understanding of what creates jobs,” wrote Scott Drenkard of the Tax Foundation. “The businesses that actually create jobs are not small businesses or big businesses; they are businesses that are growing. And that type of business is virtually impossible to target with a tax incentive.”
The budget plan restores about $717 million in education funding, but that’s not enough to outweigh the $1.8 billion in education funding that was cut in the 2012-2013 budget, which Kasich and the Republican-controlled legislature approved in 2011.
The education funding increases will disproportionately favor the state’s property-wealthiest districts — effectively giving the biggest funding increases to school districts that can already afford to raise more money by leveraging high local property values.
The chart shows only 15 percent of funding increases will go to the property-poorest one-third of school districts, while a vast majority of the increases will go to the property-wealthiest one-third.
Health care advocates were also disappointed to see the Ohio Senate pass on a federally funded Medicaid expansion, which would allow anyone at or below 138 percent of the federal poverty level — $15,856 for a single-person household and $32,499 for a family of four — to enroll in the government-backed health care program.
Kasich proposed expanding Medicaid in his original budget plan (“Smoke and Mirrors,” issue of Feb. 20), but Ohio legislators are skeptical of the expansion’s consequences.
As part of the Affordable Care Act (“Obamacare”), the Medicaid expansion would be fully financed by the federal government for the first three years. After that, federal payments would be phased down to capture 90 percent of the expansion, where federal funding would permanently remain.
Republican legislators, backed by Republican State Treasurer Josh Mandel, are skeptical the federal government can afford the expansion. There’s no historical precedent for the federal government failing to meet its obligations to Medicaid, but Republican legislators argue there’s also no historical precedent for the federal government backing such large Medicaid expansions across the nation.
A Health Policy Institute of Ohio study found the Medicaid expansion would save the state $1.8 billion and insure nearly half a million Ohioans over the next decade.
The budget also fails to restore local government funding cuts that have been carried out during Kasich’s time in office. In comparison to fiscal years 2010 and 2011, local governments are receiving about 50 percent less aid from the state, leading to $22.2 million less funds for Cincinnati on an annual basis (“Enemy of the State,” issue of March 20).
When asked to explain the various cuts to education and local government funding in the 2012-2013 budget, Kasich spokesperson Rob Nichols told CityBeat in September 2012, “The reality is we walked into an $8 billion budget deficit. … We had to fix that.”
The Ohio legislature and Kasich must agree on a budget plan in time for a June 30 deadline.
Two Ohio senators, including Senate Minority Leader Eric Kearney of Cincinnati, are pushing a bill that will require the state’s Bureau of Motor Vehicles to grant driver’s licenses to the children of illegal immigrants. The senators claim state BMV offices are inconsistently applying President Barack Obama’s Deferred Action for Childhood Arrivals program, which allows the children of illegal immigrants to remain in the country without fear of prosecution, but the Ohio Department of Public Safety says the issue is still under review. CityBeat originally broke the story after hearing of Ever Portillo’s experiences at a Columbus BMV office here, and a follow-up story covered the internal conflict at the BMV over the issue here.
Ohio officials have said the state has only put $1 million toward JobsOhio, but records recently acquired by The Columbus Dispatch show $5.3 million in funding has been directed to the program
so far, and the public investment could be as high as $9 million. State
officials said the funding is necessary because constitutional
challenges, which the Ohio Supreme Court recently agreed to take up,
have held up the program’s original source of funding — state liquor
profits. JobsOhio is a nonprofit company established with the support of
Gov. John Kasich that’s meant to attract investment and bring jobs to
the state. Kasich says he wants to replace the Ohio Department of Development with the nonprofit company in the future.
City Council’s Budget and Finance Committee approved a plan to lease Cincinnati’s parking assets to the Port of Greater Cincinnati Development Authority in a 4-3 vote yesterday, but the plan will require five votes to become law in a final City Council vote tomorrow. The plan, which CityBeat previously covered, would lease the city’s parking assets to fund development projects, including a 30-story tower and a downtown grocery store, and help balance the deficit. The deal would produce a $92 million upfront payment, and the city projects that additional annual installments would generate more than $263 million throughout the lease’s duration. Critics are worried the city will give up too much control of its parking assets as part of the deal, and concerns about the city’s long-term deficits remain. The alternatives — plans B, C and S — would fix structural deficit problems, while the budget only helps balance the deficit for the next two fiscal years.
The company that will operate Cincinnati’s parking meters if the parking deal is approved by City Council had problems in the past, according to a tip received by multiple news outlets from Tabitha Woodruff, an advocate at Ohio Public Interest Research Group. The issues surfaced years before Affiliated Computer Services (ACS) was bought by Xerox in 2010, and Xerox now denies any wrongdoing. One of the issues is a 2007 audit, which found ACS mismanaged parking meters in Washington, D.C. Kevin Lightfoot, a spokesperson at Xerox, says the audit was based on “faulty information,” and a lot of the problems found were because the auditor improperly read parking meter screen displays.
An approved commitment by the Hamilton County Transportation Improvement District (HCTID) may ensure a rail service is ready for Cincinnati in time for the 2015 Major League Baseball All-Star Game. Hamilton County Commissioner Todd Portune is pushing for local and state governments to break down any barriers for Oasis Rail Transit, which will carry passengers from Downtown to Milford.
The Ohio Board of Education will decide between two candidates for state superintendent next week: acting Superintendent of Public Instruction Michael Sawyers or Dick Ross, Gov. John Kasich’s top education adviser.
After years of development and anticipation, Cincinnati’s Horseshoe Casino opened yesterday. The casino comes with the promise of jobs and economic development, but it also poses the risk of crime, bankruptcy and even suicide. State and local legislators are also looking forward to extra government revenue from the casino, even though casino revenue around the state has fallen short of projections. For Over-the-Rhine residents, the grand opening, which culminated in a fireworks display, was sort of like being in the middle of a thunderstorm.
Livability.com named Cincinnati the No. 10 spring break destination because of the Cincinnati Zoo, Botanical Garden, IKEA, Cincinnati Art Museum, the 21c Museum Hotel, Newport Aquarium and the Clifton Cultural Arts Center, among other places and family-friendly activities.
Science doesn’t want pregnant women to be capable of anything.
Here are two pictures of Venus from Saturn’s view.
City Council’s Budget and Finance Committee today approved a
plan to lease Cincinnati’s parking assets to the Port of Greater
Cincinnati Development Authority in a 4-3 vote, but the plan will require five votes to become law in a final City Council vote on March 6.
Council members Roxanne Qualls, Yvette Simpson, Cecil Thomas and Wendell Young voted for the plan, and council members Chris Seelbach, Chris Smitherman and Charlie Winburn voted against it. Councilman P.G. Sittenfeld was absent, and Councilwoman Laure Quinlivan abstained, although she said she could vote yes if she sees more details about how the city will curb its long-term budget problems.
The plan, which CityBeat previously covered (“Parking Stimulus,” issue of Feb. 27), would lease the city’s parking assets to fund development projects, including a 30-story tower and a downtown grocery store, and help balance the deficit for the next two fiscal years. The deal would produce a $92 million upfront payment, and the city projects that additional annual installments would generate more than $263 million throughout the lease’s duration.
Before the vote, several City Council members said the parking plan would not solve Cincinnati’s structural deficit problems, but City Manager Milton Dohoney Jr. said the plan would help reduce the deficit by generating recurring revenues through long-term economic growth and development.
“The situation that we’re in requires that we accelerate
growth right now, not later,” he said. “If we do not do that, then we’re going to
have further negative ramifications to deal with.”
Still, Dohoney admitted the plan would not solve all the city’s budget woes — just like he has repeatedly said in the past. Even with the parking plan, the city projects a $10 million deficit in 2014, $15.5 million deficit in 2015 and $20 million deficit in 2016.
The council members insisted there are alternatives to the parking plan and Dohoney’s Plan B, which would lay off 344 employees, eliminate Human Services Funding and close pools and recreation centers, among other changes.
On March 1, Seelbach proposed Plan S, which would not lease the city’s parking assets to balance the budget and would instead use $7.5 million in casino revenue, cut $5 million based on the results of the city's priority-driven budgeting and allow voters to choose between a $10-per-month trash fee or a 2-percent increase in the city's admissions tax.
On the same day as the hearings, Winburn, the sole Republican on City Council, proposed Plan C, which would reduce city employees’ salaries across the board — with exemptions for police, ﬁre, health, garbage, recreation, parks and road paving — and use casino and parking revenue to clear the deficit.
At the City Council hearings, Quinlivan listed a few other
possibilities, including sharing public safety services with other
local communities. She also advised the city to put together a long-term deficit reduction plan. “We don’t want to kick the can down the road any more,” she said.
Thomas suggested putting an earnings tax hike of 0.1 percent or 0.2 percent on the ballot. He said, “It would solve this (deficit) problem once and for all.”
Some council members also raised concerns about the release of bond documents, which will further detail the framework of the parking agreement. Dohoney and Laura Brunner, president of the Port Authority, said the bond documents have not been crafted because a lease agreement has to be approved by City Council first, but the documents will be made public once they are put together.
Before the final committee vote, Smitherman successfully
motioned to separate part of the parking plan from the budget, which opens the plan to referendum. The motion was in response to City Solicitor
John Curp, who said appropriation ordinances, or ordinances that are essentially budgets, aren’t subject to
referendum, according to state law.