More Money And A Possible Operating Plan For The Streetcar?
A Cincinnati Council majority is supporting a plan to pledge an additional $2 million of general fund money to operating the streetcar.
That same majority also is recommending the "management" approach be used to operate the system. A private contractor would provide oversight, with current union transit workers operating the streetcars. The decision comes after the Council could not agree on an option last week.
The “management” option comes with a higher price tag and possible future deficit.
Council member Kevin Flynn continues to support the cheaper alternative.
“I do think that under the turn-key approach we can operate at the recommended levels of service that were provided in the grant applications that we went for with the federal government,” Flynn said.
Flynn said that option will work without deficits in the future. The "turn-key" plan is a private contractor managing the system and hiring the operators.
Meanwhile, seven council members have signed a motion that streetcar service not be reduced under either option. That brought an angry response from Mayor John Cranley.
“If Council wants to guarantee some level of service, I think that Council owes it to the public to say how much service it is, how much it’s going to cost and what they’re going to cut out of the city budget to pay for it,” Cranley said.
Flynn and his staff did spreadsheets reflecting numbers for both operating approaches based on projected revenues and expenses.
Flynn predicted the “management” option will result in a future streetcar operating fund deficit of anywhere from $1.1 million to $5.6 million by 2027, depending on how the additional $2 million of general fund money is spent. If it is used over several years, the future deficits are smaller. If the $2 million is used in the first year of operation, the deficits grow much larger.
Flynn suggested the “turn-key” approach will work without future deficits if surplus money accumulating now in the streetcar operating fund is drawn down over several years. Again if that surplus is spent all in the first year, the even the “turn-key” approach will have a $552,000 deficit by Fiscal Year 2027. Flynn did not use the additional $2 million approved Tuesday in his calculations for the “turn-key” option.
The Southwest Ohio Regional Transit Authority (SORTA) will make the final decision on an operator, and it has said it can only move forward with an option that it has full funding for.
SORTA sent a letter to the city Tuesday, which said even with the additional $2 million from the city it still does not have adequate funding for the "management" approach.
Mayor Cranley responded that the SORTA letter had several pieces of false information, and had the city solicitor write a letter pointing out what the city believes are the transit agency's errors.