The first public hearing for Cincinnati’s next city budget Tuesday night was earlier and shorter than usual.
One topic dominated the evening at the Evanston Recreation Center: support for building the city's first skate park. About a dozen people asked Cincinnati City Council to fund a skate park in the next budget, including 10-year-old Silas Alford.
"I think we should have more skate parks because skating can bring people closer together and you can make new friends. But best of all, it can be a learning experience for you," Alford told Council. "I would encourage you to try new things and build new skate parks."
The Cincinnati Skatepark Project started raising support and private funds about a year ago.
"Unlike many cities across the country, Cincinnati is lacking in safe, accessible, and public places to skateboard, inline skate, roller skate, BMX and other action sports," said Evan Walker of Clifton.
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Walker says the project has raised nearly half of its $100,000 private funding goal. They're asking City Council to allocate $395,000 in the next budget to fund the rest. That could go in either the Parks Department or Recreation Department budget, depending on the site. Walker says the top choice right now is at the Camp Washington Recreation Center.
"The Camp Washington community — which has been disconnected by highways and at times overlooked — is very excited about the opportunity to activate this space," Walker said. "The Camp Washington Community Council and Camp Washington Business Association have both given us written letters of support."
One resident asked Council to invest more in pedestrian safety and transportation.
"There are lots of places in Cincinnati that have roads but no sidewalks," said Aspen Dameron. "And you say that public safety is one of your priorities with this budget, and I would like to see you keeping that in mind."
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Elizabeth Bartley, executive director of Invest in Neighborhoods, expressed concern that the meeting wasn't as crowded as years past.
"Either everyone has given up, or people don't understand the process," Bartley said.
Public engagement for the budget started much earlier than usual this year. Last year, the first hearing was in early April, and before 2022, hearings were always held in May and June.
"The overall process is the same, we're just moving engagement up early," said Budget and Finance Committee Chair Reggie Harris.
Another change this year is how nonprofits and other third-party organizations can request city funding. The new process requires organizations to formally apply for a one-time grant, instead of lobbying council members directly.
Although this funding is less than 4% of the General Fund, it used to dominate public and council discussion during budget season.
The application portal for the new process opened Feb. 14 and will close March 24. The application is available on the city's website.
Presentations from each city department will happen throughout April.
More public comment will be available at regularly scheduled Budget and Finance Committee meetings in late May and early June, plus an additional public hearing June 5.
Harris anticipates passing a Budget Policy Motion April 19. The final deadline for budget passage is June 30, but Council will likely pass the budget June 21.
Two more public hearings are scheduled before the city manager and mayor release their budget proposal:
- Monday, March 20 at 5:30 p.m. at the Sayler Park Recreation Center (6720 Home City Ave)
- Wednesday, March 29 at 5:30 p.m. at the McKie Recreation Center (1655 Chase Ave)
See the administration's full presentation below (story continues after):
FY 2024 Admin Budget Presentation by WVXU News on Scribd
Understanding the city budget
Here are some common questions about the budget process to help you understand the discussions.
Where can I see budget information online?
Documents are published on the city website under the Finance & Budget page: Cincinnati-oh.gov/finance/budget
In a couple months, that page will include the first draft of the budget (from the city manager and mayor). Once council passes a final budget, the page will include an updated document with the final version.
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There are also links to prior years' recommended and approved budgets.
Why does a new budget start in July instead of January?
The city budget is based on fiscal year rather than calendar year.
- Fiscal Year 2024 (often abbreviated as FY24) begins July 1, 2023 and ends June 30, 2024.
- Fiscal Year 2025 begins July 1, 2024 and ends June 30, 2025.
Where does city income come from?
The majority of city revenue comes from income taxes, also called earnings taxes. Usually that makes up as much as 72% of overall revenue; this year (like the last couple years) is unique because of federal stimulus. Here's the breakdown of revenue for FY23:
- Earnings taxes: 61.2%
- American Rescue Plan Act: 15.3%
- Property taxes: 5.2%
- State Shared Revenue: 2.6%
- Casino tax: 1.7%
- Investments: 0.7%
- Parking meter: 0.3%
- Other revenues: 13.0% *
* Includes: license and permit fees; admission taxes; short-term rental excise taxes; buildings and inspections fees and permits, etc.
The current city income tax is 1.8% of gross earnings and the revenue is divided into three categories:
- 1.55% for the General Fund
- 0.15% for permanent improvements (capital)
- 0.1% for maintenance of city infrastructure
The most significant change to city revenue in recent years is a reduction in the Local Government Fund (State Shared Revenue). The state imposed cuts to this fund about 10 years ago; the amount allocated to Cincinnati in FY22 ($11.7 million) is a 72% reduction compared to 2011 ($40.7 million).
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What makes up most of the budget?
82.7% of the General Fund goes to personnel and benefits. And, 84.2% of city employees are represented by labor contracts negotiated with a union.
Who decides how to spend taxpayer money?
The process begins with City Manager Sheryl Long, who will work with her team to prepare the first draft of a budget. That draft is passed along to Mayor Aftab Pureval, who has the option to make any changes before it goes to Council.
Council has ultimate authority over the budget and must reach a majority agreement (five of nine council members) to approve the spending plan.
How does a biennial budget work?
The city budget technically covers two years at a time, but Council still votes to approve funds every year.
Last year was a "budget update" to account for differences in actual revenue compared to expected revenue. Practically speaking, however, it was an entirely new budget prepared by an entirely new administration.
This year, Council will approve a biennial budget for FY24 and FY25.
What's the difference between operating and capital budgets?
The operating budget includes the services provided by the city, like police officer patrols, filling potholes, trash collection and operating the water treatment system. It includes wages for city employees and the cost of supplies needed to deliver services. The operating budget includes the General Fund, where City Council has the most flexibility in funding decisions.
General Fund dollars can be used for capital projects, but capital dollars cannot be used for operating.
The capital budget covers purchasing or improving city assets like buildings and vehicles. It includes assets that cost at least $10,000 and last at least five years. The Capital Budget includes some cash and some borrowing.
RELATED: Public input on the Cincinnati budget is starting early this year
The city can also take on debt for capital projects, but the amount of debt is limited by the amount of revenue expected from taxes — the city has to bring in enough money to make payments on the debt. If the city wanted to take on more debt for capital projects, Council would have to approve an increase in taxes. Right now, the city issues bonds based on property taxes.
The city can't issue bonds on assets not owned by the city; that also applies to city-owned buildings with long-term leases like Music Hall's 100-year lease. Playhouse in the Park is another example of a city-owned building that can't use bonded capital for improvements because of long-term use agreements.
A portion of income tax revenue is set aside for the Capital Budget: 0.15%, which equals about $9 million each year for FY22 and FY23. This is cash-in-hand the city can use to pay for capital projects, which could include buildings not owned by the city.
