Plan To Fund City Streetcar Operations Hits A Roadblock

Apr 13, 2016

Credit Bill Rinehart, WVXU

It is back to the drawing board for how to pay for the first year operating costs of the Cincinnati streetcar system.  

City Council was expected to vote Wednesday on a plan to fund the estimated $4.2 million expense.  

But council member Kevin Flynn who voted for the ordinance on Monday changed his vote Wednesday during the council meeting.  He is concerned about $550,000 of contingency built into the funding proposal.  That is in case revenues from streetcar fares, naming rights and advertising come in below projections.

"When I voted for continuing the streetcar, I said we would not be using the general fund for the streetcar," Flynn said.  "This ordinance uses $550,000 that was not part of the incremental dollars of parking revenue for the first year's operations of the streetcar."

City Council did approve the measure with five votes.  But Mayor John Cranley threatened to veto it and it takes six votes to override a veto.  He said the streetcar supporters on council need to figure it out.

"The six of you voted to proceed with this project, you guys need to figure out how to pay for it," Cranley said.  "The administration did, in my opinion, make a recommendation to this council that was consistent with the policy that the council adopted."

Cranley did not have to use his veto stamp.  Instead a council majority voted to essentially "unpass" the plan and refer it back to the Budget and Finance Committee.

In 2014, Council increased parking meter rates and enforcement hours in Downtown and Over-the-Rhine to help pay for streetcar operations.  The city has been collecting that additional money since January 2015, and setting it aside for streetcar operations when passenger service starts in September.

In the proposed operating plan, city officials used some of that parking revenue to pay for streetcar start-up costs.  Flynn said that start-up money should come from the streetcar construction budget, and not operating funds.  He said that would free up some of the parking meter money to cover the contingency funding without using general fund revenue.  

Council member Yvette Simpson said using construction money right now comes with some risk.

"We will make sure the contingency, once construction is done, is transferred," Simpson said.  "Pulling the contingency out now has some consequences that maybe you haven't thought about."

Officials in Washington, D.C. could have some say in whether the city's contingency money can be spent before construction is fully complete since federal money is being used for the project.  

Council's Budget and Finance Committee could hold a special meeting Monday to continue the discussions.