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Cincinnati City Council approves $150 million in bonds to finance COVID-19 response

Posted at 12:42 PM, Mar 20, 2020

Editor’s note: With our coronavirus coverage, our goal is not to alarm you but to equip you with the information you need. We will try to keep things in context and focus on helping you make decisions. See a list of resources and frequently asked questions at the end of this story.

CINCINNATI - City Council met in emergency session Friday and voted unanimously to permit the administration to borrow up to $150 million to spend "if and only if necessary" to fund the city's response to the coronavirus crisis.

Acknowledging that the city has a $48 million reserve, Mayor John Cranley said the city wants to build an emergency reserve to preserve basic police, fire, public health and sanitation services in case a long-term emergency would deplete existing funds.

Cranley said the city has enough cash to provide water and sewer services for more than one year and "can guarantee" continuing those services for Hamilton County residents.

"Today's step is perhaps more than is necessary, but it's better to be overprepared than underprepared," Cranley said.

Cranley said it's important to build a reserve now while lenders are willing and interest rates are low.

"That could change," Cranley said, referring to the possibility of a worsening crisis.

Citing the city's high bond rating, Cranley said the city expects to get an interest rate "about 1.5%."

Cranley said he thought any spending would be a "small amount" and could be made up by cuts in the general fund.

"I do not want to spend this money. We do not want to spend this money," Cranley said. "I’m not worried, though, if things get really bad, we might agree to spend some of it."

RELATED: City announces first confirmed cases of coronavirus.

Cranley said the state commissioner and the state tax commissioner would have to approve the city's borrowing.

Councilmember P.G. Sittenfeld challenged the need for issuing new bonds on several grounds and wondered if the city's impetus is "free and easy money" available from lenders now.

Sittenfeld cautioned about the city's ability to pay it back without large cuts to the operating budget in the future.

"We're borrowing an amount of money we think we might need," Sittenfeld said. "That money could be gone in five years. We could be talking about $10 million" in cuts to the operating budget to pay it back after that.

Sittenfeld also asked if the city could get federal or state funds or consider ways to generate new revenue. Cranley expressed doubt, saying there are "multiple requests" for state and federal funds.

Finance Director Karen Alder said the city could cancel the bonds if it determines they are not needed. Alder said it would cost $100,000 to issue bonds.

In other votes:

  • Council referred Councilmember Jeff Pastor's motion to make metered parking free throughout the city for 40 days. Councilmember Betsy Sundermann and others asked for time to consider the financial impact. The city reported that it collects a monthly average of $336,000 from meters and $550,000 from parking tickets.
  • Council approved transferring $1 million from reserves to pay for Personal Protective Equipment (PPE) for city police, fire and health-care workers.

Council also discussed canceling Metro bus fares and offering free rides during the crisis, but delayed any action.

Find more coronavirus/COVID-19 hotlines and resources below:

Ohio

  • Department of Health COVID-19 hotline: 833-4-ASK-ODH
  • See ODH’s COVID-19 resources here.

Kentucky

  • State COVID-19 hotline: 1-800-722-5725
  • See the Cabinet for Health and Family Services coronavirus resource site here.

Indiana

  • SDH Epidemiology Resource Center: (317) 233-7125 or (317) 233-1325 after hours, or e-mail epiresource@isdh.in.gov
  • See more information for coronavirus in Indiana here.

What is coronavirus, COVID-19?

According to the World Health Organization, coronaviruses are "a large family of viruses that cause illness ranging from the common cold to more severe diseases such as Middle East Respiratory Syndrome (MERS-CoV) and Severe Acute Respiratory Syndrome (SARS-CoV).

A novel coronavirus, such as COVID-19, is a new strain that has not been previously identified in humans.

COVID-19 was first identified in December 2019 in Wuhan City, Hubei Province, China and has now been detected in 37 locations across the globe, including in the U.S., according to the CDC.

The CDC reports the initial patients in China have some link to a large seafood and live animal market, indicative of animal-to-person spread. A growing number of patients, however, did not report exposure to animal markets, indicating the disease is spreading person-to-person.

What are the symptoms? How does it spread?

Confirmed cases of COVID-19 have ranged from mild symptoms to severe illness and death, according to the CDC. Symptoms can include fever, cough, shortness of breath.

The CDC said symptoms could appear in as few as two days or as long as 14 days after exposure. It is similar to the incubation period for MERS.

Spread of the virus is thought to be mainly from person-to-person. Spread is between people who are in close contact with one another (within about six feet). Spread occurs via respiratory droplets produced when an infected person coughs or sneezes. The droplets can land in the mouths or noses of people who are nearby or possibly be inhaled into the lungs.

According to the CDC, it could be possible for a person to get COVID-19 by touching a surface or object that has the virus on it and then touching their own mouth, nose or possibly their eyes. This is not thought to be the main way the virus spreads, the CDC said.

The disease is most contagious when people are the sickest and showing the most symptoms.