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Council members move to plug streetcar budget gap with increased parking fines, digital ad revenue

Posted at 4:24 PM, Jun 07, 2019
and last updated 2019-06-07 16:42:21-04

CINCINNATI — With a budget deadline looming and streetcar funds coming up short, three City Council members believe they have a solution to the struggling transit system's financial problems.

In a motion filed Friday, councilmembers David Mann, Chris Seelbach and Greg Landsman proposed raising parking fines, reducing the transit authority's direct costs and banking on future digital advertising revenue to plug a $1.15 million hole in the streetcar's operating budget for fiscal year 2020.

If approved by City Council, the plan would include these adjustments to the streetcar operating budget:

  • Raise the fine for parking in a "No Parking" zone from $50 to $60, generating $400,000.
  • Raise the fine for parking meter expiration from $45 to $50, generating $200,000.
  • Include digital advertising revenue, generating $501,669 in 2020 revenue.
  • Adjust transit authority contribution to operating expenses by $50,000.

The Southwest Ohio Regional Transit Authority oversees streetcar operations on the city's behalf.

On Monday, City Manager Patrick Duhaney briefed the council's Budget and Finance Committee on the projected streetcar budget gap, proposing changes in parking permit costs and violation fines as well as a change to the city's admissions tax policy as possible solutions.

"None of these options come without heartburn," he said then.

The largest contributing factor to the council members' plan — future revenue generated by digital advertising signage located at transit stops throughout the city — remains uncertain. Landsman questioned city administrators during Monday's budget meeting, asking why the signs, which were ordered last year, hadn't been implemented.

"This was revenue we were supposed to realize last year," he said.

Duhaney also offered a revision to the city's admissions tax policy as a funding solution. According to the city tax code, certain nonprofits are exempt from paying a 3-percent tax on admission sales for events, performances or attractions they host, such as the Cincinnati Zoo and the Cincinnati Symphony Orchestra. Removing that exemption, Duhaney projected, would provide roughly $1.5 million in additional revenue.

Leaders from multiple Cincinnati-based nonprofit organizations spoke in opposition to removing their exemption from the tax during Wednesday's City Council meeting.

In order to be considered in time for the city's June 30 budget deadline, city administrators must submit an ordinance making these changes by Council's June 17 Budget and Finance Committee meeting. First, though, City Council must approve Mann, Seelbach and Landsman's motion. The earliest that can happen is next week.

Ohio state law stipulates that transit systems must provide a balanced budget by the start of each fiscal year.