My Letter to Mayor Mallory

Below is the text of the letter I delivered to Mayor Mallory today:

March 18, 2011

Mark Mallory
Mayor
City of Cincinnati
801 Plum Street
Cincinnati, OH 45202

Re: Streetcar Support

Dear Mark:

As you are aware, I have been an outspoken supporter of the streetcar plan from the beginning. In spite of overwhelming public opposition to the project, I had been convinced that the advantages of moving forward outweighed the potential challenges that we faced. Moving communities forward sometimes requires leadership that runs against “current” public opinion. I get that, and I was willing to take the slings and arrows that come from supporting a plan that I was convinced was workable.

We have known all along that the plan we were working on had significant challenges. Up to now, I was willing to put my concerns on the “back burner” with the understanding that we could face the tough decisions and make the plan workable.

No longer can I do that. That is why I am writing to inform you that I will not vote in favor of any of the streetcar project legislative items during my remaining brief tenure on Council, and wanted to communicate to you my reasoning.

First and foremost, Governor Kasich’s opposition to the State’s commitment of $51.8 million leaves an enormous hole in the streetcar’s first phase, budgeted to cost $128 million. It is obvious to me, and it should be obvious to everyone else, that the current streetcar plan no longer works. A $52 million hole (40% of the entire project cost) cannot be overcome without tax increases, a raid on the capital budget or more debt financing. Further, we cannot rely on the uncertainty of future federal grants. If we were to reduce the scope of the project, the result would be to minimize the economic impact of the investment. I do not support any of these measures in that they are not fiscally responsible. Therefore, I will not vote to move forward on any streetcar measure and hope that Council will put the project on hold until a new financing plan is in place, allowing Council members and voters to understand the entire package.

Additionally, after nearly four years of work, the Administration still has not produced for public review a plan to fund the operating costs for the streetcar. It has been estimated by our consultant, way back in 2007, to cost somewhere between $1.9 million to $2.4 million a year. This expenditure cannot be met by the General Fund, especially given our ongoing budget deficit. We should not move forward on approving construction or any other element of the streetcar project until this essential operating element is known in order to protect the general fund. Failure to understand and budget for this expense completely undermines the credibility of the project and officials who support it.

Additionally, and maybe most importantly, actions taken by you and the majority of Council have shown that we cannot be trusted to oversee a project of this magnitude. The most recent example of this is our repeated failure to address the fiscal mess that is the City’s budget.

During your entire tenure as Mayor, you have proposed, advocated, lobbied and supported budgets that are structurally imbalanced and a majority of Council has played along. The most recent budget (fiscal 2011), approved in December of 2010 under your leadership, made a mockery of the budget process. Council “balanced” a budget with a deficit of $59 million through smoke and mirrors, avoiding what the City Administration had said for two years would be necessary -- the $20 per month garbage fee and the layoffs of 275 police and fire personnel.

You have opposed all efforts to transform City government in ways that would structurally balance the budget. You have opposed managed competition for garbage collection and other public services, which would have reduced costs to taxpayers. You have opposed even studying the idea of merging Cincinnati Police with the Hamilton County sheriff, which could have saved the City millions. You have opposed efforts to have a local hospital or private entity to administer the City’s health clinics. Instead you cling to a status quo that the City tax base cannot sustain.

Meanwhile, we have seen no plan from you to structurally balance the budget – other than with higher taxes and the less safety services. Clearly, this path would leave the City’s financial condition worse off as businesses and middle class tax payers head for other communities with lower taxes and better services.

During the last budget, you opposed even a modest plan for managed competition of public services. Your opposition caused a responsible budget plan to fall apart. Cynically, you opposed that plan while privately you were planning to appear undercover as a public services employee on a reality television show.

The producer of that show was quoted on March 6, 2011 in the Cincinnati Enquirer as saying that, given there might be public services employee layoffs resulting from the budget, “We had to wait until after the budget was settled”.
Despite your denials to the contrary, this admission from the producer is evidence that you put your desire for a good television appearance over the financial well-being of our City.

The Cincinnati Enquirer said it well in its March 6, 2011 editorial titled “The dry fountain a sign of city’s poor management.” The Enquirer stated, “The money’s gone because city officials have for years neglected their central task of making sure the budget is sound and structurally balanced. Caving in to political pressures, they resist real spending reforms. Instead they use sleight-of-hand to patch together sham ‘balanced’ budgets that quickly unravel, forcing them to nibble and slice out of desperation.”

Yet, notwithstanding these repeated failures of leadership, you want the public to trust you to lead the City of Cincinnati in building and operating a streetcar system? Is it any wonder that the public is opposed to this ambitious project? Simply put, the public does not believe that the project will be a good investment as many of us elected officials have explained, but rather look at the failures of the current budget and see a program destined to further drain the resources of the City.

The public sees only your unwillingness to cut spending, your unwillingness to save money, and your unwillingness to make difficult choices to reduce expenses. But when it comes to the streetcar what does the public see? They see your willingness to spend enormous amounts of money that the public believes we cannot afford.

Therefore, I will not vote to move the project forward in my remaining days on Council, which is why I requested that the two streetcar account items be held on the Council calendar at our last meeting. I suggest you put the streetcar project on hold and I challenge you to immediately lead the Council and the Administration in developing a structurally balanced budget plan.

Once you have done this hard task of leading transformative change, then you will have earned credibility with the public to revisit the economic promise of the streetcar. At that time, you can make your case across the City for the investment in a streetcar system, armed with a complete financing plan for its construction and operation (if possible given the recent major loss of state funding).

When you start leading in this manner and delivering the critical changes our City needs, I will again be ready to help the cause and expect that a Council majority would then be willing to review all of the streetcar economics and details and provide final approval of the program.

Sincerely,

Jeff Berding
Council Member
City of Cincinnati