A SORTA Dilemma

Cincinnati’s transit agency, the Southwest Ohio Regional Transit Authority (SORTA), is facing a dilemma common to many other transit agencies. Transit ridership is dropping, and fare revenue is dropping even more. Should it raise fares, which will accelerate ridership declines, or ask voters to approve more taxes to cover a $6.4 million budget deficit in order to maintain transit service?

SORTA’s problems have been worsened by the city’s decision to build an idiotic streetcar line. The city claimed the streetcar was built under budget, but that’s a distortion of reality. It was supposed to cost $110 million for 4.5 miles and ended up costing $148 million for 3.6 miles. Of course, the last approved budget before completion was $149.5 million, but it still cost far more than was projected when the city decided to build the line.

In any case, that’s $148 million that could have been used to ease SORTA’s budgetary woes today. On top of that, operating the streetcar costs SORTA more than $2 million a year, and fares cover only 14 percent of that. Counting some capital costs, the streetcar added $2 million to SORTA’s expenses in 2016, and probably even more in 2017. In short, the operating expense plus 10 percent of the cost overrun for the streetcar would have been enough to make up SORTA’s projected deficit.

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In 2016, a half-cent sales tax generated $80 million in revenue in Hamilton County, which SORTA wants to tax to make up its deficit. That means it only needs 4 one-hundredths of a cent to make up its deficit. But it is planning to ask for one-half to one cent, which will give it loads of money to spend on grandiose new projects that will then increase its future operating deficits.

What will it do with all that money? Why should taxpayers be obligated to cover the increasing losses of a dying industry? Cincinnati voters should be aware that the real problem with transit is not that SORTA doesn’t have enough money. Instead, the problem is that money has been and continues to be spent in the wrong places.

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About The Antiplanner

The Antiplanner is a forester and economist with more than fifty years of experience critiquing government land-use and transportation plans.

5 Responses to A SORTA Dilemma

  1. prk166 says:

    According to the new York Times SORTEd problems are not due to their bad decisions. No, SORTA’s issues are not their fauot. SORTA has money problems because of the #kochapoclypse .

    Now I’m just waiting for the BUT to admit they believe in the flying spaghetti monster and blame the lack of evidence on people like Mr. Otoole

  2. MJ says:

    A $6.4 million operating deficit is not really a big deal for a metro area the size of Cincinnati (around 2 million people). This is something that could be easily overcome with a modest fare increase or, as Randal mentions, a miniscule tax increase.

    The larger issue seems to be that SORTA is using the deficit as a stalking horse to pursue a much larger tax increase, which will ostensibly be used for rail projects or other large capital expenditures. That can best be described as either opportunist or simply dishonest, depending on your politics. There is no way that a transit agency that size can find a good way to spend another $70-75 million per year on operations. If there were large, unserved markets or gaps in service, the agency would have already pursued them within the bounds of its own budget.

  3. LazyReader says:

    Scrambling to cover debts you invoked by spending with raised tax money now your raise taxes to cover deficits to spend on something that’ll raise your deficits even more
    Rock, Paper, Scissors……shit

  4. LazyReader says:

    It’s a good thing Baltimore doesn’t call it’s transit agency “Baltimore Union Southern Transit” or BUST

  5. JOHN1000 says:

    We went to Cincinnati last summer – first time there.

    Stayed in a beautiful hotel in the heart of downtown. Really enjoyed the city; walked a lot; went to breweries, zoo, the Roebling Bridge, ballparks, etc.

    Never even knew a streetcar existed until I got stuck behind one going about 5 mph for several blocks. Did not see anyone getting on or off.

    A very, very unnecessary $140,000,000.00 rip-off of the taxpayers.

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