Union Terminal deterioration could extend levy on taxpayers - Cincinnati News, FOX19-WXIX TV

Union Terminal deterioration could extend levy on taxpayers

Posted: Updated: June 20, 2013 06:38 PM
CINCINNATI, OH (FOX19) -

Hamilton County voters may see a familiar levy return to the ballot in 2014. The Cincinnati Museum Center CEO submitted a letter to the county announcing the possible pursuit of a May 6, 2014 operating levy.

The Museum Center has been the recipient of levy revenues since 2004.

"To not rely on that levy requires the full restoration of the building. This is not a chicken or egg proposition," Cincinnati Museum Center CEO Douglass McDonald emphasized. "The first thing that has to be done is Union Terminal has to be restored. When that's done we have options. Until that's done we do not have other options."

A 2010 contract between CMC and the County states "CMC agrees that it will not seek additional operating levy support beyond this current voted Levy" which expires in December of 2014, but it also goes on to recognize "the need for large scale capital construction, repair and renovation outside of the scope of the current operating levy," which has yet to be realized. It further states CMC will work with the County to develop a proposal, if any, for a capital levy request. CMC proposed a capital levy in 2011, but it did not garner the support of commissioners.

"There is an acknowledged requirement that the Union Terminal has to be restored for us to be able to reduce the levy support we receive from Hamilton County," McDonald stated.

According to Museum Center spokesperson Elizabeth Pierce, the paperwork was filed to be able to meet deadlines in the levy review and approval process should they decide to move forward with an operational levy renewal request. Pierce says museum officials are committed to working with commissioners to find the best long term solution to the center's infrastructure concerns.

"If we don't file that letter we can't have a conversation for a spring ballot at a later point," McDonald explained.

The museum's current levy expires next year. The annual cost for the owner of a $100,000 home is $5.12. The levy generates roughly $3.3 million annually for operational needs including maintenance, utilities, and insurance payments.

Museum Center officials say ultimately Union Terminal is in need of a $150-$180 million dollar capital project to address problems in its aging structure. Funding for such a large project would require a longer-term levy, possibly a 30 year capital levy, which would generate the money needed through bonds up-front and be paid off over time. Instead, in recent years the county's operational levy has served as a Band-aid to maintain Union Terminal in the short-run.

"We've lived up to every part of our promise that's possible. We've raised the endowment money which we were asked to raise. We've increased our earned revenue. We've balanced our budgets. We've made for a very strong institution serving a million and a half people a year," McDonald said.

McDonald believes voters should be able to decide whether to support a renewed levy.

"The public supports Union Terminal," he said. "They support the Museum Center and we know they would approve this if the commissioners would allow them to vote on it."

 

TAX LEVY REVIEW

A mid-term report released by the Hamilton County Tax Levy Review Committee states "We believe that the Cincinnati Museum Center will continue to need funding from some source at the end of this levy in order to continue property maintenance."

The report suggests Commissioners consider amending the current two cycle levy limit "given the significant operating costs associated with the current disrepair of the building".

It goes on to state "the sizing of the current operating levy does not include capacity for any capital projects.

The current capitol renovation project is estimated at $163 million but increases to $214 million in 2016.

For a full list of county levy supported agencies visit the county website.

 

COMMISSIONER HARTMANN'S REACTION:

Commissioner Greg Hartmann says he is open to the idea of extending the operational levy and having the county's volunteer Tax Levy Review Committee research the option. Generally the TLRC review process takes about six months to complete.

"The bigger issue is the capital repairs need," Hartmann told FOX19. "Long term we need a real conversation about whether the expenditure of $200 million dollars is feasible for Hamilton County taxpayers."

Hartmann feels since the Museum Center is city-owned the City of Cincinnati ought to consider dedicating some of its anticipated $92 million in parking lease revenues to the center's capital repair efforts.

"We're going to have to have this conversation about the broken building," Hartmann said.

 

COMMISSIONER MONZEL'S REACTION:

Hamilton County Commissioner Chris Monzel says they are currently researching the levy request. He says right now his focus is on reducing the amount of property taxes county residents have to pay and says commissioners have to figure out the best way to do that in looking at the needs of Hamilton County citizens.

Monzel says he does have some concerns about sustainability considering the Museum Center is asking for another operational levy.

"It is a city owned building that the county tax payers are subsidizing," Monzel stated. 

Monzel recognized the good the Museum Center provides the community, but tells FOX19 he is concerned about whether or not it is something county tax payers should be supporting. He says they have until February of 2014 to decide whether or not to approve an operational levy for Union Terminal.

 

LEVY HISTORY

The Museum Center's original operational levy was put in place in 2004 with the agreement there would be two levy cycles.

"We thought that things might be different than they are today," McDonald said.  "We didn't know then that the steel throughout the entire building was rusting and pushing the brick off the façade."

In 2009, the Museum Center came forward with a capital levy request, but later revised it to an operational levy, ultimately cutting the levy back from its original amount.

A 2009 resolution states "the consultants and the TLRC recommend CMC should work closely with Hamilton County to implement a capital plan at the earliest possible opportunity," and that "Hamilton county commissioners fully support making the identified repairs to Union Terminal to move this vision forward".

Thus far $3.9 million in levy revenues have helped to fund "Project 1" at the Museum Center.

"Private donors don't give to an uncertain proposition to occur in an uncertain time frame for an uncertain result," McDonald said. "But when we have a definitive [capital] plan as outlined in the contract with Hamilton County and when that project has been designed private donors will step up and do their part."

Currently the TLRC is made up of 11 volunteers. This month the TLRC is working on a final recommendation for the Cincinnati Zoo levy which is due on June 28th and will be presented to commissioners on July 8th. The Zoo levy is up for renewal this November. 

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