Officials grilled on city's plans to fix finances

Proposed Docks sale, rate hikes for water and sewer questioned

2/8/2011

Vincent Smith questions whether the $2.15 million that a Chinese group proposes to pay for The Docks is the best price.

THE BLADE/AMY E. VOIGT
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Toledo residents took advantage of a City Council budget forum to give Bell administration officials a piece of their minds on the proposed water and sewer rate increases, the proposed sale of The Docks, and economic development that will be affected by the city's 2011 budget.

The news coming from the Bell administration at the town hall meeting held last night at the Toledo-Lucas County Main Public Library downtown was a repeat of earlier warnings that the city must watch its spending closely.

"As a result of recent cuts, we haven't been able to do the things we want to," George Sarantou, chairman of City Council's finance committee, said at the start of the meeting, which attracted about 30 people, many of whom were city officials.

The budget, based on a projected $229.9 million in general fund income, must be balanced and it must be approved by March 31, Mr. Sarantou said.

City Finance Director Patrick McLean said revenue from taxes, fees, and other sources has shifted upward, but the picture is not "rosy by any stretch of the imagination."

No financial help is expected from the federal or state level, either, city officials warn, based on announced cuts from Columbus and Washington, including the loss of community block grant funds.

The proposed sale of The Docks restaurant and entertainment complex along the Maumee River drew sharp questioning as to whether the revenue from the $2.15 million proposed by a group of Chinese investors might be outweighed by the loss of income from rent the complex provided.

"Do you really think you are getting the best price?" asked Vincent Smith. "Once you sell it, you won't have that revenue coming in that you do now."

Steve Herwat, deputy mayor of operations, said the city loses $13,000 a month rent it had received from Navy Bistro and other restaurants that Tom Cousino closed late last year. The sale will cut those losses and allow the city to pay off $1.6 million in bond it owes on the complex. "Right now, we have to take that [bond repayment] money out of the general fund," he said.

Mr. McLean said the city took outside investors' interest in purchasing The Docks as a "vote of confidence" in the city's future.

Another questioner asked about offering inducements to get city workers to live inside the city limits, but Mr. Herwat said the city can't afford to offer such lures. And, he said, city employees who live outside the city limits still pay the Toledo's income tax.

The city also examined levying a tax on the sale of alcohol and tobacco products, but with the current anti-tax mood in Columbus, little possibility exists for the city to get the Ohio Legislature to give its approval to such a move, Mr. Herwat said in addressing another question.

Linda Detrick-Jaegly, economic development and marketing manager for United North, criticized city response time to requests for facade grants and economic development loans for small businesses.

She said her organization assisted with six applications last spring, and none has been acted on.

Mr. Herwat blamed the delay on a lack of staffing in the city's department of neighborhoods.

Tom Crothers, director of public utilities, outlined issues the city has maintaining 1,100 miles of water lines and 1,100 miles of sewers, as well as maintenance issues with the water treatment plant.

The city proposes increasing rates each year through 2014 at the rate of 9 percent for water, 6.75 percent plus an additional fixed amount for sanitary sewer, and 7.5 percent for storm-water rates to address the needed upkeep.

"Everything we do is big and expensive," Mr. Crothers said, reinforcing the need for funds.

In response to questions, Mr. Crothers said his department is making two other changes that will affect customers: monthly billing for water and sewer by 2012, and more operators in the department's call center to reduce waiting time for customer calls. The current waiting time is "horrible. It's unacceptable," he said.

Last night's meeting, sponsored by new District 4 Councilman Paula Hicks-Hudson, is to be followed tomorrow from 6 to 8 p.m. at East Toledo Family Center, 1020 Varland Ave., sponsored by District 3 Councilman Mike Craig, and at 6 p.m. Feb. 17 at the University of Toledo's Driscoll Alumni Center, sponsored by District 5 Councilman Tom Waniewski.

Contact Jim Sielicki at: jsielicki@theblade.com, or 419-724-6050.