March 15 (Bloomberg) -- Cincinnati’s plan to privatize parking is being challenged by six city residents who claim the March 6 ordinance should be put to a public referendum.
The measure places the Port of Greater Cincinnati Development Authority in charge of street parking for 30 years and off-street parking for 50 years, giving it the ability to contract with private operators. In exchange, the authority is to pay Cincinnati about $92 million now and an estimated $3 million annually for 30 years.
The city council classified the ordinance as an emergency measure needed to close a budget hole and save 344 jobs, including 269 police and fire department positions. The objectors say that’s a ruse to avoid a public vote on the deal, and they want a judge to block the deal until it can be placed on the ballot in November.
“Don’t believe any argument from the city that this is doom and gloom, because it’s not supported by the evidence,” Curt Hartman, an attorney for the opponents told Hamilton County Judge Robert Winkler at a hearing today in Cincinnati. It’s “a naked attempt by the city leadership to deny the people the right to vote.”
Similar disputes have arisen elsewhere in the U.S. as state and local governments consider privatizing prisons, lotteries, airports and roadways to raise revenue and balance budgets.
Chicago faces a lawsuit over the 99-year, $563 million lease of four of its downtown parking garages to an entity controlled by two Morgan Stanley investment vehicles.
The Ohio Supreme Court has said it will consider whether a nonprofit group is eligible to challenge the use of profits from the state-owned liquor business to fund a private economic-development program backed by Governor John Kasich.
Cincinnati has characterized the parking dispute as a matter of charter interpretation and called the opponents’ position legally incorrect. Eleven percent of Cincinnati’s downtown parking spaces are affected by the privatization plan, according to a court filing by the city. Cincinnati Assistant City Solicitor Terrance Nestor said the present estimated value of the deal is $207 million.
Winkler issued a temporary restraining order on March 6 to keep the plan from going forward until he can decide whether it must be put to a referendum. He heard 90 minutes of argument today without immediately rendering a decision.
“The ordinance shouldn’t be on the ballot,” Nestor told Winkler today. “Ohio law provides for emergency legislation that is not subject to a referendum.”
If voters don’t like what the nine-member city council has done, they can go to the polls and elect new councilors, Nestor said.
The case is McQueen v. Dohoney, A1301595, Hamilton County, Ohio, Court of Common Pleas (Cincinnati).
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