Akron's 2017 Budget Reflects Reality: The Massive Sewer Project Will Impact Generations to Come
Akron City Council on Monday approved a $966 million spending plan, made up of a $550 million operating budget and a $375 million capital budget.
Akron Beacon Journal reporter Doug Livingston, speaking with WKSU's Jeff St.Clair says, the budget is dominated by one massive construction project, and that will likely continue for many years.
Doug Livingston says the $1.1 billion sewer project consumes about two-thirds of the money for capital projects slated for this coming year. But, he says," the administration, the public service department, the City Council, the finance director, the water department, have all promised not to increase any of the water/sewer rates until 2020."
He notes that "the public service department has upped the billing fee by 25 cents per month, which adds up to $250,000 in additional revenue per year. Customers in Akron are already paying 60 percent or more than they were a couple of years ago."
The administration is very cognizant of the pressures that are put on the Akron taxpayers to fund this project. They’re looking for other ways to raise revenue.
The city, according to Livingston, remains very cash-strapped.
"They’ve increased rental registration fees for landlords in the city; they’ve upped fire inspection fees, they’re basically looking for anywhere else they can raise revenue," says Livingston.
So what does the current budget says about Akron’s overall financial health and prospect for growth?
Livingston says the city is looking for help from the private sector.
"They don’t have the capital or the resources to spur the investment. If you look at the recent housing plan proposed about a week ago, they’re looking for private investors, builders, and homeowners to invest in their communities and give them a tax break to do so."
Without having the money to rebuild roads or build new homes to attract young professionals, Livingston says, "the administration is looking for private partnerships to grow the city without having the resources to do it ‘in house.'"
Livingston says the 2017 budget approved Monday did realize around $2.6 million in cost savings compared to the budget proposed last month by Mayor Dan Horrigan.
"The majority of the savings on the operating side are from lower-than-expected contracts with engineers who are designing this massive sewer project mandated by the federal government, U.S. EPA, Ohio EPA, and the courts by 2028."
On the capital side, the savings come through enviable financing for the sewer project, 45-year loans at nearly zero percent. Essentially, says Livingston, "It’s free money."
But, he adds, the long-term loans stretch out the burden of the sewer project for generations of Akron taxpayers.
While "the city admits the project is unaffordable, they want to make it less unaffordable."
Multiple generations who will be shouldering the cost of the sewer overhaul will be enjoying the benefits of a clean river with zero raw sewage effluents.