SORTA Releases Streetcar Operating Costs

Lowest bids $7M apart; union employees would go over budget

The Southwest Ohio Regional Transit Authority today released the dollar amounts for the two lowest bids for the first ten years of streetcar operations. The names of the bidding companies were not released, per SORTA's assertion that it would compromise the competitive bidding process. You can read the bids here.

One bid, called the management scenario, would involve a management company using SORTA employees in the Amalgamated Transit Union to run the streetcar, while another, called the turnkey scenario, would let the management company hire its own employees.

The bids look to be politically tricky for Democratic streetcar supporters, who have pushed hard for a union-friendly contract. The turnkey scenario comes in just under the $47,088,828 the city has said it wants to spend over the first ten years of the streetcar at $46,972,813. The management scenario, however, comes in over that amount at $54,933,160. In the first year, the management contract exceeds the streetcar's $4.2 million budget by $500,000, while the turnkey proposal comes in about $160,000 under budget. The bids give numbers for a five-year contract plus an optional five-year extension.

Mayor John Cranley, who campaigned on opposition to the streetcar, has said he supports cutting frequency of service for the streetcar should it go over budget. However, he and other Democrats on Cincinnati City Council support the management bid because it would utilize unionized employees.

Some of the cost overruns in the management bid are attributable to benefits packages offered to union employees. However, employees under the management scenario wouldn't be eligible for state pensions. The ATU could unionize the turnkey bidder's selected employees after they are hired, however, though they still wouldn't get the state pensions.

Cincinnati City Council looks poised to vote on the two options next week.

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