Politics

Capital Funds and Operating Funds

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CincyStreetcar.com

Q: Can the City of Cincinnati use Capital Funds to pay for city employee’s salaries?

Lea Eriksen, City Budget Director

A: The sources of funding for the City’s General Capital budget include a dedicated portion of City’s Income Tax (0.15% of the 2.1%), a dedicated portion of the City’s Property Tax (5.36 millions out of 9.89 mills), and lease payments from the City owned Southern Railway.   All of these sources are restricted by City Charter and/or State Law to be used for “permanent improvement” purposes.  A permanent improvement is defined as an asset with a useful life of at least five years and a value of at least $10,000.   The City can not by Law use the funds from the General Capital budget to pay for operating expenses such as Police Officer salaries.

The sources of funding for the City’s General Capital budget include a dedicated portion of City’s Income Tax (0.15% of the 2.1%), a dedicated portion of the City’s Property Tax (5.36 millions out of 9.89 mills), and lease payments from the City owned Southern Railway.   All of these sources are restricted by City Charter and/or State Law to be used for “permanent improvement” purposes.  A permanent improvement is defined as an asset with a useful life of at least five years and a value of at least $10,000.   The City can not by Law use the funds from the General Capital budget to pay for operating expenses such as Police Officer salaries.

Subsidies and Transportation

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Some people oppose public transportation because, they say, it is too reliant on government subsidies.

Next time you see someone in a new General Motors car (a company owned by the Federal Government) purchased with a government rebate under the cash for clunkers program (a $4,500 subsidy per car) driving down a street that is policed, lit, and plowed by the City (with funds out of the Operating budget) and was constructed with funds from the Highway Trust fund (which would have gone bankrupt last year if not for a $9 billion bailout and will go bankrupt this year and next unless it is bailed out each year to the tune of several billion dollars) remember subsidies affect every form of transportation.

GM: 61% owned by the Federal Government
GM: 61% owned by the Federal Government