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Cincinnati's Budget Deficit Is Growing

City of Cincinnati

Cincinnati City Manager Harry Black announced Wednesday the projected general fund budget deficit for the next fiscal year has ballooned to $25.1 million.

Earlier this year it was projected to be between $7 and $9 million.

The city revised the estimate after getting new revenue forecasts from the University of Cincinnati Economic Center.  The new fiscal year begins on July 1.

Black said in a memo, to Mayor John Cranley and council members, that the city is lowering its income tax estimate for the next several years.

"Aggregate net income tax revenues are projected to grow at 2.3 percent annually on average from FY2017 through FY2022, slightly lower than the average annual rate from 2003 to 2016," the UC report stated.

Black said because of the downward trend in current year income tax collection, the city is lowering project income tax collection by $14.7 million dollars.

"I am hopeful that the reduction in income tax receipts is only a one time decrease and the city's receipts continue to grow into the future as the economic forecaster predicts," Black wrote in the memo. "However, I am committed to presenting to the mayor and city council a structurally balanced FY 2018/2019 biennial budget in May."

The deficit could grow even larger because the latest estimate does not include proposed state revenue reductions to local governments.  Those numbers will not be finalized until Ohio lawmakers approve the state budget in June.

The city manager has already launched a number of steps to save money.  Those include:

  • A position freeze announced in November and asking departments to create vacancies;
  • Reviewing all non-personnel spending to make sure it is necessary;
  • Shifting some general fund bond obligations to other sources including a bond retirement fund and the city capital budget;
  • Asking non-safety departments to cut 10 percent from their budgets; 
  • And asking safety departments to cut 3 percent from their budgets. 

Black said in the memo his goal is to minimize direct service impacts on residents as departments are making reductions.

City council's budget and finance committee will get a full update on the UC study during a meeting Monday.


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Jay Hanselman brings more than 10 years experience as a news anchor and reporter to 91.7 WVXU. He came to WVXU from WNKU, where he hosted the local broadcast of All Things Considered. Hanselman has been recognized for his reporting by the Kentucky AP Broadcasters Association, the Ohio Society of Professional Journalists, and the Ohio AP Broadcasters.