By Joshua Benton
Blade Staff Writer
The city’s expenses for the Jeep project are under control and will leave Toledo in strong financial condition, city officials told a council committee yesterday.
“Cost containment for Project Jeep is in full effect,” said Ken Dobson, who is negotiating relocation packages for displaced busines ses at the Jeep site.
Mr. Dobson and Jeep project coordinator Bob Reinbolt said that the giant leap in the city’s estimated costs – from about $35 million a year ago to about $75 million now – happened because of poor original estimates, and that the projected cost has stayed stable for about four months.
“I feel confident that we will be able to bring this in to you under budget by a few hundred thousand dollars,” Mr. Dobson said.
Mayor Carty Finkbeiner held a news conference Tuesday at which he criticized an article in Sunday’s Blade that reported the increase in costs, and that the city will have to borrow millions to give DaimlerChrysler AG the incentive package to expand its Toledo Jeep plants.
But Mr. Dobson and Mr. Reinbolt said that the debt payments would not be overly painful for the city and well worth the economic benefits: keeping 4,900 jobs for Jeep, as well as encouraging industrial investment in North Toledo.
Councilman Rob Ludeman said that the original too-low estimates “hurt us in spirit” as the costs climbed skyward. “Those first estimates were so flawed,” he said.
Saying he had been frustrated with the cost overruns, Councilman Bob McCloskey said the money might have been better spent elsewhere.
“I’m not sure we would have been better off letting Jeep go to Michigan,” Mr. McCloskey said, letting the millions of dollars go to smaller economic development projects.
But Mr. Dobson said that would not have been a more efficient way to retain jobs. “It would have cost two, three times as much to attract the amount of jobs that we would have lost losing Jeep,” he said.
Mr. Reinbolt said that, in a worst-case scenario, the city would have to borrow just under $18 million in a low-interest loan from the federal government. However, he said that sum would almost certainly be reduced, probably through the sale of city-owned land in Monclova Township or Whitehouse.
“I believe it can be reduced to the neighborhood of $10 million,” he said.