Friday, August 20, 2010

Ballard Awards Politically-Connected ACS 50-Year Parking Meter Lease

Your parking rates are going to double, and a private firm with strong political ties to Mayor Greg Ballard's administration will make millions at your expense. Ballard's administration announced it will award a 50-year contract to ACS, the same company which played a keys role in the botched welfare privatization contract FSSA awarded to IBM and which the state recently terminated, to lease the city's parking meters. Under the terms of the lease deal, ACS will keep 80% of all parking meter revenues it collects, a percentage which will eventually drop to 50% in the latter years of the lease agreement. Deputy Mayor Mike Huber says ACS is getting 80% of the revenues because it will spend millions to replace all of the current parking meters and will pay the city $35 million up front. ACS will be allowed to double the parking rates Indianapolis residents pay over the next 2 years. After that, parking rates will be adjusted regularly according to the inflation rate. The city says it will eventually receive about $1.5 million in parking revenues from ACS; however, those payment levels will not be reached until many years into the 50-year lease agreement with ACS. The city says it currently collects about $750,000 annually in parking meter revenues. In addition to the higher metered rates, extended hours for parking at metered spots will require paying up to 9:00 p.m. to park. The lease also will extend to the operation of other city parking garages, including those operated by the CIB. Something doesn't add up in those numbers. I'll leave it to one of this blog's talented analysts to explain it.

I knew as soon as this deal was put out on the street ACS would get the contract just like I predicted it would get the state's welfare privatization contract. The firm formerly employed former FSSA Secretary Mitch Roob, who was running the department when the partnership it had with IBM was awarded the welfare privatization contract. Former Indianapolis Mayor Steve Goldsmith and CIB President Ann Lathrop both formerly worked for ASC as well. And last but not least, ACS's hired gun lobbyist is Barnes & Thornburg, the law firm that has effectively called all of the shots in the Ballard administration since he took office in January, 2008. The firm has been paid more than a million dollars to perform legal work for city-county government since Ballard took office, and it is under contract to provide personal advice to Ballard's office. At the same time, the firm has represented multiple businesses doing business with the city or seeking to do business with the city as a hired gun lobbyist. Joe Loftus, former deputy mayor under Goldsmith, lobbies the city on behalf of ACS.

The state's welfare administration contract became a huge black eye for the Daniels administration, which ended the long-term contract it entered into with IBM; however, it permitted ACS a continued role in the original contract running a call center operation in Marion, Indiana, which leases a building that is owned by a firm in which State Rep. Eric Turner and his son are the principal owners. The state is now engaged in a contentious lawsuit against IBM, which the state blames for the botched privatization of welfare services. Critics complained at the time of Roob's connection to IBM's partner as a former executive with the company. The Daniels administration claimed Roob recused himself from participating in the contract negotiations that involved his former employer but other insiders say it was no secret from the day he assumed his role as FSSA Secretary that he was going to deliver the contract to a consortium of private businesses that included ACS. Roob is very close to Barnes & Thornburg's Joe Loftus. Both worked together in the Goldsmith administration and Roob was instrumental in working on several privatization deals initiated by former Mayor Goldsmith.

The city says it plans to use the $35 million ACS will pay it up front for street and sidewalk improvements in the downtown and Broad Ripple areas only. The administration already plans to spend a half billion dollars it expects to receive from the transfer of the sewer and water utilities to Citizens Energy in the form of upfront payments and additional borrowed funds for street and sidewalk improvements. Citizens Energy has already stated it will seek higher utility rates to pay for the money it must borrow in order to pay the city $263 million as part of that deal. The city also plans to leverage PILOT revenues, which are payments made in lieu of taxes by Citizens Energy on  the utility property it will get under the deal, to issue bonds to fund at least another $190 million in street and sidewalk improvements. No other taxing unit in Marion County will share in those revenues despite the fact that the payments represent payments on otherwise tax-exempt real estate. While the city will reap 100% of those tax revenues, its share represents only 20% of the property taxes businesses and residents pay each year.

Mayor Ballard is holding a press conference at 10:30 a.m. to gloat about this latest pay-to-play deal. What do you want to bet not a single member of the local news media will question the ties that so obviously played into the selection of ACS for this lucrative 50-year lease?

UPDATE: Apparently someone in the media took me up on my challenge at today's press conference and asked Ballard about awarding the long-term lease to ACS given its role in the botched FSSA privatization contract and its financial ties to people being paid to advise him. A WTHR report by Mary Milz shows Ballard looking and acting totally dumbfounded that any one would even question the choice. She then followed up with an interview with Marion Co. Democratic Chairman Ed Treacy, who wisely pounced all over the decision. Like I said, the people advising Mayor Ballard are simply trying to see how much money they can make off his stupidity and complicity in the raping of Indianapolis taxpayers for the benefit of his political contributors. They don't care how badly they damage him politically. As long as they are making millions off his administration, that's all that matters. This truly is the most corrupt administration in the history of Indianapolis. Taxpayers for generations will be paying the price for allowing him to auction off city assets to benefit his political cronies. This is where the U.S. Department of Justice should be focusing its public integrity investigation. Indianapolis public corruption long ago surpassed that of Chicago. The absence of an honest federal or state prosecutor in Indianapolis allows the politicians to operate with impunity.

16 comments:

Paul K. Ogden said...

Please tell me this is a late April Fool's joke.

Ben said...

and they promised Ballard a life time of free food at the Golden Corral

Downtown Indy said...

I can't wait for when the s**t hits the fan the next time there's a big event downtown on a weekend or week-night, and hundreds of people get surprised by a parking violation - or get towed.

I also await learning how many more meters may pop up in areas that currently don't have them!

Sean Shepard said...

FIFTY YEARS? FIFTY?!

What the hell are these people thinking. Obviously, without reading the details one can't know for certain but basically is this company paying $35 million to buy itself a monopoly on the parking meters?

On the surface this just seems wrong. I can only hope there are a lot of recourse provisions. The garages offer some limited level of competition; but, even those aren't really operating in a true free market environment.

And, how much influence over parking meters does the Council now lose? Curious.

FIFTY YEARS... FIFTY. Not Five. FIFTY. [still shaking my head in bewilderment]

dcrutch said...

The news about the Ballard administration gets worse every day. It reminds me more and more of reading about Mayor Daley Sr's administration in Chicago. The trains ran on time but everything was a closed deal- no outsiders admitted.

I wasn't of the philosophical mind to elect a machine politics guy. I thought I was electing a guy who had no political experience, a veteran who wanted to buck the system, put his economics degree to work and not be as much in-somebody's-pocket as Peterson.

I was wrong. Whether it's 33M for the Pacers, Brizzi keeping his job, blackmailing sidewalk repair thru increased water rates, zero input on an inner city school system that can't graduate half the kids, abandonment of investigating private stadium management, or handing over IT & parking meters contracts to cronies- this is worse than Peterson, Goldsmith, or any administration I can think of for ignoring corruption and rewarding "players".

I concede, I've only been here 23 years, undoubtably naive and remote from the fray compared to many. However, nobody ever provided services to the city based on merit or price, versus who they know and how much they donate?

Sean Shepard said...

Another quick thought. There seems to be a big rush to get a lot of these capital improvement projects started. Without comment on the need for much of it, I do wonder about whether the urgency to do these big deals is centered around improvements prior to the Superbowl (assuming no lock-out - LoL) and/or the 2011 election (which is an obvious one - but I wonder about if there is big concern about putting some lipstick and mascara on the city?)

Chris Vanasdalan said...

I for one will be riding my bike downtown a whole lot more often.

Marycatherine Barton said...

dcrutch said a mouthful, very well, and I so agree! Ballarditis is contaminating.

Southsider said...

I for one will not be going downtown as much.

Paul K. Ogden said...

dcrutch, Mayor Ballard has an economics degree? From where? Devry College?

My apologies to Devry College graduates everywhere.

Downtown Indy said...

I ride my bike downtown all the time. I do NOT, however, leave it unattended at any time. I doubt it would be there on my return - at least, not intact. I have seen any number of stripped frames, usually chained carefully to a solid object.

Advance Indiana said...

We've repeatedly had bicycles stolen out of our building's garage over the past year. I keep mine inside. It's obvious community policing isn't working in my neighborhood.

Downtown Indy said...

Back on the cycling theme, I was just thinking...

What if - when I was 5 years old and just learning to ride a little bike with training wheels - then mayor Phillip L. Bayt Jr. had signed up the city to a 50 year deal for, oh let's say interurban transit service.

Or if 100 years ago, mayor Samuel Lewis Shank had signed the city up to a 50 year deal to manage the clean up of horse manure on city streets.

Things change unimaginably in a half century.

dcrutch said...

From verifying on indy.gov: Mayor Ballard is a Cathedral grad, undergraduate Economics degree from I.U.

My buddy had his bike stolen from a garage rack a few bldgs down from Gary. There are public bike lockers downtown.

We may not always agree, but thank's to Ms. Barton for her kind words.

iPOPA said...

Sean,

Why are you so surprised, bruh? This is only half the lease on the Indiana Toll Road. Ballard was just taking his cue from Mitch Daniels.

Mike Kole said...

Right on the money, IPOPA. Er, so to speak. *cough*

My underlying thought is with regards to light rail. There are certain conditions that make it work, and Indy has had none of them: high density over a large geographic area, auto commutes of over an hour, a scarcity of parking and/or expensive parking. Well! This change 'addresses' this.

Call my cynical, but I believe the Ballard Admin had this in mind. There are forces that want to ram this light rail down no matter what lack of common sense or reading of balance sheets.