New York City is scrapping plans to privatize management of its street-parking system, the latest sign of growing wariness in U.S. cities of initiatives to address budget woes by selling off the rights to run meters and lots.
The decision by the nation's largest city comes amid a backlash in Chicago, whose 2008 deal to lease rights on 36,000 parking meters to private investors for 75 years for about $1.2 billion was the first parking privatization by a major U.S. city. Chicago residents and policy makers—including Mayor Rahm Emanuel, whose predecessor presided over the deal—have criticized it for selling the rights too cheaply and for including clauses that have ended up costing the city additional funds. Pittsburgh and Los Angeles also have put privatization plans on ice.
New York officials said last summer that hiring a private operator for meters for the city's 85,000 paid on-street parking spaces could speed innovation. City officials were careful to say any deal would be different from Chicago's, where control was handed over to the investors. Mayor Michael Bloomberg's administration insisted the city would retain control over key operational decisions, especially pricing and hours of operation.
But the city's Department of Transportation has decided instead to move ahead with meter-modernization efforts of its own later this year, a spokeswoman for the mayor said. "In order to proceed with this venture, a private operator would have to demonstrate that they could significantly improve on the city's financial and operational performance," a city official said. "It was just not clear enough to us that this was possible."What New York is doing is precisely what those of us who didn't stand to personally profit from a parking meter deal advocated that Indianapolis should do instead of giving away the asset and profits to a private company. That plan wouldn't have made tens of millions of dollars for Ballard's pay-to-play contractor friends so it was dismissed out of hand. ACS/Xerox and its attorneys are making a shit load of money, while throwing a few crumbs to Indianapolis taxpayers, a good sum of which Ballard turned around and gave away to his largest pay-to-play contributor, Ersal Ozdemir, to build his Broad Ripple garage.
The WSJ says the city of Los Angeles also recently nixed a plan to privatize city-owned parking garages due to concerns over "potential rate increases and other concerns." In addition to the criticism leveled at Chicago's corrupt privatization deal hatched by former Mayor Richard Daley, the WSJ mentions Indianapolis' privatization pushed by Goldsmith.
Indianapolis privatized its system in 2010. Aaron Renn, a prominent blogger on urban affairs, criticized the Indianapolis deal as a misuse of public assets, but he said it is "certainly more successful than Chicago," with smarter contract stipulations.Apparently Cincinnati's mayor has become as corrupted as Indianapolis' mayor. Officials there are moving forward with a privatization plan according to the WSJ in order to close a $34 million budget deficit. Cincinnati can't afford its two new sports palaces and fund basic city services so they're starting to sell off city assets like Indianapolis.