Wednesday, March 19, 2014

WTHR's Mary Milz Credits Parking Meter Revenue Increase To Privatization

Whenever the Ballard administration, Indianapolis Downtown, Inc. or VisitIndy wants to communicate propaganda about one of their rackets, they can always rely on WTHR's Mary Milz to help communicate their message. Milz' latest press release for the Ballard administration is all about the big revenue windfall the city is receiving from ACS/Xerox under the terms of its 50-year lease of the city's parking meter assets. Milz sees $3 million in higher revenues, while I see the $6 million going into the private operator's pocket that could be going into city coffers.
New figures from the city show Indianapolis is cashing in on parking.
Three years after it began a 50-year lease with ACS, a Xerox Company, to modernize and manage metered parking, revenues are up substantially.
Figures from the city show it went from netting $339,165 in 2010, when the city ran parking, to $3,066,546 in 2013 under ParkIndy. That's an 800% increase.
Mark Murphy, who was at a pay box along Mass. Avenue Wednesday, said, "I have no complaints. I still think the price is reasonable and I think in the private sector things tend to go better." . . .  
While the new parking system hasn't always been popular with drivers, David Andrichick, who owns the Chatter Box and co-chairs the Mass. Avenue Merchants Association is pleased with it. He said the longer hours and higher parking rates have increased turnover.
He said before there were "many abuses of the parking spaces by workers who would park here (through the day) and keep running back to feed the meter or (those who lived in apartments) parking here because it was more convenient than in the spaces they leased."
Andrichick said concertgoers are also more likely now to park in private lots.
"Absolutely there's more turnover and it's really changed people's behavior," he said. "And it's good for business owners."
Milz is apparently only familiar with one business owner on Mass Avenue, the Chatter Box's David Andrichick, who formerly worked for the Department of Metropolitan Development. He's one of the few business owners who was supportive of privatizing the parking meters. His building is chocked with code violations the City's code enforcement folks don't ever seem to get around to doing anything about despite the public eyesore it creates and numerous complaints lodged about the unsafe and unsanitary conditions of the building.

Operating parking meters is one of the easiest tasks the City had to perform. The Ballard administration deliberately ran revenues from the parking meters into the ground to make the case for privatization by not adjusting rates and continuing to use decades' old mechanical meters, which frequently malfunctioned and allowed motorists to park for free. The City netted only $339,000 on $3.5 million in revenues in 2010 before privatization. Last year, it netted just over $3 million on a little more than $9 million in revenues. What I don't see in the revenue numbers the City provided Milz is how much money the City paid to the private operator for the temporary closure of metered spaces for street and sidewalk repairs or for special events.

When the City turned over control of the parking meters to the private operator, the parking rates doubled, metered parking hours were expanded to include evenings and weekends and more meters were added, along with the introduction of electronic parking meters. So when you double rates, expand the hours of coverage, incentivize the operator to increase enforcement and install electronic meters that, to a fault, never short the meter box but often overcharge the patron, guess what happens? Yeah, your revenues skyrocket. Stepped up enforcement through the issuance of $20 tickets alone pushed up revenues about $1 million. There's nothing magical about the electronic meters used by ParkIndy. They're identical to electronic meters used by many other cities which found a way of using them without privatizing the asset. Yet somehow our City-County Council was too stupid to figure that out and bought the Ballard administration's argument hook, line and sinker. 

Meter revenue$2,149,949$2,882,847$5,325,041$6,079,420
Meter enforcement$1,276,213$1,684,189$2,130,663$2,019,409
Permit/Temp closure$101,865$497,280$289,452$674,938
Net revenue to city$339,165$1,519,295$2,530,391$3,066,546

UPDATE: Pat Andrews actually cross-referenced the net revenue numbers cited by Milz in her story, which were furnished to her by the City. The administration grossly misrepresented the net profit the City realized from parking meters assets prior to privatization. Using the numbers in the city's past approved budgets, she finds that the City realized profits of $2.65 million, $2.5 million and $2.6 million, respectively, during  the 2009-11 fiscal years. Obviously, the Ballard administration deliberately fudged the numbers to make the privatization deal appear better than it actually is.


Anonymous said...

One overlooked issue that led to the revenue increase was the technology increase. Now the parking enforcement staff gets an immediate message when your meter expires and your car is still there. Thus, by knowing there is an immediate violation, they respond with the ticket.

The old system required the parking enforcement staff to walk a route to find where the violators were.

The technology could have been purchased by the city and run by the city.....but something makes me think that pay-to-play may have entered the picture.

Imagine the revenue increase if the city bought the technology and eliminated the middle-man!

Gary R. Welsh said...

That's exactly what I argued the city should do at the time. That's precisely what many other cities chose to do rather than lease the entire asset. That isn't to say there couldn't have been a role for a private vendor to install and maintain the equipment. P3 is sold to the public often as a cost-saving move when it often produces no net savings.

Flogger said...

The other issue I see is the 50 year lease. What business enters into a 50 year lease?? I worked for a large Multi-National Corporation. We seemed to change vendors every few years from office supplies to coffee machines.

Pete Boggs said...

The transaction interface or design is not state of the art. It's clumsy; could be much better, more intuitive.

Shouldn't dollars collected for parking only be used for road maintenance or is that already the case? Other uses would seem to treat citizens like revenue cows rather than taxpayers.

Anonymous said...

Parking meters make me shop in Carmel, Castleton, Fishers and Keystone.

Anonymous said...

Wasn't the City supposed to receive over 3 million each year according to the agreement? If that's correct it looks like it took the program 4 years to get there.

Anonymous said...

It's big brother contracting with pay to players...Don't trust it and don't use them...