Saturday, July 11, 2009

Indianapolis May Privatize Parking Meters To Raise Revenues

Mayor Greg Ballard's administration is pondering a plan to enter into a long-term lease with a private firm to operate the City's parking meters as a quick way of raising significant revenues, perhaps as much as $100 million according to the IBJ's Cory Schouten. A similar privatization scheme for Chicago netted $1 billion for the over-taxed and bankrupt city to the north, but it left commuters fuming as parking meter fees skyrocketed. While Chicago used its windfall to fix a big hole in its budget, Ballard's administration wants to use the funds to make sewer and road improvements.

Several well-known firms, including Denison Parking, KPMG, Michigan-based Carl Walker parking, Maryland-based IMG and ACS, one of the company's currently managing the botched privatized welfare services for FSSA, have submitted proposals to the City in response to an RFP. One thing is certain, parking meter rates will go up substantially from the City's current 75-cent per hour rate. Some plans call for extending the time fees are charged from 6:00 p.m. to 10:00 p.m., a move that could hurt downtown businesses.

Any privatized meter plan will likely see the introduction of meters that allow payment by credit card or cell phone. At the same time, the City is likely going to raise parking rates for the approximately 10,000 off-street spaces it controls with the Capital Improvement Board. Denison Parking is currently under contract to enforce the City's parking meters. The City pays Denison about $330,000 a year according to Schouten. Parking meter revenues annually are about $2.2 million, while parking citations rake in $2.7 million. With $1.1 million in expenses, the City nets about $3.5 million.

I have a simple solution for boosting parking meter revenues. Anyone who spends any time downtown has noticed the common practice of city workers coming around bagging parking meters for special events and planned construction work well in advance of the event or planned work. This practice infuriates business owners, particularly along Massachusetts Avenue, who sometimes take it upon themselves to post signs on the bagged meters advising people to park there for free because the event won't take place until the next day.

As for the City potentially looking for a short-term windfall for a long-term deal, I think the Ballard administration is playing with fire. When the City says it wants to use this money for road and sewer projects, that tells me the deal will also involve long-term borrowing through bonds. Inevitably, the City winds up spending a far greater sum than it derived from the initial lease of the asset. I hope the Ballard administration takes a hard look at these proposals and acts according to the best interests of the taxpaying-public and not the lawyers, consultants and campaign contributors pushing this idea.


Downtown Indy said...

Let's see, we privatized the water company and rates have gone through the roof.

We privatized the Toll Road and rates doubled.

Yeah, this meter thing sounds like a great idea.

Paul K. Ogden said...


The meters were bagged a day and a half early for the 4th of July Fireworks to take place on Saturday of that week (until it got rained out.) As I noted in my blog, about 500 meters were bagged on the previous Thursday. Some said "No Parking Today." Some said "No Parking Saturday."

On Friday, July 3rd, I saw Denison people writing tickets for one car after another that parked at the bagged meters and had not fed the meters. It's obvious the people were confused about feeding the meter when the event was the next day but the meter had a sign draped over it. So I don't know about the business owners on Mass Ave advising them not to feed the meter when they're bagged way in advance of the event.

On Delaware Street, just across from the City Market where my law office is located, we had meters bagged for two weeks earlier this year. There was no work going on. No one had any idea why they had bagged the meters. Since the placard fiasco where the Star outed many city/county workers, this has been going on. The blocks that are bagged move around periodically. My suspicions are that they're using them to make up for some of the lost placard spots.

As far as the long term contract for the meters, I have preached about this until I'm blue in the face. Handing a vendor a long term contract to provide a service is not privatization. It is monopolization. Monopolization does not protect the people who work, live and visit downtown.

artfuggins said...

What about places of business that are able to bag meters for valet parking? Do they pay the city a fee for that....i.e. Murat Shrine, Ruth Chris' Steak House ....and many others

Gary R. Welsh said...

Or who decides that all of those parking spaces along Illinois Street become the property of those select restaurants and their patrons who drive Mercedes, Bentleys, etc.?

Downtown Indy said...

Parking meter fee waiver from 2005

Parking meter fee waiver from 2009

There appears to be a flat $15/day fee for each bagged meter. However the Board of Public Works appears to waive this fee quite liberally. $9725 was forgiven for blocking the spaces around the weekly Farmers' Market.

I included the first link from 2005 because it referenced the Arts Council. Another one of their perks - free parking when they want it.

Chris Worden said...

Can somebody explain the economics behind this? How can you say you want to lure people downtown while raising the cost of actually doing so? Do they think they they can quarter and dollar patrons, and the events they attend will be so appealing, they'll just eat it?

Gary R. Welsh said...

Those parking fees won't be paid by the out-of-town conventioners who enjoy the downtown amenities. They will be paid by local workers and residents. They should be concerned. Parking is one of the reasons many businesses have relocated offices outside the downtown area.

Eclecticvibe said...

How about ticketing the cars that park three dip in from of the Columbia Club? That should be a steady revenue source. Several of them seem to have state government plates on them. Guess that means you can park in the middle of the street.

artfuggins said...

I have a friend who needs and uses a handicapped parking place. She can never find a vacant handicapped space around the city county building as they are always filled with police cars.

Nick said...

Inspector General Rips Parking Meter Deal In Report:

City Could Have Gotten Nearly $1 Billion More