The Windy City edition of the New York Times debuted today, featuring an article on the controversial parking meter lease from veteran City Hall reporter Dan Mihalopoulos, now with the Chicago News Cooperative. In his report, Mihalopoulos digs into the books of Chicago ...
The Windy City edition of the New York Times debuted today, featuring an article on the controversial parking meter lease from veteran City Hall reporter Dan Mihalopoulos, now with the Chicago News Cooperative.
In his report, Mihalopoulos digs into the books of Chicago Parking Meters LLC, the private company that now controls the city's meters under a 75-year, $1.15 billion deal with the city. He found -- not surprisingly -- that the company's profits are growing steadily, generating $1.1 million per week, thanks to the higher rates they instituted after taking over the system. With more gradual increases on the way, the company is projected to collect $46.9 million this year and $79.5 million in 2010.
The most candid remark in Mihalopoulos' piece came from Ald. Rey Colon (35th Ward), who was one of five aldermen to vote against the 2008 ordinance approving the parking meter deal:
Another of the naysayers on the Council, Rey Colon, said this week that the parking meter company’s own numbers showed that aldermen should have raised parking charges and kept the money that the increases would have generated.
“At this rate, it was a great deal for the parking meter company,” he said. “I don’t know if it was a good deal for the city. We should have just bit the bullet and done it ourselves.”
Mayor Daley and some of the aldermen who supported the deal like to make the argument that the city could not have "bit the bullet and done it ourselves" for political reasons. They further argue that their chosen path -- offloading the responsibility for the system to a private company (who then raises the rates) in return for an immediate windfall -- was a safer approach. But was it? As then-Inspector General David Hoffman noted in his report on the deal, it's not like the mayor and the city council dodged the bullet; indeed, they've have still taken a great deal of flack for the rising parking costs (not to mention the botched implementation). Furthermore, other cities have managed to hike rates and generate revenue for their operating budgets without experiencing some apocalyptic voter backlash. Some of them, such as San Francisco, are even using their meter system to experiment with innovative congestion controls. It'll be 75 years before we have a chance to do the same.
To add insult to injury, the proceeds of the deal are almost gone thanks to the city's gaping budget deficit, so taxpayers will soon have little to show for the lease. CPM, however, will make out just fine.
The question now is whether the City Council will learn from its mistake. So far, a mere 12 of the council's 50 members have signed on to Ald. Scott Waguespack's (32nd Ward) Asset Lease Taxpayer Protection Ordinance, which would require an “independent third-party valuation” on any future asset sales, including “a comparison of public retention and private leasing over the life cycle of the agreement." As Waguespack himself said recently, it's time to acknowledge that "the old way of doing things no longer works."