Holy Toledo, $45,000 for a parking ticket?!?

It all started with a $20 parking ticket given to Toledo lawyer Jeffrey Zilba while he was parked in front of the Ottawa County courthouse in Port Clinton, OH in the summer of 2011. Since the legality of his parking was ambiguous (and being a professional arguer for a living), Mr. Zilba wanted to challenge the ticket, as many of us have unfortunately been forced to do at one point or another. That was when he realized that the ticket had no phone number and no way of challenging it given on the ticket. Failure to pay the $20 ticket would result in a misdemeanor, meaning that the only option for someone receiving one was to either pay the fine and admit guilt or become guilty of a crime. Not only was this unacceptable to Mr. Zilbas, but he saw it as a violation of his right to due process as guaranteed under both the U.S. and Ohio constitutions. So Mr. Zilbas paid the ticket to avoid the misdemeanor and decided to start a suit against the city.

And that’s when things started to spin out of control. The suit dragged on for more than a year and a half, finally ending with a ruling in favor of Mr. Zilbas. The city was ordered to decriminalize their parking tickets and provide a way to challenge them, as well as paying damages to Mr. Zilbas. Those damages? $45,000 worth of lawyers fees! The money to pay the settlement was approved by the Port Clinton city council, which has also started the process of changing their ticketing ordnances. The money to pay for this case will unfortunately come from the city’s general fund, which will cause the delay or abandonment of some of the projects slated for the city this year.

So where does the blame lie? Well, despite what seems like some pretty high lawyer fees and what must be heaping helpings of determination or stubbornness, Mr. Zilbas is not the one at fault; his rights were infringed on, and he had a legitimate case. The blame and responsibility really lies with the city. They enacted the unconstitutional ticket policy in the first place, and also failed to resolve this case out of court when it would have been much cheaper for taxpayers and saved a lot of time as well. When it gets down to it, it was, as always, the combination of a lack of oversight and attention to the city’s parking program and not wanting to give up some of the cash cow that is parking fees, even if those fees are being levied unfairly and without a way to challenge them. It’s a small tyranny, but it’s still a tyranny when meter maids are made into judge and jury for Port Clinton citizens.

Bad parking deals continue to saddle Chicagoans with more Daley-debt

In what is sadly becoming routine for Chicagoans, the Windy City was hit with yet another $60+ million parking bill at the end of February. As some may recall, a few weeks ago I talked about the mounting parking issues in Chicago including a recent dispute with Chicago Parking Meters LLC over an alleged overbilling of $22 million to the city. Well, on February 25 the city was told to pay $57.8 million to Chicago Loop Parking LLC as part of an arbitration agreement due to a breach of the city’s contract with the LLC committed under the Richard M. Daley administration.

As bad as that sounds, the silver lining is that the $57.8 million that was decided upon in arbitration is a far cry less than the $200 million that Chicago Loop Parking LLC originally demanded. The issue goes back to the deal that Mayor Daley signed with Chicago Loop Parking in 2006 giving them a 99 year lease on all parking garages at Millennium Park, Grant Park North, Grant Park South, and East Monroe Street for $563 million. As part of the deal, the city agreed to not allow new public parking garages to be opened in a designated area surrounding the CLP properties. Yet within months of inking the deal, the Daley administration approved the Aqua tower, which included a 1,288 space parking garage, in the off-limits area and subsequently granted a license to operate the parking garage to Standard Parking.

Not surprisingly, Chicago Loop Parking initiated private arbitration (as outlined in their contract with the city) which took place last October. Originally, the LLC had demanded $200 million, breaking it down as a combination of lost revenue, increased operating expenses caused by the Aqua facility and interest. Arbitration brought that amount down to $57.8 million ($50 million for lost revenue plus $7.8 million in interest), but was also supposed to be “final and binding”. Despite that, the city is trying to appeal the decision.

While already reducing the tab by almost 75%, the settlement is still a big hit to the city budget. The city is already in a dispute with Chicago Parking Meters LLC over a $25 million bill, and recently lost a job discrimination lawsuit dating back to 1995 that cost them nearly $80 million. And how much did the city have budgeted for settling lawsuits this year? $27.3 million, barely 15% of the City of Chicago’s legal tab so far this year. Hopefully for Chicagoans, the Daley administration hasn’t left any more fiscal time bombs to further cripple the city’s budget.

Charlotte Airport Parking Fees Could Rise After State Takeover

Airport Parking Fees Could Rise After State Takeover

by ISRAEL BALDERAS Bio    | Email   | Follow: @israel_balderas       by PHOTOJOURNALIST TIM MULLICAN

Story Created:            Mar 18, 2013 at 11:04 PM EDT

Story Updated:        Mar 19, 2013 at 12:33 AM EDT

CHARLOTTE, N.C. – Parking rates at Charlotte-Douglas International Airport are quite lower than other similar size airports. Those fees, in turn, help to partly fund operations.

But under a profit-sharing arrangement with U.S. Air, millions of dollars also flow to the airport’s largest tenant.

To get higher revenues, fees could go up. But for that to happen, city council oversight would also have to be removed.

“Charlotte used to be great to fly out of,” said Mooresville resident Chuck Fogle. “With this, it’s really made business travel difficult.”

Fogle says construction plans for a new hourly parking deck are lacking. Most travelers have to use the long term area, which can be a hassle on a rainy day.

“You have to walk a long distance from your car to the bus stop,” said Fogle.

For those returning back to their cars after a flight, there’s confusion about which bus to take.

“This is the fourth bus already, and its not ours yet,” said Greenville, S.C. resident Dave Overbaugh. “We’ve never seen a daily north before.”

But the parking headaches are worth it, as long as it’s cheap to park and fly, and fares don’t go up.

“I hope not,” said Overbaugh with a laugh. “It’s a whole lot cheaper to fly out.”

Currently, U.S. Air receives almost $10.5 million from the airport budget in “non airline terminal revenue.” That is money travelers spend, such as buying coffee or parking their cars.

A spokesperson for U.S. Air says they supported raising parking rates, along with other airlines. But, U.S. Air adds, “we did not initiate, drive or influence the actual rates.”

Keep in mind, the airline accounts for 90% of the airport’s 700 daily flights.

Right now, Charlotte City Council is fighting the Republican controlled General Assembly over a proposed takeover of the city’s airport.

By turning it over to a regional authority, Charlotte would have its management oversight taken away by state legislators.

“There’s clearly an issue of political accountability,” said Mayor Anthony Foxx.

Any increase in concession costs and parking fees ultimately has to go through the city. But with a regional authority, citizens would have no one to address their concerns.

FOX Charlotte sources say airport manager Jerry Orr has researched parking rates in other markets. To raise them, Orr would have to appear before city council and make such request.

If that were to happen, council members would be the first ones getting the phone calls.

State legislators who propose a regional authority say the move would take away any politics from airport decisions.

“Today citizens can call and complain about various things that have to do with the airport,” said Foxx, “and we have to manage that.”

Republican State Senator Bob Rucho wrote the legislation that turns Charlotte-Douglas from a city managed airport to a regional authority.

Section 5 of the bill states future board members will receive free parking.

Parking woes in the Windy City

Chicago is fast becoming the worst parking situation in the country. If you’ve ever had to drive anywhere in Chicago, you know it’s a nightmare of traffic congestion, constant construction and angry drivers hanging out their windows and shouting profanities at each other; now it seems the parking there is becoming just as bad. An array of factors have occurred over the past few years to make this happen, and like everything in Chicago there’s more than enough corruption and  underhandedness to go around.

Since we’re talking about corruption, there’s no better place to start than Mayor Daley’s office. Back in 2008, Mayor Richard Daley put pressure on the Chicago city council to privatize the parking authority in Chicago. The deal was forced through and voted into action in just two days, and it became rapidly apparent that between all the backroom deals and arm twisting that it took to pass it, nobody had a chance to read over the deal. It was a sweetheart deal for the company, Chicago Parking Meters LLC., giving them a 75 year lease of all the city’s parking meters and entitling them to all the profits during that time in exchange for $1.15 billion paid to the city upfront for the lease. It wasn’t too much later that the city’s inspector general reported that the city had undervalued the contract by at least $1 billion, and that wasn’t even taking into account the steep rate hikes that CPM has implemented since taking over. In addition, the contract stipulated that the city compensate CPM each year for all potential meter profits lost from construction, street repairs, festivals, and handicap placards. What that means is that anytime any parking meter wasn’t in service or someone got to park for free, the city was getting billed for every hour of it.

On top of that, CPM has raised parking rates in Chicago every year since their contract started. Chicago now holds the distinction of possessing the highest parking rates in the country thanks to all the hikes. What that means is that in addition to how much they’ve been taking out of the pockets of Chicagoans, they’ve also been billing the city more and more for “missed parking” thanks to the rate increases. After already making hundreds of millions off of the city with this deal, Mayor Rahm Emanuel had an auditing system created to verify CPM’s lost parking hours claims. Lo and behold, the audit revealed that CPM had over-charged the city by $22 million for 2012, saying the city owed $25 million for lost parking instead of the $3 million indicated by the audit. The city is still fighting with CPM over the money, and Mayor Emanuel has frequently referred to the parking deal with CPM as the worst in the city’s history.

As if trying to add insult to injury, there have been more and more stories surfacing of Chicagoans being ticketed while paying for their parking, either while they were walking to a pay station or while they were struggling with a defective meter. In most cases, no amount of attempts to contest the tickets has gotten them reversed, despite assurances from  CPM and the city that parking enforcers are instructed to check to see if the vehicle owner is on their way to or paying the meter. On the opposite end of parking enforcement cruelty, their seems to be a rogue officer at Northwestern Memorial Hospital who is fining legitimately disabled visitors and confiscating their drivers license and disabled parking placard, forcing these poor folks to suffer for weeks until they can get the violation overturned in court and their licenses and placards returned to them. So far, 17 out of 19 handicap parking violations this officer has handed out have been overturned by the courts, and yet this person is apparently still on the job.

There is one small ray of sunshine in all of this; despite being scheduled to go into effect January 1st, the latest $.75 rate hike has yet to happen. No clear explanation has been given by LAZ Parking (the parking management company hired by CPM to run their meter operation), though they have stated that the price hike will be in effect before March 1st. So enjoy the “luxury” of only paying $5.75 an hour for parking while you can Chicagoans, and let’s all hope Mayor Emanuel can get some concessions from CPM or renegotiate their contract sometime in the near future.

SFpark hourly meters actually saves motorists money | Will Reisman | Transportation | San Francisco Examiner

SFpark hourly meters actually saves motorists money

By: Will Reisman | 12/16/12 8:56 PM

SF Examiner Staff Writer

“The meter rates aren’t changing as much, which is proof that we’re zeroing in on the rates that aren’t too high or aren’t too low.” — Jay Primus, project manager at SFpark

When The City first installed its SFpark meters — devices that would increase hourly parking rates based on demand — many motorists complained that it was one more way to gouge drivers for extra dollars.

In fact, the program has done the exact opposite.

Since taking effect in April 2011, average hourly rates have dropped by 14 cents from $2.73 to $2.59 at the 7,000 SFpark meters. Overall, 17 percent of those meters offer hourly rates of $1 or less — prices that are significantly cheaper than the ones offered at The City’s 22,000 older meters. And 6 percent of SFpark meters go for as cheap as 25 cents an hour, according to data from the San Francisco Municipal Transportation Agency, which oversees parking policies in The City. The drop in prices for on-street parking meters coincides with a 20 percent rate decrease in SFMTA-run garages.

Donald Shoup, a UCLA professor whose theories on parking were instrumental in developing the SFpark program, said he expected prices at meters to rise in the first year, given the demand for spaces in San Francisco. He said the drop in meter rates is proof that the agency is concerned about responsible parking management and not price-gouging policies.

“I don’t understand how anyone can keep parroting that this is a money grab,” Shoup said.

Because the SFpark meters provide more payment options for motorists, ticket citations have decreased.

Previously, the SFMTA received about 45 percent of its parking revenue from citations. At the SFpark meters, that rate is 20 percent, agency spokesman Paul Rose said.

Rates at the SFpark meters are adjusted every six weeks to reflect demand for specific spaces, with prices as high as $5.75 an hour. Jay Primus, project manager at SFpark, noted that only half the meters were changed during the last adjustment, meaning that prices are nearing an hourly rate that will consistently manage demand.

“The meter rates aren’t changing as much, which is proof that we’re zeroing in on the rates that aren’t too high or aren’t too low,” Primus said.

Instead of drawing in reams of revenue for the SFMTA, the SFpark program has actually contributed to a slight loss. The agency expects to receive about $5.5 million less than expected from parking citations this fiscal year, although those losses are offset mostly by an increase of $4.4 million from additional meter revenue. The agency has a total budget of $830 million.

“The obligation of this program from the onset was to achieve the lowest parking prices possible to achieve our goals,” Primus said. “I think we’re proving that.”

That argument might be lost on some city residents. Several neighborhood groups have formed organizations to oppose the new meters. Mari Eliza, a spokeswoman for Eastern Neighborhoods United Front, said the new meters are confusing and they are slowly creeping into residential areas.

“The arguments the SFMTA uses about managing parking don’t really hold water with residents here,” Eliza said. “Personally, I’m perfectly happy with the old meters. That’s how I use up all my spare change.”

wreisman@sfexaminer.com

via SFpark hourly meters actually saves motorists money | Will Reisman | Transportation | San Francisco Examiner.

Tragedy and Tears

“Tragedy is a tool for the living to gain wisdom,not a guide by which to live” – RFK

Originally, I had a new piece ready for today about a corrupt parking operator in Port Canaveral. But then last Friday happened, and writing about some petty criminal just seemed inappropriate. To be honest, nothing feels “right” ever since Friday morning. So I’ll regale you all with stories of parking next week on Friday, but today I need to talk about what’s been going through my head ever since Friday morning.

There are many people in my life, both work and professional, that are proud, responsible gun owners, who use them for sport and pleasure. But the same could be said about cars, and yet no one sees that as a justification to stop requiring testing and licensing to drive a car. No one would argue that this basic system of regulation makes our roads and all of us safer. Does that eliminate all vehicle deaths? Of course not. But it does save a lot of lives. That is why I cannot for the life of me understand why we don’t do the same with firearms, why some say it’s not even appropriate to talk about that in the wake of a tragedy that could not have happened if firearms had not been readily available. On the same day that Adam Lanza murdered so many, a man in China tried to do the same, except because he could only gain access to a knife instead of a gun, no one died.

Preventing future incidents like this is not a simple matter. Gun control is not the sole solution to this problem (and it is an endemic problem here in the US, 15 of the 25 worst gun massacres in the world in the past 30 years were in the U.S., with Finland taking the number two spot at only 2 incidents), but it is one of them. Our failing schools and our outdated, underfunded mental healthcare system also share the blame and need to be examined and changed. But of all the factors involved, there is only one that empowers people to kill in an instant with just a twitch of the finger, only one that lets you turn life into an FPS video game. And in fact, in some states a 16 year old can’t buy an M rated video game, can’t see a rated R movie, can’t drink, can’t join the army, can’t vote . . . but CAN buy a concealed firearm with no permit; how is that a sane way of doing things in any way, shape or form?

I want to see all paths explored to prevent another Sandy Hook from happening in my lifetime. I’ve seen more of these massacres happen in the span of my life than my parents and grandparents saw combined in the time preceding it. I want to see reforms to our healthcare system so that people like Adam Lanza or Jared Loughner don’t fall through the cracks; I want to see our educators empowered to identify and help children with special issues long before their raging psychological problems have pushed them over the edge into becoming a monster; and I want to see a day when  it’s at least as hard to get a gun as it is to get a driver’s license or see an R-rated movie or join the army. How is any of that unreasonable? How is any of that challenging people’s rights? And yet, I cannot help but notice that many of the same voices that are saying we should be having a conversation about mental health instead of gun regulation are the same voices that argued against having a healthcare system that leaves less people falling through the cracks and a public education system that is robust and strong and nimble enough to meet the needs of our more troubled children. Something has to give, and despite my strong support of responsible gun ownership I cannot see any perspective from which making this country safer for our children and families isn’t worth having to go through a little more hassle to get a gun, or paying a little more in taxes so that there are less troubled, dangerous people spiraling down paths of self-destruction unaccounted for.

I know that this opinion will make me unpopular in some circles, but I’d rather risk being unpopular than risk someone else’s life. I rail against big government all the time in this blog, but this is one of those complicated issues that give purpose to government. This is why we form societies, why we have laws, so that we can ensure the peace and safety of as many people as possible. There is a role for government and for regulation, and this is one of them. Over the course of my life I have seen government checks on gun ownership weaken more and more, and subsequently have seen more and more acts of mass acts of violence and murder in that same time; why in God’s name would anyone be opposed to at least trying the reverse of that equation, one that has worked so well in virtually every other developed nation in the world, and seeing if stronger checks on gun ownership can reduce the number of tragedies we all see in our lifetimes?

My heart goes out to the community of Sandy Hook. I cannot fathom the depth of their pain and loss, and although it’s a bit selfish I hope I never do; in fact, I hope no one else ever does and that no one ever again has to experience this kind of tragedy. And I hope that as a nation, we can come together like we did after 9/11 and honor those lost by saying “Never again!” With that in mind, below is the list of lives lost last Friday. If I never see a list like this again in my lifetime it will be too soon. Those of you who pray, I ask that you pray for all of them and their families; those of you who don’t, I ask that you read their names and honor them both in memory and in deed. Never forget, never again.

Charlotte Bacon, 6

Daniel Barden, 7

Rachel Davino, 29

Olivia Engel, 6

Josephine Gay, 7

Ana M Marquez-Greene, 6

Dylan Hockley, 6

Dawn Hochsprung, 47

Madeline F. Hsu, 6

Catherine V. Hubbard, 6

Chase Kowalski, 7

Jesse Lewis, 6

James Mattioli, 6

Grace McDonnell, 7

Anne Marie Murphy, 52

Emilie Parker, 6

Jack Pinto, 6

Noah Pozner, 6

Caroline Previdi, 6

Jessica Rekos, 6

Avielle Richman, 6

Lauren Rousseau, 30

Mary Sherlach, 56

Victoria Soto, 27

Benjamin Wheeler, 6

Allison N Wyatt, 6

Big government thinks parking hikes will shrink your waistline

Officials in Britain’s National Institute of Health and Clinical Excellence (NICE) as well as local governments and businesses are considering raising parking rates in an attempt to force people to walk more and get more exercise. The goal is to curb the rising obesity rates in Britain’s population which have increased nearly fourfold over the past 30 years to 24% as of 2009. Still, the UK pales in comparison to the US which still holds the number one spot for fattest asses on the planet with a whopping 36% obesity rate. NHS research has shown that Britons are walking less and less, which is one of many contributing factors to the rising UK obesity rate (McDonald’s is undoubtedly taking a top spot on that list of causes though).

So how do you get people walking more? Apparently, NICE decided to go with “Make them!” as an answer. The idea is that by raising parking rates they will effectively price people out of driving unless absolutely necessary. On paper, this could almost make sense. After all, many cities are adopting demand-based electronic parking meters that change prices based on availability, raising rates as available parking fills up so that there’s almost always open parking in a given area. The success of using a free-market system like this for parking to meet both consumer and municipal goals (convenient parking and positive revenue flow respectively) has been well researched and documented; in fact, nearby San Francisco has implementing this system with great success as part of a case study run by Professor David Shoup (and as all you Shoupistas know he is THE authority on parking systems and economics). And there’s no denying that folks aren’t getting enough physical activity these days. But once you look beyond the surface, the gaping holes in this idea become clear.

The first logical fallacy in this plan is the idea that many people are CHOOSING to drive rather than NEEDING to drive. It’s the same type of thing that happens when celebrities talk about how everyone can take a little time out of there day for yoga or a workout or a colon cleansing or whatever, they have no concept of how much easier having an army of servants and personal assistants and personal trainers and nannies make the minutia of life, and how much harder it is to find not just the time but the mental energy and motivation to put some time into yourself during the day. It’s the same thing for many people that are driving, particularly those who are working class. It’s been proven that the poorer you are, the farther away you’ll be from fresh sources of food such as a grocery store; for example, there are no actual grocery stores within the city limits of Detroit! So there really is no other option for many working class folks than to drive to get their groceries. Same goes for a lot of other everyday things; a significant amount of people have to pay their bills in cash for instance, or don’t have buses that can take their kids home, or are working two jobs and simply don’t have the time to walk somewhere. For these folks, who don’t have the luxury to forgo driving as part of their day to day routine, this parking hike is going to place an undue burden on them, essentially just making it more expensive for the less affluent to go through their day.

This will also hurt businesses anywhere a policy like this is in place. When a parking market system is used to raise or lower parking rates so that there is always available parking in a commercial area, this benefits everyone. Businesses make more money because their customers can always find parking to reach them, and customers are only looking at paying a little more for convenient parking if it’s a busy day. By contrast, the NICE plan of essentially pricing people out of parking so that they have to walk will leave numerous empty spaces in front of businesses that won’t get filled, thereby driving away customers that might have shopped there. Which ironically will lead to people shopping at home online more, and only increase their lack of physical activity. And of course on top of all of that, the truly obese will hardly be affected by this at all because they’ll still have access to convenient handicap parking and rascal’s waiting for them at the entrance of the grocery store.

So at the end of the day, all this policy would do is make life harder and more expensive for the working class while having virtually no effect on the wealthy or those who are desperately in need of more exercise. And let’s not forget that all these parking rate revenues go into government coffers, making this yet another way that big government is trying to pay it’s bills by taking money out of the back pocket of the working class. But hey, what are they supposed to do, actually provide basic nutritional education to children in school and revamp the school lunch program to have healthier, balanced meals?

Now, those of you reading this who are stateside like myself may be thinking “Why should I care about the British nanny state?” Well let me tell you why. As you may or may not know, New York city mayor Michael Bloomberg passed a ban on sodas larger than 16 oz a little while ago, in the interest of combating obesity. Some have been calling for Mayor Bloomberg to implement a similar parking program in the projects of New York, both by raising rates and literally eliminating some parking spaces in the projects and reducing the number of NYCHA issued parking permits. So we could be seeing these same misguided, nanny-state policies coming to the U.S. because apparently government, not willpower and motivation, is the solution to too many people being fat and lazy. Don’t get me wrong, I definitely think that Americans are way too fat and need to exercise more, but that will take a concerted, across the board effort that addresses the many root causes of the obesity epidemic in this country, not by trying to price our waistlines into shrinking at the meter.

Montclair NJ the next Scranton?

At least when it comes to their parking authorities. I already detailed the fiasco of the city of Scranton and how their mismanaged and allegedly corrupt parking authority dragged the entire city into near bankruptcy, but unfortunately Scranton is not the only city to suffer from a bad parking authority. Yesterday, the city council of Montclair, NJ voted to disband their parking authority and turn over control of the city’s parking to the city council (who will in all likelihood contract out the control to a parking management company) after a scathing report commissioned by the city council. On top of that, in mid-October the State of New Jersey announced they were doing an investigation into the MPA and its finances going back to 2007. So just what was going on to prompt all of this?

Well, there’s a laundry list of reasons. Despite accusations of the council’s report being a “hatchet job”, the numbers don’t lie. The parking authority had virtually no budgetary controls or oversight; they held cash for the authority in an unsecured office, which led to more than $1300 of it going missing; until just a few months ago, the MPA commissioners were completely unaware that not one but two different parking decks were THREE YEARS behind on their utilities bills, which now amount to $100,000 each; they have no purchase order or expense system, no financial controls, and no materials requisition system; a full 10% of the city’s meters were consistently broken; and multiple outside audits found that the MPA was violating state law by not having a purchaser/voucher system in place due to “management being unaware of the requirement”, an excuse which I believe only works after the FIRST audit pointing that out, not the second.

You can call that a hatchet job if you like, but in my experience pointing to your head and saying “It’s all in here” is not the most effective or reliable way to run a business, let alone a multi-million dollar parking authority. And despite claiming that the reports are untrue, the Chairman, Vice Chairman and Treasurer of the parking commission all resigned in short order just ahead of the state finance board approving the dissolution of the MPA; hard not to think that the rats are fleeing the sinking ship. Unlike Scranton, it doesn’t appear that it was corruption and cronyism that brought down the MPA so much as just laziness and a laissez faire management approach by the commissioners. Considering that part of what triggered the state’s investigation into the MPA was their travel expenses, you get the distinct impression that at least some of the commissioners were just enjoying the free ride on the city’s tab for as long as it lasted.

As the state’s investigation continues and the city goes through the process of dismantling and cataloguing the MPA, I’m sure more details will emerge  so that we get a more complete picture of what went wrong and who is ultimately accountable, but even without that future insight it’s clear that the city council is making the right move. $200,000 in unpaid bills is nothing to sneeze at, but it’s a far cry from the millions that the the Scranton Parking Authority was saddled with. By taking these steps now, the city of Montclair is saving themselves from being added to the list of communities dragged down by their parking services. Hopefully, other cities will learn from these examples and not wait until something goes wrong or a debt collector shows up at a city doorstep thanks to their parking authority; you can’t operate without oversight, even if it is something as mundane as parking! Just like a private enterprise can’t operate without oversight and budget control, public sector “businesses” like parking authorities can’t either. And yet as I’ve shown, time after time they are allowed to run wild with an entire city on the hook for any mistakes they make.

Car Hit With Over $100,000 In Chicago Parking Tickets | theexpiredmeter.com

Car Hit With Over $100,000 In Chicago Parking Tickets | theexpiredmeter.com.

 

Holy crap! Amazing story by Mike Brockway, who is the expert on all things parking in the Chicago area. Check out his blog at http://theexpiredmeter.com/ for more interesting Windy City stories and to see why “local government” is synonymous with corruption there.

Scranton Scramble

A banner promoting Dunder-Mifflin, the fictional paper company on NBC’s “The Office” hangs outside city hall in Scranton, Pennsylvania. (Photo credit: Wikipedia)

Scranton, PA doesn’t have many claims to fame; if someone has heard of it it’s because they’re a comedy fan and know that this is the home of “The Office” and Vice President Joe Biden. Lately though, Scranton has been in the news thanks to the furor generated around the Scranton Parking Authority and how it’s mismanagement set off a chain reaction that has bankrupt the city and destroyed it’s credit rating. It seems unbelievable that a mismanaged parking authority could put an entire city in economic jeopardy, but as you’ll see not only is it possible, it’s a situation that almost ANY city could find itself in when no one is paying attention.

Although Scranton’s financial crisis is more recent, the foundation for it, like the recession that currently grips the whole country, was laid years ago quietly and surreptitiously. Like many city authorities, the Scranton Parking Authority has the ability to issue bonds on projects such as new parking structures, and these bonds are backed by the full faith and credit of the city (and it’s taxpayers). Even during the worst of the nationwide financial crisis, bond investment has remained strong, so bonds have continued to be a preferred option for paying for city projects. The idea is that the bond helps pay for the initial costs of a project like a parking garage, and then once the new structure is completed payments are made on a regular basis to the bond. So long as the project is something that will turn a profit, the bond gets paid off and the city is left with a shiny parking structure or sports arena or whatever.

Problems arise when the bond payments can’t be met though. Because the bonds are backed by the city, the city is then on the hook to make the bond payments with taxpayer money. And usually, such as in the case of the Scranton Parking Authority’s bonds, these bonds were issued without any kind of outside oversight or voter approval, even though it’s the voters being put on the hook. And the SPA issued a number of these over the years to build parking structures when the ones they had weren’t even filling up. Now according to rumors from some members of the Scranton City Council, these structures were built not because of a need by the city, but to facilitate political cronyism by giving contracts to a local construction company. Considering that a quick look at the past ten years of financial reports for the SPA shows that most of the new parking structures were built after revenue had already plateaued and that each of these structures made the SPA progressively more financially unstable, that charge probably isn’t too far off the mark.

Despite warnings of financial insolvency in the SPA’s annual financial audit, little seems to have been done to right the ship, and by last June the SPA found itself on the hook for a more than $3 million dollars in loans that the city council didn’t even know about and a bond payment that they couldn’t make. It was at this point that the SPA came to the council about making the bond payment. And rather than making the payment, and despite the warnings of Mayor Doherty, the council decided that now was the time they were going to put their feet down and take a stand for austerity by refusing to make the bond payment. By defaulting on the payment, they effectively destroyed the full faith and credit of the city of Scranton. Suddenly, the city found itself no longer having access to the credit market. This proved devastating.

The city was already suffering from having more indebtedness than revenue, and without access to credit markets, they couldn’t receive the credit needed to cover the city’s expenses. By July, the city had $5 in it’s bank account and had had to reduce all city workers’ wages to minimum wage; to put that in perspective, the city of Scranton found itself with same level of fiscal solvency as your average hungover college student in line at Taco Bell. SPA employees found themselves furloughed and not getting paid, and are now negotiating with the city to try and get their back pay and contemplating suing for their wages. The courts appointed a receiver to take over the SPA, and a parking management company, Central Parking, was hired to take over running the parking business.

Needless to say, things were grim. Since hitting rock bottom in July, the city has been struggling to recover. Employee wages have normalized again, and the city has gotten court permission to pursue a nearly $10 million loan to cover their costs. It’s still unclear whether SPA employees will be paid their back pay, or if they will have to sue the city for months of unpaid wages. Scranton is by no means out of the woods, as they are still racking up more costs than revenue for the operation of the city. Scranton’s way forward is unclear, but for the rest of us this city provides a cautionary tale that we can all learn from.

First, we learned that apparently after leaving Dunder-Mifflin, Michael Scott became the head of the Scranton Parking Authority (or was at least consulting on how to run it). But more importantly, we learned that an unchecked mandate and a lack of oversight wreaks havoc, whether it’s on Wall Street or a city like Scranton. Whether looking at Scranton or Port Everglades (as in my last post), it seems like when you take an otherwise sound business person and put them in charge of taxpayer dollars, all business and common sense goes out the window. Taxpayer’s are not an unlimited source of money, they are investors expecting a return, whether in social or financial gain. Especially in light of the recent election, this illustrates just how big an impact those smaller, local issues can have on a community, and why it’s important to pay attention and stay engaged. Because otherwise all it takes is a parking authority, a school board, a commission, or some other small piece of local government that through ignorance and recklessness tugs on the yarn of city government and unravels the whole thing.