Posts Tagged ‘Parking Authority’

It’s been an odd week in parking news, mainly because of two six figure stories on opposite ends of the spectrum. In Chicago, we finally have a resolution to the car that accrued more than $105,000 in tickets at O’Hare airport; and in Buffalo, NY we have a meter technician that was caught stealing $210,000 in quarters over 8 years. First, let’s take a look at the Windy City.

As some may recall, a car owned by Jennifer Fitzgerald of Chicago was left in the O’Hare International Airport employee parking lot for more than three years, accruing 678 tickets totaling $106,000 during that time. She filed a suit with the city, showing evidence that while the car had been in her name, it had belonged to a now-ex boyfriend for all intents and purposes. He worked at O’Hare, and was the one who abandoned the vehicle in the lot, refusing to have the car signed over to his name. With the car in an employee lot where she was not allowed to go, Fitzgerald was unable to retrieve it. On top of that, after a vehicle has been deemed abandoned for two to three months, by law the city is supposed to tow and impound the vehicle, but parking enforcement workers at O’Hare never did this. Instead, they continued to ticket the vehicle for years, not just fining it for parking violations but also for having illegally tinted windows or out of date city tags and registration. While parking enforcement denies having quotas, it’s fairly obvious that employees were ticketing this car again and again instead of towing it to boost some kind of metric that they’re evaluated on.

Yesterday, Ms. Fitzgerald’s suit was dismissed and a settlement agreed upon with the city. She would pay a total of $4500 to clear the tickets and fines, with a $1600 down payment to be made by her former boyfriend and the rest to be paid off by Fitzgerald in monthly installments of $78 for the next three years. While being less than 5% of what was owed, this seems like a fairly equitable settlement; the majority of those fines shouldn’t have been there as the vehicle should have been towed, the ex boyfriend is taking care of a big chunk of it, with the rest on Fitzgerald (who missed an earlier court date related to the tickets, thereby increasing them all exponentially). Still, the fact that it took more than three years to even notice this is alarming, and just goes to show just how lax city oversight of parking enforcement and operations usually is.

That said, Chicago is still ahead of the game compared to Buffalo, NY where city meter mechanic James Bagarozzo was sentenced to two and half years in prison for stealing more than $210,000 in quarters from city meters between 2003 and 2011. Using his position and technical skills, he rigged about 70 parking meters so that he could collect from them undetected. He would then go to the bank on his lunch hour and roll and exchange the coins. I once had to roll nearly $50 in quarters and other change, and that took hours; Jimmy Bagz (that’s what I’m calling him now) rolled more than 10,000 pounds, that’s five tons, of quarters! Jimmy Bagz had one co-conspirator, a co-worker named Lawrence Charles who helped with the scheme for five years and stole $15,000 in that period.

So how did they get caught? Well that’s the beauty of this story, one that just drives home the point I make again and again in so many of these stories: a little attention and oversight by the city’s parking management will save money and keep most parking abuses from happening. You see, Buffalo parking commissioner Kevin Helfer noticed that the digital meters in the city were making significantly more money than the old mechanical meters, which is odd. He had an investigation launched and using video surveillance they were able to discover that Jimmy Bagz had been stealing fro the old meters daily. When the FBI was called in and they confronted Jimmy Bagz, he admitted to the thefts (which are considered a federal crime). Since this debacle, the city has switched entirely to digital meters that take both credit cards and coins and are next to impossible to rob. Since making these changes and ending Jimmy Bagz’ scheme, city parking meter revenue is up $500,000 annually. With that kind of improvement, you have to wonder if there might have been others skimming off the top as well. Regardless, the city and it’s citizens are all benefitting from this wannabe Stan Smith finally being caught, and all thanks to a parking official that actually took their job seriously and paid attention to what was going on.

As of yet, there is no word on whether Kevin Helfer looks like Forrest Whitaker, but I find the story far more amusing to imagine he does.


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.

A banner promoting Dunder-Mifflin, the fiction...

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.

First off, I hope everyone had a great Thanksgiving. As much as I’ve been enjoying seeing family and living off of leftovers the past few days, it’s high time I finished regaling you all with the saga of Port Canaveral and how the local parking industry was nearly wiped out by a corrupt Port Authority.

Thankfully, two of the Commission members (Mr. Weinberg and Mr. Allender yet again) and a coalition of private operators raised the alarm and got organized, and were able to put enough pressure on the Port Authority to re-examine it’s new policies and rescind them. A special parking committee was made to examine parking option for the Port and make recommendations for it going into the future. Though Mr. Payne’s cronies on the Commission originally wanted to have it setup without any representation from a single private parking service, our two level-headed commissioners once again stepped in and got Todd Oakley, the man behind Cruise Parking of Port Canaveral, on this new committee to look after the interests of small businesses and parking operators.

 Now what could have fueled this craziness and abuse of a public institution by Mr. Payne? Well, you could ask him, but I doubt he’d be very forthcoming. Luckily, he’s given us some hints. You see, everyone at the Port Authority (besides the Commission members) gets a bonus based on how profitable the Port was over the past year. Up until a recently passed Florida state law, this only went to people in management roles. It now applies to all Port Authority staff, but while low tier staff were looking at a couple hundred dollars, management bonuses were in the thousands or tens of thousands of dollars, up to 20% of their base salary. For 2012, the Port had $300,000 of taxpayer money earmarked for these bonuses, bonuses that were going to go to people for trying to stamp out local businesses. As if this left any doubt that the bonuses were a big motivating factor in this debacle, the Commission voted at the end of September to get rid of the bonuses because of the negative effect they were having on the Port Authority (thanks again to our two small business heroes on the Commission).

 Given the recent debacle that occurred when Mr. Payne had the Commission approve an updated severance package for him that included an illegal two-year severance pay (but who can blame him for not knowing that, his legal background only consists of law and economics degrees, being commissioner of the Florida Ports Financing Commission, and his past 23 years of work before his job as CEO being Legal Counsel, Director of Law and Administration and Director of Legal services for private corporation and the Virginia Port Authority), and then had the Port Authority pick up the $67,000 tab for legal fees to sort out his “mistake”, I think it seems pretty obvious that Mr. Payne’s primary concern with the Port Canaveral Port Authority is how much money is it making for HIM, not the taxpayer.

 Thankfully, it seems that the voice of reason has returned to the Port Commission; but for how long? While I doubt that Mr. Payne has much time left in his role as CEO, one has to remember that he was appointed by the Port Commission, which is made up of publicly elected members. So take the time to look into your local government and who in it may have the power to affect your business, because otherwise you may be finding yourself being run out of business by someone you elected.

There must be something in the water down at Port Canaveral, or at least in the water that Port Authority CEO Stan Payne has been drinking. Over the past year, Mr. Payne has seemingly declared war on private sector parking operators at his Port, going so over the line that multiple members of the Port Commission have tried to get him to step down due to his egregious use of the Port Authority’s authority.

It began back in January, when Mr. Payne and his staff released what can only be described as an attack video on their website aimed slandering offsite parking services, saying that if you park at one rather than the port you will wait for hours, have your car damaged and broken into and your vacation ruined. The video is poorly done, the acting terrible, and their portrayal of offsite lots hilarious if you didn’t know they were being serious. While there are always some bad apples in any business, for the vast majority of parking facilities their claims just aren’t true. But hey, if you’re trying to get people to pay $34/day more for a parking space, I guess honesty is not going to be your ally. Not only did Mr. Payne come up with this video, he had it made and posted on the Port Authority’s website without bringing it to the Port Commission. Not only was there a furor from the commission, but the video was widely mocked and criticized by the local media as well. And all of this for the low, low cost of $18,000 of tax payer money to slander local businesses!

And as ridiculous as that is, it’s only the tip of the iceberg. Back at the beginning of the summer, Mr. Payne had an independent consultant brought in to do a presentation on their parking services and how they could improve them. At a recent meeting before that, the Commission had discussed numerous mostly in-house changes and improvements the Port Authority could make to improve parking revenue and traveler satisfaction, so this seemed reasonable, even if the commission was subjected to a surprise presentation by this consultant. Rather than talking about further in-house improvements that could be made, the consultant dedicated their entire presentation to painting a scary and completely untrue assessment of the “threat” presented by off-site parking facilities, and recommended various ways that the Port Authority could use it’s power to force them out of business. The Commission was then immediately called upon to vote on enacting these ideas, with no period of review or outside opinions. Despite the protests of two of the five Commission members (Mr. Weinberg and Mr. Allender), the Commission passed these new ordinances, including a moratorium on new port parking permits for any businesses and a $50 per trip fee for any offsite parking shuttle wanting to access the port. These policies would essentially kill the entire offsite parking business in Port Canaveral in one fell swoop, destroying multiple local businesses and putting dozens if not hundreds of people out of work.

And what was the reasoning for all of this? Profits. The consultant presented the offsite facilities as a clear and present danger to the Port Authority’s revenue stream. Now while that may seem like a reasonable concern (even if the response was unreasonable), it was not. The Port Authority had been making record profits. Going into the third quarter of 2012, they already had made more than $4 million more than the Port authority had made for the entirety of FY 2011. On their $20-$40/day parking, the Port made a 97% profit. The only thing they were in danger of was having to make too many deposits at the bank.

The story doesn’t end there either. Next week, I’ll talk about how the destruction of the local parking industry in Port Canaveral was narrowly averted and delve deeper into Stan Payne’s attempts to use the parking authority for his own gain.