City exploring options for possible long-term lease of parking system

Discussions about how to best manage the city’s parking program are continuing.

Last week, the Parking Advisory Board met to discuss the changes that have been implemented so far and other potential options, to include exploring a long-term lease for operation of the city’s parking system.

The city’s contract with SP+ expires at the end of the year and Craig Raymond, city planning director, is recommending a one-year renewal to give staff time to develop a request for proposals for a long-term lease for management of the city’s parking system, which includes the two garages, surface lots and metered parking downtown.

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Raymond said City Manager Greg Doyon has encouraged him to explore options for a long-term lease of the parking system in part as the city planning department is trying to narrow it’s focus to development related tasks and divest some things, such as parking.

“It’s important, but we have other priorities,” Raymond said.

A long-term lease contract would be a “big, big change,” Raymond said.

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Katie Hanning, a PAC member, asked if under a long-term lease arrangement the city would handle any parking disputes.

Raymond said no, the city would turn over management to a private company, including maintenance, but would retain ownership of the parking assets.

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“I don’t want it back if they break it. Not that it’s all perfect,” Hanning said. “I can’t imagine somebody wanting to do that.”

A number of cities have pursued long-term lease options or privatized parking with mixed results.

“I doubt that the city should look at this as a cash cow,” Raymond said.

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Raymond said he’s in the early stages of researching long-term lease agreements in use in other cities and that the city may have to hire a consultant to draft a request for proposals.

“It’s a big decision,” Raymond said and based on his preliminary searches, some communities that looked into long-term leases decided against it.

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He said the city wouldn’t ask SP+ to draft the request since the parking management company would likely submit a proposal as it’s been the city’s parking contractor for decades.

Raymond said during last week’s PAC meeting that he proposes continuing with the structural improvements that were planned for the meter rate revenue but to delay purchasing some new equipment in case the city does enter a long-term lease arrangement since different parking management companies have their own equipment preferences and then the selected company would implement the new equipment on its own dime.

On-street parking is an area that the city would want to retain some control, though, Raymond said, perhaps in the form of a maximum meter rate, since a private company would likely increase meter rates in order to turn a profit.

 

 

So far, the meter rate increase of about $86,000 since it took effect July 1 over last year’s revenues for the same time period.

Usage of the Passport Parking smartphone app has increased to about 14.3 percent, according to city staff.

The city planning department and parking board have been discussing for months the option to switch to Passport Parking for the collections side of parking citations as well.

With the current T2 software system, which is contracted under the city’s parking contractor SP+, the city pays $1,411 in monthly fees and about $50 per month for collections letters with about 70 letters mailed monthly. That’s about $17,500 annually.

With Passport, the monthly fee is waived but the customer pays a $3 fee per transaction. The cost for sending collections letters would be about $105, merchant fees would be $892 and Passport would take 25 percent of revenue generated through collections. The estimated monthly cost would be $1,137 for an annual cost of $13,650, according to city documents. Those figures don’t include the paper rolls needed for issuing parking tickets, and with that cost factored in, the city would save about $100 monthly, according to SP+.

But the efficiency and integration with other parking enforcement systems would be worth it, according to Dane Lyon of SP+.

Switching to Passport would also require the purchase of phone and printer sets for the parking attendants. The city would need three sets and probably a fourth as backup. The sets cost about $1,000 a piece, Lyon said.