Is Anyone Really Surprised? Parking Meter Deal Nets Less Than Expected

Its not like the Ballard Admininstration truely sold the residents of Indianapolis on the desirability of leasing our parking meters to an ACS group for 50 years.  Its more like they forced it through simply because the Republicans held the majority on the Council and they could.

Still, they made representations.  Turns out, those representations didn't hold water, even for the very first year.  Is anyone really surprised?

Jon Murray did an excellent job of running through all the numbers he could get his hands on in this morning's IndyStar ("Indy parking revenues fall short of projections") - the ACS group, ParkIndy, will not open their books so that the public, or even Mayor Ballard himself, can review the numbers for accuracy.

Murray reports:

The first year of Indianapolis' 50-year parking meter lease brought doubled rates in some areas as a tradeoff for a wholesale upgrade of equipment and the convenience of paying by credit card or smartphone.

Was it worth it?

New financial data provided by the city shows its share of revenue from the vendor in 2011 -- nearly $1.4 million, or 30 percent -- fell well short of the city's own projection of $2.1 million.

And the city didn't end up seeing the full amount: After the vendor subtracted $286,000 in charges to compensate for the city closing metered spaces, often for RebuildIndy road construction work, the city pocketed $1.1 million.

The budget for last year relied upon revenues of $2.4 million from 'charges for services' and $1.8 million from 'fines and penalties' for a total of $3.2 million - a far cry from $1.1 million.  That budgeted amount was not just a gravy account, as $3.8 million was being used to help fund IMPD that year.  (2011 budget - Prop 2010, 234 -- p 22 and 59 of pdf)

The budget for 2012 reflects the drop in revenue the Ballard administration fully expected from the parking meter contract.  Instead of the roughly $3.2 million revenue budgeted year before year earlier, the 2012 budget only anticipated $1.25 million from 'charges for services' and $0.5 million from 'fines and penalties' plus a bit more for a total of $1.8 million.  (2012 budget - Prop 2011, 241 -- p 25 and 62 of pdf)

Mayor Ballard, however, tries to low ball the profit to the City prior to the sale of the parking meters :

Ballard cites an $87,000 profit for 2010 -- the last year before ParkIndy's contract began -- but that figure overstates the tightness of the margin. It reflects the spending of some proceeds on street improvements.

Looking only at that year's operating costs -- $3.2 million -- the city pocketed a modest $600,000 profit, according to Darrell Fishel, an assistant public works administrator for the city.

Murray mentions the street improvements, for which $327,200 was appropriated that year, but his report does not bring up the $1.75 million that went to IMPD that year and what actual police ticketing costs were.  (2010 budget - Prop 2009, 321 -- p 22 and 56 of the pdf)

ACS/ParkIndy made out well from what numbers Murray could get:

The vendor, ParkIndy -- a trio of local and national companies led by Dallas-based ACS, a Xerox company -- kept more than $3.5 million.

 Mayor Ballard also cites the $20 million up front payment made by ACS/ParkIndy as part of the deal.  Murray has new information about that money, as well.  In a side panel in the paper version, Murray shows the following expenses paid from the $20 million (my wording):

$6.4 m - Broad Ripple Parking Garage
$5.9 m - road and infrastructure repairs downtown
$3.5 m - transition and advisor costs covering the parking meter deal itself
$3.8 m - to IMPD

The transition costs included $2.9 million to pay the high priced lawyers who cut and pasted the Chicago deal and those who were hired to be proponents of the sale and market the sale to the public (unsuccessfully, I might add).  The last charge, to IMPD, may sound familiar.  Above I noted that the 2011 budget called for $3.8 million to go to IMPD from the parking meter fund.  With the budget under pressure, the parking meter fund doubled what it usually sent to IMPD.  But the Ballard administration is now spinning it to be "reimbursement to IMPD for assisting with parking meter enforcement going back several years".   Shameless.

So folks, of the $20 million up front fee, all you really got was the Broad Ripple Parking Garage boondoggle.  Oh well.  Easy come, easy go.

Murray's article quotes City-County Council Vice President, Brian Mahern:

Mahern was among vocal critics who noted many large cities have modernized their meters by borrowing or striking shorter-term contracts. 

"We should have just worked with a vendor to provide us the service for a fee," he said, "rather than granting somebody an equity stake for what is a basic service."

Absolutely right.