Indianapolis May Privatize Parking Meters To Raise Revenues

Mayor Greg Ballard's administration is pondering a plan to enter into a long-term lease with a private firm to operate the City's parking meters as a quick way of raising significant revenues, perhaps as much as $100 million according to the IBJ's Cory Schouten. A similar privatization scheme for Chicago netted $1 billion for the over-taxed and bankrupt city to the north, but it left commuters fuming as parking meter fees skyrocketed. While Chicago used its windfall to fix a big hole in its budget, Ballard's administration wants to use the funds to make sewer and road improvements.

Several well-known firms, including Denison Parking, KPMG, Michigan-based Carl Walker parking, Maryland-based IMG and ACS, one of the company's currently managing the botched privatized welfare services for FSSA, have submitted proposals to the City in response to an RFP. One thing is certain, parking meter rates will go up substantially from the City's current 75-cent per hour rate. Some plans call for extending the time fees are charged from 6:00 p.m. to 10:00 p.m., a move that could hurt downtown businesses.

Any privatized meter plan will likely see the introduction of meters that allow payment by credit card or cell phone. At the same time, the City is likely going to raise parking rates for the approximately 10,000 off-street spaces it controls with the Capital Improvement Board. Denison Parking is currently under contract to enforce the City's parking meters. The City pays Denison about $330,000 a year according to Schouten. Parking meter revenues annually are about $2.2 million, while parking citations rake in $2.7 million. With $1.1 million in expenses, the City nets about $3.5 million.

I have a simple solution for boosting parking meter revenues. Anyone who spends any time downtown has noticed the common practice of city workers coming around bagging parking meters for special events and planned construction work well in advance of the event or planned work. This practice infuriates business owners, particularly along Massachusetts Avenue, who sometimes take it upon themselves to post signs on the bagged meters advising people to park there for free because the event won't take place until the next day.

As for the City potentially looking for a short-term windfall for a long-term deal, I think the Ballard administration is playing with fire. When the City says it wants to use this money for road and sewer projects, that tells me the deal will also involve long-term borrowing through bonds. Inevitably, the City winds up spending a far greater sum than it derived from the initial lease of the asset. I hope the Ballard administration takes a hard look at these proposals and acts according to the best interests of the taxpaying-public and not the lawyers, consultants and campaign contributors pushing this idea.