Comments on: Chicago Outsources Parking Reform to Morgan Stanley

By: Scott

Scott — Tue, 16 Dec 2008 18:54:50 +0000

I really can't believe we are doing this. I think the citizens deserve a better deal than this. I don't understand why Daily can't get the city council to approve meter rate raises and parking lot tax increases but he can get them to approve selling pieces of the city away like that. I hope he vetoes this. The last thing the city, citizens or developers need is a party with no interest in the city being involved in how we develop and operate our streets.

By: Daniel Nairn

Daniel Nairn — Mon, 15 Dec 2008 23:30:59 +0000

Chicago isn't really mortgaging its future to attend to the present. They are locking away $400 million of the $1.15 billion, and using the interest to replace the funds they had received from parking.

They are losing control and potential (assuming the political will could be generate to tap it), but they are not losing any money in the long term.

By: Lee

Lee — Mon, 15 Dec 2008 11:26:54 +0000

If you believe that massive inflation is about to take place (as I do) then this looks like a pretty crappy deal for the city. They will squander that payout in record time. Not to mention they are no longer easily able to change out the auto parking for complete streets, etc. So stupid!

By: JK

JK — Sat, 13 Dec 2008 20:12:40 +0000

Fritz, 9th avenue in Manhattan is a good example of a complete street design that swapped traffic capacity for a protected bike lane without the loss of curbside parking. When double parking and cruising are reduced through higher meter prices, you can, and should, reprogram space taken by traffic lanes and leave the parking capacity alone. Agreed that Chicago does not appear to appreciate the transportation implications of their privatization, nor did they dedicate some portion of the upfront payment to streetscape and transportation improvements.

By: Fritz

Fritz — Sat, 13 Dec 2008 13:40:10 +0000

The good:

* The system gets $1.15 billion
* Market rate parking makes parking a commodity and not free
* People can't just lobby a few politicians to get free parking back

The bad:
* Chicago spends $1.15 billion in 20 years and realizes it has lost a source of revenue
* Morgan Stanley sues Chicago when they try to eliminate future parking spaces to make way for better sidewalks, bike lanes, etc
* City loses control of its land

I am worried that it means they won't be able to make complete street changes AND that they'll squander the money in too short an amount of time.

By: Ian Turner

Ian Turner — Sat, 13 Dec 2008 04:11:23 +0000

JK,

From appearances Chicago is not looking more than a few months ahead.

By: JK

JK — Fri, 12 Dec 2008 23:46:52 +0000

Ben --- if cruising is say a quarter to a third of traffic and you eliminate it through higher meter prices, you've got a lot of extra street capacity to potentially reprogram for wider sidewalks, curb extensions, BRT, protected bikeways etc. If you do nothing, then the cruising will eventually be replaced by more traffic. Chicago isn't thinking this far ahead, but they should be.

By: ben

ben — Fri, 12 Dec 2008 21:09:35 +0000

how does this play into getting rid of parking and making sidewalks bigger?

In 2080 they might want to.

By: Heather

Heather — Fri, 12 Dec 2008 20:13:41 +0000

A DAY OF RALLYING!
TUESDAY, DECEMBER 16, 2008
5:00 PM
Assemble at MTA Headquarters
347 Madison Avenue at 44th Street

IN ORDER TO PROTEST:
SERVICE CUTS
FARE HIKES
LAYOFFS

By: Larry Littlefield

Larry Littlefield — Fri, 12 Dec 2008 20:10:53 +0000

(This is a brilliant idea if you think cars and parking are going away.)

Not if it means that if Chicago wants bike racks where the car parking used to be, Morgan Stanley gets to charge for that, too.

By: Jeffrey W. Baker

Jeffrey W. Baker — Fri, 12 Dec 2008 19:55:18 +0000

This is a brilliant idea if you think cars and parking are going away. Chicago has secured, at a reasonable rate, a future cash flow that stands a very good chance of disappearing. Morgan Stanley could end up in the red on this deal, in the long term.

By: Joby Jacob

Joby Jacob — Fri, 12 Dec 2008 19:42:07 +0000

one advantage of selling it for 75 years though, is that by the time the franchise is over, no one will remember the days of cheap parking. There will be less impetus to push it and make parking free. So in one small sense, it seems smart.
Requiring a council vote on increases though is going to end up being a problem, like when fare increases on the IRT & BMT subways were subject to city approval here in nyc, and thus fare increases were never improved, and the subway companies were slowly bled dry.

By: Larry Littlefield

Larry Littlefield — Fri, 12 Dec 2008 19:38:57 +0000

To me this is no different than the Ravitch plan.

Yes, there is an attractive aspect to each in the allocation of scarce space, tolls and on-street parking. But the sell out of the future to cash in during the present is so much more important than anything use that anything else is irrelevant.

The future of our country, city, and state is being sold out from under us, every day, by people with power and a runaway sense of entitlement.

By: Boris

Boris — Fri, 12 Dec 2008 19:35:33 +0000

How is this "outsourcing political will" if the City Council votes on the meter rates anyway? In an ideal world, the city of Chicago would side with the people and aim to put the corporation out of business by investing in transit and making the meters useless. But with the promise of making "the private operator whole" that's not likely to happen.

By: JK

JK — Fri, 12 Dec 2008 19:23:03 +0000

Good question Eric. Maybe a muni finance person could explain this. I don't know why Chicago couldnt bribe itself with a big upfront payment based on bonding off of higher rates. Based on my rough calculations it appears they got more upfront in present value than the existing $20mil/yr net parking revenue, but a lot less than the present value of the $60 to $80mil generated by the new rates. I'm waiting for my bond guy to lay the numbers out.

By: Rhywun

Rhywun — Fri, 12 Dec 2008 19:18:07 +0000

Selling 75 years worth of parking revenue to help plug a budget gap in your notoriously corrupt and mismanaged city seems like a colossally stupid idea to me. What tricks are they going to come up with next year?

By: Larry Littlefield

Larry Littlefield — Fri, 12 Dec 2008 19:05:09 +0000

"These folks need to go to jail stat. i don't think people could have known this was going on."

They are only giving up 75 years of parking revenue for money to spend in the next few years.

May I remind the audience that the Ravitch plan involves securitizing a 0.33% wage tax increase into the indefinate future to spend in the next few years, as far was we know.

Why did the framers of the NY State Constitution put in that now-dispensed with clause about debts requiring a referendum? Think about it.

By: Peter Smith

Peter Smith — Fri, 12 Dec 2008 18:52:36 +0000

oh my god. whose the mayor of chicago? those people need to go to jail. you can't just give away the city like that can you? i mean, i understand politicians have been doing this kind of thing forever, now, but 75 years of parking? wow - it's classic - it's straight-up robbery. these folks need to go to jail stat. i don't think people could have known this was going on. someone need to call in Fitzgerald, stat.

By: Eric McClure

Eric McClure — Fri, 12 Dec 2008 18:46:52 +0000

Couldn't the City of Chicago securitize future parking revenue without having to sell the concession to Morgan Stanley, using that future revenue to borrow money now? Or has the market for that sort of thing disappeared? I'm not really a fan of putting things like highways into private hands, and recent financial developments around the globe have shown that the private sector doesn't necessarily do things better or more efficiently than government.