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Parking Privatization Efforts Not Spreading Smoothly

In the wake of the problem-plagued privatization of Chicago's parking meters in 2008, two WSJ reporters assess conversions (or attempts) in Indianapolis (2010), Pittsburgh, Los Angeles, Cincinnati and New York, as well as what went wrong in Chicago.
January 28, 2013, 8am PST | Irvin Dawid
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Privatization efforts would presumably be faring much better if the initial program in Chicago had gone smoother. However, new smart meters and dynamic parking management may also be putting a damper on privatization efforts as they enable a city to better manage its meters. At stake for privatization are 85,000 on-street metered spaces in New York City. Ted Mann writes that the NYC DOT has "decided instead to move ahead with meter-modernization efforts of its own later this year."

"In order to proceed with this venture, a private operator would have to demonstrate that they could significantly improve on the city's financial and operational performance," a city official said. "It was just not clear enough to us that this was possible."

Caroline Porter writes about the difficulties that Chicago has encountered with the 36,000 meters now leased by Chicago Parking Meters LLC, with whom the city is in arbitration. One of the arbitrated issues is loss of revenue from spaces occupied by the disabled that need not pay. Next year a law goes into effect which takes away that exemption.

The 2010 Indianapolis deal has gone better than Chicago's.

Aaron Renn, a prominent blogger on urban affairs, criticized the Indianapolis deal as a misuse of public assets, but he said it is "certainly more successful than Chicago," with smarter contract stipulations.

The Cincinnati plan to "privatize its parking system in part to fill some of a $34 million deficit for this year" is proceeding. "Officials plan to present their suggested buyer to Cincinnati's city council in February", write Porter and Mann.

Both the Pittsburgh effort to help pay for city pensions and the Los Angeles plan to privatize parking garages are on hold. In LA it is due to "public concern over potential rate increases and other issues, according to Miguel Santana, the city administrative officer."

Had the Chicago deal produced better results, efforts to privatization meters in other cities would perhaps be further along.

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Published on Saturday, January 26, 2013 in The Wall Street Jounal
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