EDITORIAL: Cincinnati Should Embrace John Cranley’s Residential Parking Permit Idea

We subsidize parking for automobiles in almost all situations in our society, but it is especially true when it comes to public parking. This can be seen quite clearly throughout the city where public parking garages, lots and on-street spaces are regularly priced below market rates.

A recent proposal by Cincinnati Mayor John Cranley (D) to charge $300 annually for a residential parking permit in Over-the-Rhine was met with immediate criticism. Perhaps the criticism was fair given that such a rate would be the highest in the country by a long shot. And yes, that includes far higher than what’s charged in San Francisco, Washington D.C. and New York.

UrbanCincy, however, believes this says more about the sad state of subsidizing parking than anything else. In fact, we believe that the $300 annual parking permit is reasonable.

To better understand how this proposed permit fee stacks up, let’s consider that it averages out to approximately $25 per month. According to the most recent State of Downtown report, the average monthly parking rate in the Central Business District, Over-the-Rhine and Pendleton is $89. This average accounts for approximately 36,400 monthly parking spaces available in 2013.

While this average monthly parking rate is skewed by much higher rates in the Central Business District, many lots and garages reserved for residential parking in Over-the-Rhine charge between $40 and $110 per month. This means that Mayor Cranley’s proposal would put the city’s on-street parking spaces nearly in-line with their private counterparts.

This is a smart move. We should stop subsidizing parking as much as possible. Therefore, such a proposal should not only be examined in greater depth for Over-the-Rhine, but all of Cincinnati’s 52 neighborhoods.

According to parking management policy expert and UCLA professor Donald Shoup, charging market rate prices is particularly important for a variety of reasons. One of the primary reasons, however, is the fact that the higher prices will cause higher turnover and thus positively influence a number of other factors such as reduced congestion from cars circling the block and reduced pollution from those cars’ exhaust.

UrbanCincy recommends identifying what the market rate for parking is throughout the city and establish districts where on-street residential parking permits can be purchased. The proceeds from those permits could then be reinvested back into those neighborhoods for improvements of selected by those neighborhoods.

In Over-the-Rhine it has been suggested that the money could go toward offsetting the operating costs of the first phase of the Cincinnati Streetcar, but in other neighborhoods it could support public art, cleanup activities, public art or whatever it is that neighborhood desires.

This may not have been what the mayor had in mind when first proposing the residential parking permits for Over-the-Rhine, but if it was then Mayor Cranley deserves serious kudos.

Covington Estimates It Will Make $516,113 on Parking This Budget Cycle

While Cincinnati leaders would like to see their parking system generate more in revenue than it costs to operate and maintain it, that is not the reality. It is, however, the reality across the river in Covington.

A review of Covington’s recently approved 2014-2015 budget estimates the parking system will bring in approximately $1.6 million in revenue, while costing only $1.1 million for operations, maintenance and upgrades.

One of the largest chunks of Covington’s annual parking revenue, however, comes from lease payments which total about $491,000 – or nearly one-third of the city’s annual parking revenues.

Had Cincinnati followed through with its parking lease agreement, it too would have realized these benefits by offloading expenses and locking in fixed lease payments. Under Cincinnati’s parking lease, the city would have received anywhere from $3-4 million in annual payments from the concessionaire.

In order just to break even, the City of Cincinnati has and continues to defer needed maintenance and upgrades, while also depleting its parking fund.

Covington will also benefit from increased parking rates, which will net the city an additional $68,500 in the first year. Those changes include a 10-cent per hour increase for on-street parking meters, and a $2 per day increase at the RiverCenter Parking Garage.

In addition to on-street parking meters throughout downtown, Covington has 818 parking spaces in 16 surface lots and another 1,574 spaces in three different parking garages.

How to repurpose parking garages that are becoming increasingly obsolete

There are far more parking spaces in America than there are cars. The total is so high, in fact, that there are even more than double the number of parking spaces in America than there are people. There is a parking glut, not a shortage, and this problem is getting worse as more and more people are choosing not to drive at all or at the very least drive less.

What this means is that parking garages need to be designed in a way that will allow them to be repurposed for other uses. In Cincinnati, this is playing out at the new dunnhumbyUSA Centre where its garage is being designed so that office space can be built in its place in the future. All parking garages, however, should be designed in such a way. More from NextCity about how leaders in Atlanta are working toward just that:

On Wednesday the school unveiled SCADpad, a series of three micro-housing units in a parking garage near its Midtown Atlanta campus. The idea is a novel yet simple one: Repurpose underused parking garages — about 40,000 parking structures in the U.S. operate at half capacity, according to the Urban Land Institute — for housing in dense areas that need it. The 135-square-foot micro-apartments each take up one parking space, with an additional space for use as a “terrace” (seriously!), and were designed by 75 current SCAD students, 37 alumni and 12 professors. A dozen students will move into the apartments on April 15.

“Think about it,” Sottile said. “Many of these 20th-century parking structures are on their way toward obsolescence, and we’re asking questions about how those can be reinvented for neighborhoods. There’s also a historic preservation side of this. And we want to see how can we get them back into higher usage.”

EDITORIAL: Eight-Point Plan for Fixing Cincinnati’s Broken Parking System

Cincinnati Parking Meter

Broken and malfunctioning meters plague Cincinnati’s parking system. Photograph by Randy Simes for UrbanCincy.

We are continuing to look at opportunities inside City Hall that could help alleviate Cincinnati’s budget and pension liabilities, while also maintaining and improving service delivery.

In addition to the waste collection reforms that include a shift to a Pay As You Throw system, we will be making other specific policy recommendations that we feel will improve the quality of service delivery while also improving the City’s finances – ultimately working toward a long-term, structurally balanced budget.

Back in June 2010, UrbanCincy examined the finances of the city’s parking system. In this analysis, and comparison with cities from around the country, we discovered a broken system that was not performing the functions it needed to perform, and was not financially solvent.

As a result, we recommended a seven-year lease of all 5,700 of the city’s on-street parking meters. We estimated that such a deal could yield just over $3 million in annual payments, while also ridding the city of the associated financial liabilities. We did not estimate what an upfront payment could be due to the infinite number of variables that could affect that.

While much has changed politically since that time, the facts remain the same. Cincinnati’s parking system is broken, and is in need of immediate upgrades and reforms.

One of the first actions by the newly elected Mayor John Cranley (D), however, was to halt the signed Parking Lease & Modernization agreement, executed by former City Manager Milton Dohoney, which was structured to solve these exact problems. Under that deal the City would have leased four parking garages, one parking lot and all of the City’s on-street parking meters to the Port of Greater Cincinnati Development Authority.

The Port then agreed to work with Xerox to manage the system and implement comprehensive upgrades to the deteriorating and outdated system. This would have included electronic parking meters that accept credit cards, real-time parking availability data systems and the rehabilitation of existing lots and garages.

The deal would have also provided the City of Cincinnati with an upfront payment of $85 million, generated approximately $3 million in annual installment payments over the life of the agreement, and guaranteed approximately $98 million in capital investments into the system. For better or worse, that agreement has been jeopardized and we are essentially back at square one.

So where and what exactly is square one?

The City has been experiencing declining revenues from its parking assets for several years now. Revenue collections peaked years ago, but have been declining recently due to inadequate enforcement and the parking system’s poor state of repair. These assets require constant and expensive maintenance and upgrades, so virtually all of the money generated by the Parking System is spent maintaining the Parking System.

This is important. The Parking System does not generate any excess revenue for the city to use on other basic services.

In most years the Parking System is revenue neutral, meaning that the revenues it generates cover its expenses. This is acceptable, unless you are deferring maintenance costs in order to make the numbers match. This has been the case in Cincinnati for years, and has left the Parking System in terrible condition.

The situation has gotten worse in recent years as council has worked to balance the budget without laying off employees. In both 2010 and 2011, the city spent considerably more on the Parking System than it collected in an effort to keep it up to snuff. We are talking $3.6 million more in 2010 and $1.1 million more in 2011. This stopped in 2012 when the city cut its annual investments in the Parking System by several million dollars.

Cincinnati's Broken Parking System

For reference, investments in the Parking System today are approximately 38% lower than they were when the City invested $13.3 million into the Parking System in 2010. Over that same period, the parking fund balance has dropped from $12.5 million to $7.8 million.

Simply put: revenues are down, maintenance is being deferred and the parking fund is being depleted. This is not sustainable.

The recent proposal from the Cranley Administration, which was immediately and thoroughly rejected by just about everyone except five council members, does not address what the problems are, and therefore does not propose appropriate solutions for those problems.

The situation and trajectory is dire and UrbanCincy recommends that the City of Cincinnati move forward with upgrades to its Parking System immediately. Absent the previously agreed upon Parking Lease & Modernization deal or some other public-private partnership; here is how we suggest doing so:

  1. Issue bonds to upgrade all parking meters in the city to use the latest electronic payment collection and occupancy tracking technology. This would include pay-by-phone capabilities.
  2. Utilize the new technology to implement variable pricing structures that reflect real-time market demand. If there is a Bengals game downtown and meters near the stadium are packed, then the rates on those meters would increase, while meters further away would maintain lower rates. In neighborhood business districts the same would be true. When demand is high so should be prices. When demand is low, prices should drop accordingly to make it a more attractive option for those visiting our neighborhood business districts.
  3. Release a new application, website and text alert system that notifies drivers of parking space availability and informs them of the associated rates.
  4. Sell the city-owned parking lot at Third Street and Central Avenue so that it can be repurposed into a tax-producing property.
  5. Create a special lease agreement for city-owned parking garages and lots, so that the separate authority could manage advertising at these locations. The Ohio Revised Code currently does not grant cities authority to sell advertising in such a manner, but not allowing for advertisements is unnecessarily cutting off much-needed revenue. Let’s get creative so that we can maximize revenues without burdening our residents, businesses or visitors.
  6. Tear down the Garfield Garage, which is in greatest need of repair, and market the site to developers interested in building on it. Such a development agreement could include the provision of the same or greater number of parking spaces to be replaced – similar to the deal signed for the new residential tower to be built at Fourth and Race Streets in the place of the Pogue’s Garage. This will free the city from a major capital expense that would further deplete the parking fund in the near future.
  7. Tear down the Seventh & Sycamore Garage, which is the only thing blocking the construction of a $14.2 million, 115-room hotel and 725-space garage from being built in its place. The existing 450-space garage is also in poor condition and its removal would be another major liability coming off the City’s books.
  8. Conduct a citywide study to determine appropriate adjustments to the hours of operation for on-street parking meters on a neighborhood-by-neighborhood level.

Following through on these eight recommendations will allow the city to maintain ownership and control of its Parking System while also allowing it to make the necessary upgrades and improve the balance sheets for this portion of the budget. These changes will make the Parking System a revenue generating asset not just in rhetoric, but in reality.

The increased revenues will allow for the City to replenish the parking fund, make its upgrades and take additional revenue and use it to support other essential but non-revenue generating public services.

Month in Review – August 2013

During the month of August, UrbanCincy covered several new developments and events in the city’s urban core. We also published two editorials that generated much response from our readers and the local community. Our  top 5 most popular stories for August 2013 were:

    1. Final Designs Revealed for $125M Dunnhumby Centre Tower
      The long-awaited renderings for the Dunnhumby Centre at Fifth and Race have been released.
    2. It’s Time to Consolidate Local Governments in Hamilton County
      This editorial by Randy Simes has generated over 100 comments on UrbanCincy. Randy was also invited onto 700 WLW to discuss the idea with Scott Sloan, and the Cincinnati Business Courier also provided their own analysis of the idea.
    3. Over-the-Rhine Impresses More Than 30,000 Spectators for LumenoCity
      Paige Malott and John Yung provide photos from the event that attracted over 30,000 visitors to Cincinnati’s Over-the-Rhine neighborhood.
    4. Cincinnati Eliminates Center City Parking Requirements, Neighborhoods Next
      Randy Simes analyses the city’s move to deregulate parking within the urban core.
    5. Greg Landsman: Riding the Cincinnati Streetcar to Success
      In this editorial, City Council candidate Greg Landsman explains why he supports the Streetcar and why it should be extended to Uptown.