City Parking Decisions Coming

July 28, 2007
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GRAND RAPIDS — City commissioners indicated last week they would decide in two weeks whether to take the net revenue Parking Services gets from violations and deposit the money in the city’s ailing general operating fund and whether to accept an offer to sell two-thirds of the public downtown parking system.

The Parking Commission filed its recommendation not to sell four city-owned ramps and 10 lots to Third Coast Development Partners with commissioners last week. Third Coast has offered the city up to $45 million for the 14 downtown facilities. The firm has also said it was willing to negotiate another price and was interested in discussing a lease arrangement.

Parking Commission Chairman Jack Hoffman told city commissioners parking plays an essential role in downtown’s economic development, and selling the lots and ramps would result in the city losing control over those properties.

“We are still open to dealing with private developers to sell individual lots,” he said.

But 2nd Ward City Commissioner Rick Tormala said the Parking Commission didn’t take a hard enough look at the millions the city would get for the general fund from a sale to Third Coast. He said the decision board members made was swayed by developers and commercial realtors who voiced their opposition to the sale but also have a vested interest in the downtown properties.

Tormala also criticized the commission for not looking deeper into leasing the facilities to Third Coast, even though the firm hasn’t submitted an official offer to lease the ramps and lots. Tormala, though, implied that one may be coming soon.

“I think you will see a revised proposal,” he told Hoffman and city commissioners.

Third Coast Principal David Levitt said he was waiting to review the minutes from the last Parking Commission meeting before making a decision on which direction to take. He said he was interested in continuing the discussion with the city, if city officials are willing to listen to what his firm has to say.

“Candidly, there are a number of other municipalities that do appear to be more open to the idea than Grand Rapids is. So we’re looking at those, as well,” said Levitt.

Levitt said he agreed with the criticism Tormala threw at the Parking Commission, at least on one level.

“Nobody ever approached us once it got to the Parking Commission for a follow-up or an explanation or anything. They took the Power Point presentation we gave to the city, along with the city staff’s recommendation to kill the idea, and just used those (to make a decision.) We were not asked for anything,” he said.

But Levitt said Third Coast is still willing to talk about creating a lease with the city. He said whether it’s a long-term lease, a concession agreement, or a purchase, the three are essentially the same. All involve having control over a set of assets for a period of years.

“We have always maintained that we were willing to look at that,” he said.

Levitt said he and his partner Brad Rosely are also willing to talk to the city about buying or leasing individual facilities or a smaller group of lots and ramps, the type of proposal that parking commissioners said they were open to.

As for the revenue from parking violations, an estimated $290,000 would go into the current general fund budget should commissioners accept a transfer. Slightly more than $303,000 would go into next year’s general fund.

But the cash infusion has been projected to fall to $266,000 in 2010, to $229,000 in 2011, and to $206,000 in 2012. Enforcement and collection expenses are expected to go up those years, so the net revenue to the general fund will become progressively less each year, unless the fees for fines are raised.

“We are reluctant to let the parking fines go, but we understand the city’s situation,” said Hoffman, whose board agreed to the fund transfer on July 12.

Revenues to the current general fund have been projected to fall $5.2 million short of meeting the year’s expenditures.

City commissioners are expected to make decisions on the revenue transfer and parking sale on Aug. 14.    

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