Parking Commission Looking Past Economics

March 26, 2008
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GRAND RAPIDS — Should the city’s Parking Commission raise parking rates? If so, by how much and where? Should rates be raised according to the Consumer Price Index or should they go higher or lower than that? Should they be raised just at the meters, or should an increase also apply to ramps and lots?

The answers to those questions are more than economic ones for the current group of parking commissioners, as an environmental concern also entered into their first discussion of the annual rate review.

The recent finding from the Environmental Protection Agency revealing that the smog level throughout the county was above acceptable standards caused commissioners to talk about on-street parking and the meter rate. Most of the discussion focused on whether to raise the meter rate to a point that would push on-street parkers into ramps or lots, similar to how higher gas prices have curtailed the number of miles some people drive.

The idea underlying that action is to stop these parkers from circling city blocks while looking for an open meter and thus reduce the amount of exhaust released into the air. The theory behind hiking the meter rate is there would be less congestion on city streets and fewer toxins floating through the city.

“I think it’s the wrong time in this economy to raise off-street (rates),” said David Leonard, parking commissioner, of prices at city ramps and lots. “But not on-street.”

“I love the theory of keeping the ramps low and the street high,” said Parking Commissioner Kathy Clements of prices.

Clements also said that she wasn’t certain what effect higher meter rates would have on traffic to downtown businesses. In the downtown core, a quarter buys a parker 10 minutes of parking. Outside of the core, a quarter is worth 30 minutes.

“I think it’s a terrible time to raise rates,” said Parking Commissioner Kevin Denhof.

“How do we know we’re doing the right thing?” he asked.

Denhof said the commission needs to find an objective measurement on which it can base its decision for this year and the next five years. One of those measurements is the price that comparable cities charge. Another is a book on parking economics that Parking Services Director Pam Ritsema mentioned, and has read, which explains the effect parking rates have on a local economy.

“I think that’s a good point we need to discuss,” said Commission Chairwoman Lisa Haynes.

A city ordinance requires the commission to review rates every year, and the decision the board makes will directly affect the department’s annual budget, as Parking Services doesn’t receive tax dollars from the city. In most years, rates have been raised by the annual inflation figure that is released in the spring.

“We are supposed to set rates to cover our operations, maintenance and parking expansion, but not to make a profit,” said Ritsema.

Parking Services has two major expansion projects on its drawing board and both are expensive. One is a 360-space ramp planned for Commerce Avenue and Weston Street for an estimated cost of $11 million. The other is a ramp with 262 spaces at Division Avenue and Fulton Street, which will likely cost $9 million. The per-space costs are $30,500 and $34,350, respectively.

The 2008 construction cost survey for parking facilities released last fall by Carl Walker Parking, a Kalamazoo consultant, sets the national median cost at $14,631 per space. When the Business Journal asked Ritsema why the city’s cost was so much higher than the national figure, she said her costs include more charges than Walker does in its report.

Ritsema said Walker reports the construction cost, while her figures include engineering and architectural charges, utilities, consulting fees and land purchases, like those her department is doing for the Commerce ramp. She also said the Walker figure represents the cost to build a ramp with a basic concrete façade, while the city’s facilities, like the Monroe Center ramp, look more stylish to fit in with the surroundings.

Commissioners have to make a decision on parking rates by their June meeting, at the very latest, to give city commissioners a chance to review the charges before the fiscal year ends on June 30.

Parking Commissioner David Kammeraad took a pragmatic role in the discussion by noting that the price for everything is rising and it is only a matter of time before the cost of parking will have to go up, too.

“You’re certainly going to have pain, whether you do it now or you do it in three years.”

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