No Decision Yet

May 21, 2007
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GRAND RAPIDS — The odds are parking commissioners will tell the City Commission not to sell two-thirds of the downtown public parking system to Third Coast Development Partners — or to anyone else, for that matter.

A more uncertain issue is when they will make that recommendation.

It could come in three weeks when the Parking Commission meets again. Or it could take a few months as commissioners gave themselves until August to decide whether to support privatizing most of the system and determine how much parking revenue they can transfer to the city’s struggling general operating fund.

Parking Commissioner Kevin Denhof, though, was ready to make at least one of those decisions at the board’s last meeting.

“I’m feeling that we’re being squeezed. I think selling the assets is the wrong way to go. It’s wrong to sell city parking. It’s a short-term answer, but it’s wrong,” he said.

Denhof pointed out that the Downtown Development Authority, which owns seven of the lots in the sale proposal, and the city’s Building Authority, which owns the debt on the ramps, have already reached the same conclusion.

Denhof also said selling the assets would reduce the financial clout Parking Services has to a point where it wouldn’t be able to help downtown develop economically in the future.

“I think we need to tell the City Commission that selling the parking facilities is not in the best interest of the city. Does anybody agree with that?” he asked.

Parking Commissioner David Leonard did.

“I don’t know if we can sacrifice those assets under any conditions,” he said. “I don’t see how we ever get to the point where a sale of the parking facilities is a good thing.”

But 3rd Ward City Commissioner Elias Lumpkins, also a parking commissioner, said he wasn’t ready to reach that conclusion yet. Lumpkins said he wants to see some financial data on what a long-term lease would mean for the city, and he also wants to hear what the public has to say about a sale.

“I’m not there yet. I’m not ready to say don’t sell and cut the process off,” he said.

Lumpkins added that he favors going to a bid process for the properties, if a decision is made to sell the facilities.

Third Coast has offered the city from $35 million to $45 million for 10 lots and four ramps downtown. But Third Coast principals David Levitt and Brad Rosely have said they are willing to negotiate a sales price with the city and also talk about a long-term lease of the properties.

Levitt and Rosely see their offer as a way the city can dig itself out of the financial hole its general fund is in. City Manager Kurt Kimball, though, told commissioners not to consider the Third Coast offer during the current budget sessions. So commissioners asked the Parking Commission to figure out how much parking revenue could go into the general fund to fill some of the gap.

Parking Commission Chairman Jack Hoffman felt the revenue Parking Services gets from parking violations could be transferred to the city. Parking Services Director Pam Ritsema said gross revenue from those fines totals $1 million a year. After collection expenses, however, she said her department is only left with a net of $300,000.

Parking services would still have a surplus if it gave up the parking-ticket revenue. But Ritsema said it would take longer for her department to expand the system and make major repairs without those dollars.

Selling advertising in the ramps and at the lots could be another potential revenue source. The department doesn’t do that now, so any income from ad sales would be new revenue.

Parking commissioners did decide not to hire an outside consultant to help with the decisions they have to make and not to hold a public hearing on what they should do.

“If we feel we have sufficient information, we can make a confident recommendation to the City Commission,” said Hoffman. “We have to draw a line somewhere or this could go on forever and become very costly.”    

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