On March 5, Mayor Rahm Emanuel issued a press release boasting that motorists in Chicago had saved millions of dollars in parking meter fees thanks to the deal he renegotiated last year with the company that owns the meters.
“By delivering on free Sunday parking in the neighborhoods,” Emanuel said in a statement, “we’re able to make a bad deal better.”
It sounded great—who doesn’t want to send less of our money to the wealthy investors who control the meters?
But a report attached to the press release—prepared by Navigant, a consultant to the city—doesn’t prove anything of the sort. It’s the latest example of Emanuel claiming he improved the unpopular deal—though he actually may have made it worse.
In case you’ve tried to forget, it was December 2008 when the City Council, at the urging of former mayor Richard M. Daley, voted to lease the city’s 36,000 parking meters to Chicago Parking Meters Inc., a consortium of investors led by Morgan Stanley.
The best way to think of the deal is as a loan. The consortium agreed to lend the city, struggling with unpaid bills, about $1.2 billion. In exchange the city agreed to pay back the consortium with 75 years of revenues from those meters.
Not surprisingly, the deal was unpopular with the public, if for no other reason than that the council also gave CPM permission to jack up the parking rates from 25 cents an hour to $2 an hour in most of the city, and to as much as $6.50 an hour downtown.
Clearly, it was a boon for CPM. In 2008 the city collected $23.8 million from the meters. Four years later CPM raked in $139.5 million, according to audited reports filed with the city. The company’s analysts expect revenues to increase yearly to almost $162 million by 2020.
It adds up to a double whammy for Chicagoans. Not only are drivers paying more to park, they’re forking it over to CPM instead of providing the money for basic city services—like filling potholes. (The city spent most of the proceeds of the meter sell-off to plug budget holes during Daley’s last couple years in office.)
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