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Harrisburg's mayor calls for closer look at parking system

Written by Emily Previti/Keystone Crossroads | Oct 22, 2015 4:30 AM
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Photo by kev72/flickr

(Harrisburg) -- Parking isn't making enough money for the city of Harrisburg, and the state and its private partners. 

It's unclear why, though.

Harrisburg Mayor Eric Papenfuse says expectations are unrealistic to begin with.

Papenfuse has said the city's billion-dollar deal was preferable to bankruptcy.

But overzealous projections for parking and other city revenue sources in the city's Act 47 plan likely will force Harrisburg officials to balance the budget some other way, Papenfuse says.

Property taxes are not among the options he is considering, his spokeswoman Joyce Davis says.

"The numbers were inflated to make the Strong Plan work," Papenfuse said, referring to the Act 47 plan by the moniker used by the consultants who created it. "Are we going to hold anyone accountable?"

Papenfuse spoke during a meeting of the Pennsylvania Economic Development Financing Authority. PEDFA was the vehicle for the state's $287 million bond issue that financed the parking lease.

He alleges consultants exaggerated estimates tied to the borrowing- which helped Harrisburg get out of debt - but didn't speculate about why that happened.

Financial advisers and state officials scrambled to close the deal before the end of 2013, citing concerns that interest rates would rise. The plan's main architects also knew their pay was tied to a deadline for reconciling the city's half-billion-plus of debt - but their contracts gave them until the end of 2014.

At the time, projections showed parking revenue would have to rise 60 percent to cover all costs. By all, we mean operating costs, maintenance money, operator performance bonuses, city taxes and profit-share, and repayments on the bonds.

Trimont Real Estate Director John Gass won't say whether the estimates seem realistic. But Gass, whose company is the parent of the state's private partner PK Harris, notes the projections were based on the planned doubling of parking fines and switch to private enforcement from historically lax city ticketing.

Both happened.

But a backlog of thousands of tickets developed.

Something was overlooked in the deluge of ordinances related to the Harrisburg deal passed through City Council two years ago. That is, completing all legal processes required for SP Plus Municipal Services to write tickets directly through the court system.

SP Plus discovered the issue a few months after taking over. Gass says it took another six to get requisite ordinances through the city's law department and legislative body. He now says the best hope is to get payment for half of outstanding tickets from 2014; the statute of limitations has run for the rest, as per a judge's ruling.

Gass says operator parent Standard Parking typically writes tickets through the municipality. Harrisburg was removed from that process, a decision Gass says he can't explain.

But Harrisburg's Act 47 plan cut City Hall out of cashflow processes linked to other operations, such as sewer system billing and administration. In that case, the decision stemmed from concerns that the city's historic mismanagement would, even with a new administration and clean financial slate, be slow to improve with such a tight budget and new, thin staff.

If the court snafu hadn't happened, parking would have generated another estimated $585,000 last year, according to Keystone Crossroads and consultant's analysis.

That's not enough to make up the shortfall in enforcement revenue.

An audit of system performance discussed Wednesday didn't evaluate projections. It left some other questions answered, too.

Mary Soderburg, who sits on the PEDFA board, says she wants an analysis of whether more people are coming into the city and parking.

 

Published in Harrisburg, News

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