Port Authority: We've improved Cincinnati's parking lease

Details on contract with Xerox to come later

CINCINNATI -- A pending contract with a private company to operate Cincinnati’s parking meters, lots and garages has been significantly improved, said the Port of Greater Cincinnati Development Authority Friday.

Details on how the contract with Xerox Corp. has been improved, however, won’t be known for another two to four weeks.

That was the bottom line from a media event staged Friday afternoon by the Port Authority.

The Port Authority signed a long-term lease to operate the city of Cincinnati’s parking system on June 21. But the agency was given 75 days to review the deal and suggest changes before it takes effect.

The deadline falls on Sept. 4.

Most of the negotiations are complete, Port Authority board members announced at the event held at downtown’s Westin Hotel.

"The contract has been negotiated so it is fair, reasonable and transparent," said Tom Williams, a Port Authority board member.

Initially, the lease called for Xerox to be paid 14.6 percent of the parking revenue it will collect from operating Cincinnati’s parking meters. That amount was estimated at about $5.2 million each year.

Some lease opponents alleged that was too high, noting third-party operators in many other cities are paid about 2.3 percent for the same work.

The Port Authority and city administrators countered that Xerox was getting a larger fee because it will make major technological upgrades. They will include making the meters accessible remotely via smartphones.

Still, the draft contract with Xerox has since been changed so it will no longer be paid a fixed fee by the Port Authority.

Lydia Jacobs-Horton, a Port Authority board member who also is a manager at Procter & Gamble, said she called on outsourcing experts to review the contract.

“The Port has created more flexibility in the contract," Jacobs-Horton said, adding the fee will be adjustable year to year.

But she was quick to emphasize the amount paid to Xerox wouldn’t be based on enforcement and how many tickets are issued at meters.

Also, Xerox won’t have electronic connectivity between most of the meters and its officers to notify them immediately when time on a specific meter becomes expired, said Port Authority CEO Laura Brunner. That has been a complaint by motorists in some other cities.

Only about 500 sensors will be used in entire system of 4,900 meters, Brunner added. That means about one in 10 meters will have a sensor.

Instead, the expected increase in parking revenues will come from stricter enforcement. Currently, the city only enforces the meters about 29 percent of the time they’re used.

If the meters were enforced fully, it immediately would equal a $2.8 million jump in annual revenues without increasing rates or expanding hours.

But the Port Authority plans on expanding hours from 6 p.m. to 9 p.m. in downtown and Over-the-Rhine.

Also, it will gradually increase meter rates.

Rates currently are $2 per hour downtown and 25 cents per hour in most neighborhoods. Under the lease, the neighborhood rate would increase to 75 cents per hour this spring.

Planned fee hikes call for the downtown rates to rise gradually to $5 per hour in 30 years, and neighborhood rates to rise to $2 per hour during the same period.

The Port Authority will release the revised contract with Xerox within the next two to four weeks, Brunner said.

Residents will have two weeks to review the document before the Port Authority’s board makes a final decision.

Lease opponents have said the deal would cause rate increases and aggressive enforcement that might drive away customers from small businesses, while also undercutting the city’s long-term financial interests.

The lease has become a central issue in the mayoral race between Vice Mayor Roxanne Qualls and her main challenger, ex-Councilman John Cranley. She supports the deal, while he opposes it.

Both candidates attended Friday’s event, but Qualls quickly left at the end. Cranley stuck around and answered questions from the media.

“It’s hard to say if this made the deal better without more details,” Cranley said. “The public still needs to see the bond term sheet and the operating agreement with Xerox.”

Under the lease, the Port Authority would issue bond debt to pay for improvements and technological upgrades to the parking facilities.

The Port Authority would get annual management fees of about $300,000. Also, Brunner has asked City Council for $27 million of the upfront money.

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