Officials confirm cap on Cincinnati parking rates can be circumvented in new parking proposal

CINCINNATI - When a deal to turn Cincinnati parking over to the Port Authority was announced earlier in the week, one point stressed was that rates couldn’t increase above a set maximum amount.

But city officials confirmed Thursday there is a way around the cap.

An advisory board that would oversee the city’s parking system if City Council turns its operation over to the Port Authority could increase rates above the maximum amount publicized, city officials acknowledged.

The board could only do so, however, under limited circumstances that require multiple layers of approval, officials added.

Critics of the plan dislike that the board could potentially raise parking rates higher than a 3 percent annual cap, calling it a major loophole.

City Manager Milton Dohoney Jr. unveiled a proposal Tuesday to lease the system to the Port Authority. The lease would last for 30 years for metered parking, and up to 50 years for city-owned garages and lots.

In return, the city would get $92 million in an upfront payment, along with annual payments of $3 million that would gradually increase over time.

“Parking is not a core city function,” Dohoney said, adding the money could be used to jumpstart various development projects in downtown and around the city.

One of the plan’s key aspects is it retains a measure of public control, Dohoney said. Also, it would limit rate hikes to either 3 percent annually or the Consumer Price Index, whichever is higher.

An advisory board would be created to make recommendations on rates and hours of operation. Details of the board’s makeup and powers, however, weren’t released publicly.

WCPO Digital has learned it would be possible to circumvent the rate increase cap under a complicated process.

The advisory board would be composed of five members, said city spokeswoman Meg Olberding. The Port Authority’s board of directors would appoint four members, and the city manager would appoint one member.

The parking advisory board would need a majority vote for issues involving day-to-day operations, and a unanimous vote for issues involving raising rates or changing hours beyond what is included in the agreement.

Even with the unanimous vote, any recommended rate increase must still go to the city manager for approval and -- if the manager OKs it -- then the Port Authority board would vote on it.

City administrators said it provides protection for residents because it requires three layers of review and approval. The structure is similar to existing groups like the Urban Design Review Board and the Planning Commission, which make recommendations to the city manager, Olberding said.

“We have dozens of these groups in the city,” Olberding said. “It’s a good way to get citizen involvement in the decision-making process.”

Vice Mayor Roxanne Qualls emphasized the arrangement isn’t unusual.

“Throughout city government, we have boards and commissions comprised of unelected citizens who are responsible for overseeing city operations and approving changes in operations,” said Qualls, who is running for mayor in this fall’s election.

“Three notable examples are the Park Board, the Recreation Commission, and the Health Commission --mayor appoints, City Council approves,” Qualls said. “Externally, there are numerous boards comprised of unelected individuals appointed by the mayor and approved by City Council who oversee taxpayer dollars and are responsible for overseeing operations. SORTA and the Port Authority come to mind.”

Opponents of the parking deal remain skeptical.

“The city has misled the public on several elements of this proposal, the fee structure being just one of many,” said John Cranley, an ex-city councilman who also is running for mayor.

“The city said publicly that it would control the rates, but this is not true. Right now, rates are completely controlled by City Council, which they can keep the same, increase, or most importantly, decrease,” he said.

Plan supporters dispute this point, noting the city manager currently decides on rate increases, not City Council.

Opponents counter the manager is hired and fired by the mayor, with the consent of council, providing some public oversight.

If the deal is approved, the Port Authority will issue bonds backed by Guggenheim Partners, a New York-based investment bank.

The deal is attractive for the Port because it will get a lower interest rate than otherwise. Also, Guggenheim can write off its interest as a tax deduction over the term of the agreement.

Councilman P.G. Sittenfield isn’t convinced the deal is in the public’s best interest.

“The bottom line is this: A $170 billion New York City investment bank is going to get its $92 million investment back -- and then some,” Sittenfield said.

“Right now, the public is only being given the rosiest of pictures,” he said. “But if for a variety of reasons current projections are not meant, you can bet this advisory board is going to push through a more dramatic expansion of enforcement hours and additional rate increases.”

Plan supporters

said those concerns are overstated. The $92 million in upfront money will help fast track several projects including a planned interchange at Interstate 71 and Martin Luther King Drive, and redeveloping Tower Place Mall and the old Pogue’s garage at Fourth and Race streets downtown.

“It enables the city to do major economic development projects to help us thrive and grow and raise new revenues to prevent budget deficits in the future,” said Councilwoman Laure Quinlivan.

“(And) it ensures that for the next two years, we will avoid major layoffs of police and firefighters that would otherwise be necessary,” she added.

The advisory board would help ensure parking decisions are made fairly, Qualls said.

“These boards and commissions are in place to ensure that operational decisions, delivery of services and contracts are shielded from undue political influence by lawyer/lobbyists and the special interests they represent,” Qualls said.

For Cranley, the benefits don’t outweigh the risks to the public.

“This is a horrible idea that takes away power from the people and is anti-democratic,” he said.

The city owns seven garages and lots, and has 4,978 parking meters.

 

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