When few Chicago residents were paying attention, back on Dec. 4 City Council aldermen voted 40 to 5 in favor of a deal that gives Morgan Stanley a 75-year lease on Chicago parking meter revenue. Get ready for a shock: Rate hikes go into effect, appropriately enough, on Friday the 13th and will be phased in at more than 36,000 meters in the next few weeks.
Yes, that Morgan Stanley. The same Wall Street investment banking firm getting hauled in front of Rep. Barney Frank & Co. along with other Wall Street titans blamed for the subprime mortgage and credit clusterf*&k that led to the bank bailout that led to extra bonuses for Gotham’s greediest.
The Trib reported the news in a straightforward way, but didn’t cite Morgan Stanley by name, instead referring to our new Parking Czar as “a new private operator.”
A blogger in the Huffington Post got it right.
The Loop gets hit first on Friday.
From the Trib piece:
The increases are part of a 75-year lease that city leaders recently approved with a new private operator. Under the agreement, the city receives an up-front payment of $1.15 billion from the company that will now collect payments from the meters.
The lease allows the private operator to raise rates in the coming years. The timetable for the initial increases:
*Loop: $3.50 an hour starting Friday.
*Near North, Near West and Near South: $2 an hour starting Saturday.
*Lincoln Park: $1 an hour Feb. 18-19.
*North Side: $1 an hour Feb. 20-28.
*West Side: $1 an hour March 1-2.
*South Side: $1 an hour March 5-9.
The $1-an-hour charges will mean a quadrupling of the cost to park at two-thirds of the meters in the city, where the current rate of 25 cents an hour has not changed in decades.
Although the meters have generated almost $20 million a year in net income for the city, Daley has hailed the privatization payout and similar leases of public assets as innovative thinking that will allow the city to continue to invest in vital public works projects today.
In the statement announcing the implementation of the rate hikes, Daley chief of staff Paul Volpe said the lease “is another part of the mayor’s ongoing commitment to protect taxpayers from a tax increase.”
Someone ID’d as “Chicago Bred” responded with this comment on the Trib website:
Now is the time to utilize and expand carsharing-IGO comes to mind. It’s scary to think about 75 years of more money to a private company for an upfront payout which is probably already spent.
And the comments get a lot more incendiary than that:
How obscene is it that Morgan Stanley now rakes in our inflated meter rates? This is one of the banks that gouged and took advantage of homebuyers that led to the financial crisis and then received big bucks from the bailout. How did this agreement ever come together in the first place? I haven’t seen much scrutiny of the details of this. And now while we’re digging deep into our pockets just to pick up some milk at the corner store, it’s those small struggling business people (who will never receive a govt. bailout) who will suffer from the loss of business. Patrick Fitzgerald, are looking at this one?
Sold the streets/parking meters to a private company with less three days notice to the alderman to review it for 1.1 billion. I’m not a math wiz but amortization should bring that to well over 6 billion dollars for the new owners.
What’s interesting is that I went to city hall the day that Daley was announcing his proposal for budget cuts and he said that one way to save money was to stop going through contractors and private companies for certain city services, like security. It doesn’t make sense to lease something for 75 years to someone else when the city can pocket the money. Who knows with inflation if the deal will even be worth it in 75 years?
As a resident of the loop, these meter hikes affect me directly. Up until now, the meters around my building did not need to be fed on evenings, Sundays, and holidays. Friends and family loved to visit me because they could find parking on these off-hours. This, of course, is no longer the case. Time for me to move to a different neighborhood.
Why Chicago needed to sell the streets (75 year lease to me spells “sold”) to get extra money is beyond me. Seems like they should have been able to find a way to increase the rates themselves. What drove Chicago to SELLING and handing over control and how did the council win the vote on this?!?!?
Are we seriously supposed to scrounge around for change to feed the meter on Christmas Day and Thanksgiving??? Have they no decency?
Guys, the best way to describe the privatization is that we’re taking a mortgage on our parking meters. Daily knows he can make more money for the city in the long run by raising rates and keeping the control in the city’s hands. But he also knows that he has a huge ($20million) budget shortfall this year and he can’t keep the machine running without taking out a loan! He’s brining the extra money forward with the privatization.
First the ubiquitous cameras recording our license plates, now this. Who do our streets belong to anyway? Apparently, not the citizens of Chicago.
Car sharing can be part of the solution. But while I-GO does maintain reserved parking spaces that its members don’t pay for, we (and Zipcar, for that matter, too) can’t do anything about our hijacked and pawned-off parking meters.
Better start stocking up on those quarters. Although I’m feeling more drawn and quartered right now.