Pittsburgh City Council has reached a deal that it feels will keep the City’s pension program from being taken over by the state while at the same time not issuing any new debt or leasing any city assets. The plan calls for an increase in parking rates at garages and meters and then promises that increased revenue over the next 30 years to the pension fund. City Controller Michael Lamb says he has spoken to the Executive Director of the Pennsylvania Public Employee Retirement Commission and has received approval for the plan. PERC is the body required by law to set the value of all municipal pension funds. If the PERC sets a value of the Pittsburgh Pension Plan below the 50% funded level the state will force a takeover of the pension fund, if it exceeds the 50% mark, Pittsburgh will be allowed to continue to manage its own fund.
Lamb estimates the higher rates would generate about $880 million dollars over the next 30 years and he says it should have a present-day value of more than $220 million. That is roughly the amount needed by the end of the year to bring the pension fund up to the 50% level. Controller Michael Lamb is to meet with a representative of the public employee retirement commission later today to come up with an exact value that can be added into the pension fund.
The plan needs the support of Mayor Luke Ravenstahl and the Pittsburgh Parking Authority. Mayor Ravenstahl has not yet taken a stance on the bill. Mayoral spokesperson Joanna Doven says, "The Mayor today will be meeting with legal and financial experts with the City and the Parking Authority to discuss the viability of the plan. After all facts are discovered, the Mayor will comment further."
The Mayor has appointed all of the members of the Parking Authority Board. Councilwoman Natalia Rudiak is a member of the Authority Board and says the package of bills includes a payment plan that gives the Authority enough money to do its job.
Council members stress that the rate increase that will be phased in over the next several years are much lower than the rate increases that would have been seen if the city would have leased the parking assets as had been proposed by Mayor Ravenstahl.
Councilman Bill Peduto says this is a much better deal than issuing a bond or leasing assets. “There is nobody who is making money off of it, there is no interest to be paid, this is the least expensive plan for the people of Pittsburgh,” says Peduto. The councilman estimates that the city would have had to pay $500-600 million in interest under the Council/Controller plan and would have allowed the leasing company to take $2.4 billion out of the city under the Mayor's.
Showing posts with label Parking Authority. Show all posts
Showing posts with label Parking Authority. Show all posts
Tuesday, December 28, 2010
Wednesday, December 15, 2010
Pension/Parking Plan Dies Again
Pittsburgh City Council has once again rejected a plan to lease parking assets to LAZ Parking. Councilman Ricky Burges gathered only two yes votes for his compromise plan at a meeting Wednesday.
Mayor Luke Ravenstahl had hoped to lease the garages and meters for 50 years and then use the upfront proceeds to bring the city’s pension plan up to the 50% funded level in order to avoid a state takeover. Council members rejected the deal and then moved a proposal to do a garage swap and bond issuance with the Parking Authority to shore up the pension fund. Still others on the council think a state take over may be the best option.
The Burgess plan shortened the length of the lease from 50 to 40 years, lowered the fee increase schedule for parking meters in neighborhoods, included revenue sharing and allowed the city to benefit from advertising on and in the garages. He feels his plan addressed all of the concerns voiced by the community and by council members. He says he is willing to work up to the last minute to find a solution. Councilwoman Theresa Smith says council should not leave the building until it finds a way to fix the pension problem.
Councilman Bruce Kraus says any lease deal will continue to fail to get five votes because there are at least five council members who will not allow the city to sell or lease any public assets. “So if we are truly interested in resolving our pension issue… Stop it. Nobody wants it. Can we stop it now and start doing what we need to do to resolve our pension problem,” says Kraus. Councilman Bill Peduto says he will not give up control of one of the few revenue streams available to the city he likened it to “selling the cow rather than the milk.” He says cities across the nation are finding “wall street firms” swooping in to pickup assets. “Do you think they are doing this to help cities pension plans and to help cities get through tough budget times? Then you think that check cashing places are out there to help poor people,” says Peduto
The revised lease fell on a 5-2 vote with two abstentions. LAZ Parking CEO Alan Lazowski says he is not ready to walk away from the deal and promised to meet with any council member to get a deal done before the end of the year. “We have spent millions of dollars in pursuit of this deal, we have thousands of man hours in this deal,” says Lazowski, “We owe it to our company, to our 6,000 employees, we owe it to the infrastructure world that is looking at this deal to say this is important for cities across the country.”
Lazowski says he feels his firm has been very responsive to every suggestion made by council members and he reminds them that he was only responding to a Request For Proposal from the Mayor’s office when he first tried to lease the parking assets.
Council members Smith, Dowd and Burgess says they will work to find a way to prevent a state take over of the pension plan but all three know time is running out to meet the December 31st deadline.
Mayor Luke Ravenstahl had hoped to lease the garages and meters for 50 years and then use the upfront proceeds to bring the city’s pension plan up to the 50% funded level in order to avoid a state takeover. Council members rejected the deal and then moved a proposal to do a garage swap and bond issuance with the Parking Authority to shore up the pension fund. Still others on the council think a state take over may be the best option.
The Burgess plan shortened the length of the lease from 50 to 40 years, lowered the fee increase schedule for parking meters in neighborhoods, included revenue sharing and allowed the city to benefit from advertising on and in the garages. He feels his plan addressed all of the concerns voiced by the community and by council members. He says he is willing to work up to the last minute to find a solution. Councilwoman Theresa Smith says council should not leave the building until it finds a way to fix the pension problem.
Councilman Bruce Kraus says any lease deal will continue to fail to get five votes because there are at least five council members who will not allow the city to sell or lease any public assets. “So if we are truly interested in resolving our pension issue… Stop it. Nobody wants it. Can we stop it now and start doing what we need to do to resolve our pension problem,” says Kraus. Councilman Bill Peduto says he will not give up control of one of the few revenue streams available to the city he likened it to “selling the cow rather than the milk.” He says cities across the nation are finding “wall street firms” swooping in to pickup assets. “Do you think they are doing this to help cities pension plans and to help cities get through tough budget times? Then you think that check cashing places are out there to help poor people,” says Peduto
The revised lease fell on a 5-2 vote with two abstentions. LAZ Parking CEO Alan Lazowski says he is not ready to walk away from the deal and promised to meet with any council member to get a deal done before the end of the year. “We have spent millions of dollars in pursuit of this deal, we have thousands of man hours in this deal,” says Lazowski, “We owe it to our company, to our 6,000 employees, we owe it to the infrastructure world that is looking at this deal to say this is important for cities across the country.”
Lazowski says he feels his firm has been very responsive to every suggestion made by council members and he reminds them that he was only responding to a Request For Proposal from the Mayor’s office when he first tried to lease the parking assets.
Council members Smith, Dowd and Burgess says they will work to find a way to prevent a state take over of the pension plan but all three know time is running out to meet the December 31st deadline.
Parking Availability In Real-Time Mobile App
Parking in Downtown’s Cultural District just got a lot easier with the option to get online, make a phone call, or check an app to check parking availability.
Introduced and implemented at noon today, ParkPGH will deliver parking vacancies in all Cultural District garages in real-time. Funded by the Benter Foundation, the free smartphone application that works on iPhones, Blackberry and Android phones uses updates from each garage in the district to tell drivers the parking availability of 25 percent of the garages downtown.
"ParkPGH connects to a central database and to the gates at each location and updates every thirty seconds to provide real-time parking availability to the Cultural District," project engineer Mark Fleming says.
Fleming made sure that ParkPGH is also available to those who don’t have the smartphone app. It can be accessed through the web, through texting PARKING or calling 412-423-8980 through which users will receive an automated response.
According to Kevin McMahon, President of the Cultural Trust, and Bill Benter who funded the project, the program was made to reduce the hassle of finding a space, and hopefully draw more people for not only performances, but also impromptu visits.
"I believe [searching for a space] is an impediment to people coming in and enjoying the wonderful things we have going on in the Cultural Trust so this is an attempt to make that easier for everyone," Benter says.
According to developers, the first trial will be assessed before citywide expansion is implemented and that evaluation should be completed by March.
"Over time it's possible that this could expand to all parking, whether it would work for metered parking, who knows? With some of the great things that technology is doing, down the road it's possible," McMahon says.
Introduced and implemented at noon today, ParkPGH will deliver parking vacancies in all Cultural District garages in real-time. Funded by the Benter Foundation, the free smartphone application that works on iPhones, Blackberry and Android phones uses updates from each garage in the district to tell drivers the parking availability of 25 percent of the garages downtown.
"ParkPGH connects to a central database and to the gates at each location and updates every thirty seconds to provide real-time parking availability to the Cultural District," project engineer Mark Fleming says.
Fleming made sure that ParkPGH is also available to those who don’t have the smartphone app. It can be accessed through the web, through texting PARKING or calling 412-423-8980 through which users will receive an automated response.
According to Kevin McMahon, President of the Cultural Trust, and Bill Benter who funded the project, the program was made to reduce the hassle of finding a space, and hopefully draw more people for not only performances, but also impromptu visits.
"I believe [searching for a space] is an impediment to people coming in and enjoying the wonderful things we have going on in the Cultural Trust so this is an attempt to make that easier for everyone," Benter says.
According to developers, the first trial will be assessed before citywide expansion is implemented and that evaluation should be completed by March.
"Over time it's possible that this could expand to all parking, whether it would work for metered parking, who knows? With some of the great things that technology is doing, down the road it's possible," McMahon says.
Monday, November 15, 2010
ICA Rejects Budget
The Pittsburgh Intergovernmental Cooperation Authority (ICA) held a public meeting to address the city's revised proposed 2011 budget and five year plan today. The ICA was created in 2004 by the state to help financially stabilize the city. The Authority rejected the mayor's second draft of a proposed budget. ICA Chair Barbara McNees says their concerns are that it "does not meet the requirements that we've required every year since we've been here for balanced, verifiable revenue." Specifically, the budget lacked the $60 million needed to help fund the city's pension. The mayor has until the end of the month to resubmit a budget and then the ICA has another 15 days to review it. McNees says the ICA has concerns about the potential takeover of the city's pension fund by the Pennsylvania Municipal Retirement System, which would require payments of more than $100 million a year to pay for the plan. McNees says "fiscal chaos is what could happen if you have to come up with $120 million in the out-years." In September the mayor put forth a $447.4 million budget that included revenue from leasing the city's parking garages and meters to a private operator. But the ICA rejected the proposal when it became clear city council would not approve the lease. In turn, the mayor rejected council's proposal to sell the parking assets to the Parking Authority to help build up the pension fund. The pension is only 27.5% funded. The ICA must approve a budget before council can vote on it.
Tuesday, November 9, 2010
Council Asks Mayor to Negotiate With Parking Authority
Pittsburgh City Council has given preliminary approval to a bill that would ask the Mayor to negotiate with the Pittsburgh Parking Authority to purchase one garage, a few surface lots and a long list of parking meters. The bill passed 8-1 with Councilman Ricky Burgess voting no.
The measure began as a bill moved by Councilwoman Theresa Smith asking the mayor to enter negotiations to reach a modified deal to lease the parking assets owned by the Parking Authority to a private company.
During debate, it quickly became clear that very few council members were willing to approve any lease deal and councilman Patrick Dowd started to suggest that they should gut the bill and fill it with amendments. Burgess argued that the bill did nothing more than to put more options on the table. Councilman Daniel Lavelle agreed, “What this legislation did was allow myself and others to have the conversation… it’s allowed me to have it with my colleagues, it’s allowed me to have it with the administration yesterday. That’s what this legislation did.” Lavelle has suggested that the city may want to lease the garages but hold on to the meters to have more control over the rates that were of most interest to local business owners and residents.
City Council President Darleen Harris says it is time to move on from the idea of leasing any of the parking assets. “We talk about fairies. From Peter Pan, J. M. Barrie says ‘you can have anything in life if you are willing to sacrifice everything else for it’ and I’m not willing to sacrifice this city,” says Harris. Councilwoman Smith shot back that she does not work in fairy tales, she works in reality and in reality the public wants a solution.
City Council President Darleen Harris is also concerned that the city would be opening the door to a lawsuit if it started to negotiate with just one party. She says she has gotten calls and letters from parking companies that have asked the city to put out a new RFP if the terms of the deal are to be changed. The mayor says he thinks they can make the changes without having to open the lease to new bids.
Councilman Dowd eventually offered amendments that changed the bill from requesting negotiations on a new lease deal to asking the mayor to work with the Parking Authority to sell the assets and use the proceeds to shore up the pension plan.
The re-written bill quickly passed and will come up for a vote Tuesday.
The measure began as a bill moved by Councilwoman Theresa Smith asking the mayor to enter negotiations to reach a modified deal to lease the parking assets owned by the Parking Authority to a private company.
During debate, it quickly became clear that very few council members were willing to approve any lease deal and councilman Patrick Dowd started to suggest that they should gut the bill and fill it with amendments. Burgess argued that the bill did nothing more than to put more options on the table. Councilman Daniel Lavelle agreed, “What this legislation did was allow myself and others to have the conversation… it’s allowed me to have it with my colleagues, it’s allowed me to have it with the administration yesterday. That’s what this legislation did.” Lavelle has suggested that the city may want to lease the garages but hold on to the meters to have more control over the rates that were of most interest to local business owners and residents.
City Council President Darleen Harris says it is time to move on from the idea of leasing any of the parking assets. “We talk about fairies. From Peter Pan, J. M. Barrie says ‘you can have anything in life if you are willing to sacrifice everything else for it’ and I’m not willing to sacrifice this city,” says Harris. Councilwoman Smith shot back that she does not work in fairy tales, she works in reality and in reality the public wants a solution.
City Council President Darleen Harris is also concerned that the city would be opening the door to a lawsuit if it started to negotiate with just one party. She says she has gotten calls and letters from parking companies that have asked the city to put out a new RFP if the terms of the deal are to be changed. The mayor says he thinks they can make the changes without having to open the lease to new bids.
Councilman Dowd eventually offered amendments that changed the bill from requesting negotiations on a new lease deal to asking the mayor to work with the Parking Authority to sell the assets and use the proceeds to shore up the pension plan.
The re-written bill quickly passed and will come up for a vote Tuesday.
Thursday, October 7, 2010
Council Issues Subpoena to Mayor
As Pittsburgh City Council continues its debate over how to best use parking assets to shore up the city’s flagging pension fund, it has issued a subpoena to Mayor Luke Ravenstahl to turn over pension fund data by noon Friday. Council President Darlene Harris says the subpoena asks for the data to be sent to the state rather than to her office. Harris says the Pennsylvania Municipal Retirement System requested the data in 2009 and never received it. Council members contacted the fund asking for the data and Secretary James Allen informed them that the numbers were never produced. The subpoena asks for the names of everyone in the city pension fund and demographic data about them including monthly payments, age and sex. Harris says council members are exploring exactly what it would mean to the city if the state took over the city-run fund. The mayor’s office has said that it would be forced to increase payments by more than 25 million dollars a year under a state take over. Council hopes the state will use the data to come up with an exact number of how much it will be required to pay into the system on an annual basis if there is a takeover. Currently the city’s pension program is less than 30% funded and the state has said if that number does not hit 50% by the end of the year it will take control of the fund.
Mayor Ravenstahl has said that if there is a state takeover it would mean annual city payments to the pension fund would increase by as much as $27 million, resulting in budget cuts and/or tax hikes.
Councilman Bill Peduto says neither Council nor the Pennsylvania Municipal Retirement System knows where the mayor got the $27 million figure. Peduto says they need the subpoenaed information so as to determine an accurate figure. Peduto added that it wouldn't be a state takeover but rather the city's pension fund would be managed by the Retirement System which already manages 900 other pension funds.
Council has given itself till the end of the month to come up with alternatives to the mayor’s plan to lease the parking assets for the next 50 years to J.P. Morgan Asset Management and Connecticut-based LAZ Parking, for more than $450 million. Harris says the tight time line forced council to go the route of a subpoena rather than relying on a letter to the mayor’s office. However, Harris says she also sent a more friendly request directly to the mayor’s office.
Mayor Ravenstahl has said that if there is a state takeover it would mean annual city payments to the pension fund would increase by as much as $27 million, resulting in budget cuts and/or tax hikes.
Councilman Bill Peduto says neither Council nor the Pennsylvania Municipal Retirement System knows where the mayor got the $27 million figure. Peduto says they need the subpoenaed information so as to determine an accurate figure. Peduto added that it wouldn't be a state takeover but rather the city's pension fund would be managed by the Retirement System which already manages 900 other pension funds.
Council has given itself till the end of the month to come up with alternatives to the mayor’s plan to lease the parking assets for the next 50 years to J.P. Morgan Asset Management and Connecticut-based LAZ Parking, for more than $450 million. Harris says the tight time line forced council to go the route of a subpoena rather than relying on a letter to the mayor’s office. However, Harris says she also sent a more friendly request directly to the mayor’s office.
Saturday, September 25, 2010
Evaluation of Parking Assets
A $250,000 study commissioned by Pittsburgh Council suggests that the city's parking garages and meters would likely bring in $2.4 billion over the next 50 years. Council, is looking for alternatives to Mayor Luke Ravenstahl's plan to lease the garages and meters for 50 years. The mayor this week unveiled the high bid...$452 million in an upfront payment.
The mayor wants to use $200 million from that payment to bolster the city's sagging pension fund which is at about 28% of the $989 million obligation to workers and retirees. The state has threatened to takeover the pension, meaning higher annual payments by the city, unless the fund is at a minimum of 50% of the obligation by January.
Jeff Andrien, president of Finance Scholars Group which did the study for Council, says the cash value of the city's parking assets depends on how much demand will drop as parking prices increase. Andrien says the total value of the parking assets was put at $401 million. The study did not make any recommendations on whether the city should lease the garages, float a bond to fund the pensions and use parking revenues to pay off the loan, or let the state take over the pension fund.
The mayor wants Council to approve his lease plan by November 1.
The mayor wants to use $200 million from that payment to bolster the city's sagging pension fund which is at about 28% of the $989 million obligation to workers and retirees. The state has threatened to takeover the pension, meaning higher annual payments by the city, unless the fund is at a minimum of 50% of the obligation by January.
Jeff Andrien, president of Finance Scholars Group which did the study for Council, says the cash value of the city's parking assets depends on how much demand will drop as parking prices increase. Andrien says the total value of the parking assets was put at $401 million. The study did not make any recommendations on whether the city should lease the garages, float a bond to fund the pensions and use parking revenues to pay off the loan, or let the state take over the pension fund.
The mayor wants Council to approve his lease plan by November 1.
Wednesday, August 11, 2010
Mayor Wants Bids For Parking Lease By September 15
Pittsburgh Mayor Luke Ravenstahl has released a final request for proposals (RFP) to 7 pre-qualified investors to lease city parking garages and meters for 50 years. The mayor is hoping that a lease agreement will bring a minimum of $300 million upfront....$200 million to bring the pension fund up to 50% of its $967 million liability, and $100 million to pay down the City Parking Authority debt. Ravenstahl said adjustments were made to the original RFP following 3 neighborhood meetings...
“We have addressed the concerns of residents, small business owners and council members as best as we could while still ensuring that the upfront value is generated to protect those same constituents from drastic tax increases, service cuts, or a combination of both. Unfortunately, we have inherited this serious problem and are now forced into a situation where doing nothing is not an option. This solution is the best solution for our City.”
Unless the city funds the pension obligation by at least 50% by January, the state has threatened a takeover and would require the city to increase annual payments to the pension fund by $30 million.
Councilman Patrick Dowd says the mayor is just making minor adjustments and is sticking with his plan to privatize public assets(garages and meters)....
"Controller Michael Lamb, Council President Darlene Harris and I have been very patient..allowing the mayor to put this out to bid and see what kind of number he can catch. For the sake of the city, we're hoping he gets a great number, but we're skeptical and concerned, and think there are other ways to accomplish the same goals."
Some of the adjustments involve enforcement. Currently parking meters are not enforced on Sundays. The mayor's original proposal would have allowed enforcement after 1 p.m. on Sundays. There would be no Sunday enforcement under this final plan. Under the original plan, all city meters would have been enforced until 10 p.m. Monday through Saturday. The revised plan halts meter enforcement at 6 p.m. in Allentown, Beechview, Carrick, East Liberty, Lawrenceville and the West End.
There have been concerns about huge jumps in parking meter rates. The original plan would have allowed rates in Carrick to rise from the current 50 cents an hour to $1 by 2014. The final plan freezes the 50 cents an hour rate for 5 years because of competition from neighboring suburban business districts. The 50 cents an hour rate in Bloomfield, which will lose hundreds of jobs at West Penn Hospital will remain till January 2012 and then would increase to $1.50 an hour by 2014.
The revised plan also calls for the city to share advertising revenue with the contractor. Councilman Dowd called that a small concession because it's hard to predict what advertising revenues would be available over the next 50 years.
The mayor said the city had to make some concessions to get these adjustments....
"we also had to compromise on other changes to ensure that we receive an upfront value that is significant enough to shore up our pension fund and save our residents from the ramifications of a state takeover.”
Those concessions include expanding the non-compete zone into an area that extends further into the Golden Triangle that discourages the building of new parking garages by the city or the Parking Authority.
The deadline for the bids is September 15 and the mayor wants council to approve the legislation by October 1. Councilman Dowd says the mayor is constricting the process..."This is a decision that will affect the city for 50 years...we should spend more than 2 or 3 weeks debating it."
“We have addressed the concerns of residents, small business owners and council members as best as we could while still ensuring that the upfront value is generated to protect those same constituents from drastic tax increases, service cuts, or a combination of both. Unfortunately, we have inherited this serious problem and are now forced into a situation where doing nothing is not an option. This solution is the best solution for our City.”
Unless the city funds the pension obligation by at least 50% by January, the state has threatened a takeover and would require the city to increase annual payments to the pension fund by $30 million.
Councilman Patrick Dowd says the mayor is just making minor adjustments and is sticking with his plan to privatize public assets(garages and meters)....
"Controller Michael Lamb, Council President Darlene Harris and I have been very patient..allowing the mayor to put this out to bid and see what kind of number he can catch. For the sake of the city, we're hoping he gets a great number, but we're skeptical and concerned, and think there are other ways to accomplish the same goals."
Some of the adjustments involve enforcement. Currently parking meters are not enforced on Sundays. The mayor's original proposal would have allowed enforcement after 1 p.m. on Sundays. There would be no Sunday enforcement under this final plan. Under the original plan, all city meters would have been enforced until 10 p.m. Monday through Saturday. The revised plan halts meter enforcement at 6 p.m. in Allentown, Beechview, Carrick, East Liberty, Lawrenceville and the West End.
There have been concerns about huge jumps in parking meter rates. The original plan would have allowed rates in Carrick to rise from the current 50 cents an hour to $1 by 2014. The final plan freezes the 50 cents an hour rate for 5 years because of competition from neighboring suburban business districts. The 50 cents an hour rate in Bloomfield, which will lose hundreds of jobs at West Penn Hospital will remain till January 2012 and then would increase to $1.50 an hour by 2014.
The revised plan also calls for the city to share advertising revenue with the contractor. Councilman Dowd called that a small concession because it's hard to predict what advertising revenues would be available over the next 50 years.
The mayor said the city had to make some concessions to get these adjustments....
"we also had to compromise on other changes to ensure that we receive an upfront value that is significant enough to shore up our pension fund and save our residents from the ramifications of a state takeover.”
Those concessions include expanding the non-compete zone into an area that extends further into the Golden Triangle that discourages the building of new parking garages by the city or the Parking Authority.
The deadline for the bids is September 15 and the mayor wants council to approve the legislation by October 1. Councilman Dowd says the mayor is constricting the process..."This is a decision that will affect the city for 50 years...we should spend more than 2 or 3 weeks debating it."
Wednesday, June 30, 2010
Mayor Outlines Parking Lease Plan
Mayor Luke Ravenstahl says chartering Pittsburgh’s parking garages and meters to a private firm is the best way to avoid state takeover of the city’s ailing pension fund.
Today, he released documents outlining the terms of a 50-year lease. The mayor says he wants a down payment of at least $200 million with $15 million more coming in each year thereafter.
Unless the city receives a windfall, all of the lease’s revenue would go toward the pension fund, which is only 30% funded. The pension liability has grown to $990 million and covers benefits for all city employees.
Pennsylvania’s legislature has warned city leaders that unless Pittsburgh funds its pension at least 50% ($495 million) by December 31, the state will take it over. Ravenstahl says that would mean yearly payments of $30 million.
“To illustrate what it means: a property tax increase of 24%, a wage tax increase of 44%, or for reference to the reduction of workforce, what would it mean? It would mean reducing our police force by approximately 400 officers,” says Ravenstahl.
A lease would allow for gradual increases of garage and meter rates. Hourly meter rates downtown and in Oakland would increase by 50 cents each year until 2014, while outlying neighborhoods would see a total increase of just 50 cents. Neighborhood meter rates will increase according to their “tier” – until 2014, when rates will only increase according to the Consumer Price Index.
Ravenstahl says the city will still own the assets, and all Parking Authority employees not retained by the lessee will be offered jobs with the city.
The mayor says once bids for the parking assets come in, City Council will have two months to deliberate: he says a vote is needed by September 15 for the city to have enough time to finalize the deal and put the $200 million in the bank before New Year’s Eve.
Today, he released documents outlining the terms of a 50-year lease. The mayor says he wants a down payment of at least $200 million with $15 million more coming in each year thereafter.
Unless the city receives a windfall, all of the lease’s revenue would go toward the pension fund, which is only 30% funded. The pension liability has grown to $990 million and covers benefits for all city employees.
Pennsylvania’s legislature has warned city leaders that unless Pittsburgh funds its pension at least 50% ($495 million) by December 31, the state will take it over. Ravenstahl says that would mean yearly payments of $30 million.
“To illustrate what it means: a property tax increase of 24%, a wage tax increase of 44%, or for reference to the reduction of workforce, what would it mean? It would mean reducing our police force by approximately 400 officers,” says Ravenstahl.
A lease would allow for gradual increases of garage and meter rates. Hourly meter rates downtown and in Oakland would increase by 50 cents each year until 2014, while outlying neighborhoods would see a total increase of just 50 cents. Neighborhood meter rates will increase according to their “tier” – until 2014, when rates will only increase according to the Consumer Price Index.
Ravenstahl says the city will still own the assets, and all Parking Authority employees not retained by the lessee will be offered jobs with the city.
The mayor says once bids for the parking assets come in, City Council will have two months to deliberate: he says a vote is needed by September 15 for the city to have enough time to finalize the deal and put the $200 million in the bank before New Year’s Eve.
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