City opts to bring in private sector to modernize downtown parking system

A private management firm was hired by the City Council last night with the hope it can bring efficiencies and technological improvements to the city's downtown parking system.

The firm, Republic Parking Systems, Chattanooga, Tenn., runs parking operations in Rochester, Minn., Lincoln, Neb., and elsewhere across the nation.

The company's five-year contract with the city starts today.

The city will continue to own the parking system and will continue to employ the system's maintenance and meter-enforcement personnel as public city employees.

Republic will receive a $90,000 management fee for the first year of a five-year contract and $80,000 a year for the subsequent four years of the contract.

Republic also will hire seven people, the cost of which will be paid by parking system revenue. The seven will be Republic employees paid at rates established by Republic, City Manager Jim Prosser said on Wednesday.

The positions will consist of a general operations manager, an operations manager, a technical staff employee, an event coordinator and three accounting staff members.

Casey Drew, the city's finance director, estimates that hiring Republic will cost the city only $68,393 more a year than the city had intended to spend on the parking system and parking staff this budget year without private management. The reason the additional amount is not more is, in part, because the city's existing parking operations manager slot is vacant and the city had not yet filled two newly created positions, assistant operations manager and customer services representative, Drew told the council last night.

City Manager Jim Prosser emphasized that no current city parking system employee will lose his or her job with the hiring of Republic. Their status will be reviewed after a year.

Council member Jerry McGrane voted against the parking system change, saying he feared that after one year the city employees could be let go. Prosser said doing so would require a council vote.

Council member Justin Shields also voted against the change, saying he was not satisfied that the union representing parking employees had been adequately apprised of the developments. Drew said employees have participated in the discussions, and Prosser said nothing will change in their union contract.

Doug Neumann, president/CEO of the Downtown District, told the council last night that board members for both the Downtown District and a special downtown taxing district have trouble agreeing on much that relates to downtown parking. But all agree that downtown parking is a problem and all are “eager” to try something new, he told the council.

Earlier in the day, he spoke highly of Republic: “Some of the most vibrant downtowns in the Midwest have enjoyed significant costs savings and have dramatically improved operational excellence when they have switched to Republic Parking.”

Shields said previously that he wasn't interested in laying off city employees so a private company could fill the jobs with lower-paid employees. The new arrangement avoids layoffs.

In the new setup, two of Republic's positions, a technical position and an event coordinator, are designed to address the need to improve the parking system's technology and to increase off-hour parking use, Drew said last night.

Drew said the expectation is that Republic will bring additional revenue to the parking system by better use of the system's capacity and altering the fees at parking meters in high-traffic areas.

For the time being, the city will pay to rent space downtown for the Republic office. Once flood damage is repaired in downtown parkades, Republic is expected to move into office space there, Drew said.

In 2008, the city and the Downtown District had spent time studying the prospect of hiring a private parking manager and had selected Republic Parking Systems over some others as a preferred management firm. Then the June flood hit and the matter was set aside.