Tuesday, October 19, 2010

Council Rejects Parking Lease, Angers Firefighters

On a 7 to one vote with one abstention today, Pittsburgh City Council officially rejected Mayor Luke Ravenstahl's proposal to lease parking authority assets to a private company in an effort to shore up the underfunded pension fund. The 50-year lease would have resulted in more than $450 million dollars for the city. $220 million of it would have been used to raise the pension program above the 50% funded level to avoid a state takeover. After the vote the firefighters who had packed the council chambers gathered in the hall to listen to their president Joe King. King rallied his members by painting a picture of a city budget that he says will be 25-32 million dollars in the red. “All of this debt is going to fall on the
Home owners and the employees and the businesses of this city, “ says King, “ and I’ll tell you who should be held accountable, those nine people in there.” King says the firefighters will remember the vote when they go to the poles next year. He then called on council to reduce the city’s budget by reducing the size of city council. King warned his members that he believes the city will begin to “brown out” the department. He says the city cannot layoff firefighters so it will selectively, temporarily close firehouses to save on overtime. King says, “this is not about safety, this is about money.”

Council still has several options before it. A plan created by city controller Michael Lamb and sponsored by Council members Darlene Harris, Natalia Rudiak and Patrick Dowd calls for the city to sell the parking garage lots and meters it owns to the Parking Authority for $220 million dollars. That money would then be used to shore up the pension fund. The Authority would have to issue a bond to cover the cost. The proposal also gives the authority the ability to set rates without council approval. Dowd admits that it will lead to hire parking rates but he says the increase will be much less than if the assets were leased to a private company. “Given the choice between handing over the assets to a private company or a public authority, I’ll take the authority every time,” says Dowd.

Councilman Doug Shields says he will listen to the details of the controller’s pan at a meeting and debate it in council tomorrow but for now he still likes the idea of a state take over of the pension plan. He notes it is the only option that puts the pension plan on a 30-year path to being fully funded.

Voting for the lease deal was Ricky Burgess. Theresa Kail-Smith abstained.

LAZ Parking issued a written statement following council’s no vote expressing its disappointment. It reads in part, “Our expertise in operating, investing in and managing parking systems around the country would have provided great benefits to the City, its residents, visitors and downtown commuters…. Over the past several weeks we have had the opportunity to speak with members of Council and made several suggested amendments to be sensitive to the matters raised by Council Members.” The company says it will have other opportunities in other cities looking to better manage their parking assets and tackle fiscal challenges. The statement ends, “Our hope is that the City of Pittsburgh and other municipalities and government agencies around the country learn how important it is in a process like this one to have alignment between City Council Members, the Office of the Mayor and other important stakeholders.”

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