Yeah, this aired a few weeks ago, but we’ve been too distracted to remember to post this video of a discussion on Mayor Emanuel’s proposed renegotiated meter lease deal on the always enlightening Chicago Tonight.

The producers invited the City of Chicago’s Corporation Counsel Stephen Patton, World Business Chicago Vice-Chair Michael Sacks, Ald. Scott Waguespack (32nd) and some other doofus who writes for a local website called The Expired Meter to debate the proposal.

Ald. Brendan Reilly at City Hall. Photo credit: Ted Cox/DNA Info Chicago.

42nd Ward Alderman Brendan Reilly is fighting back against Mayor Rahm Emanuel’s plan to revamp Chicago’s infamous parking meter lease deal and looking for viable alternatives on his own.

On Monday, he sent an email newsletter to constituents laying out his views on the matter.

Reilly has a lot to dislike about the Mayor’s plan as it includes increasing the hours meters must be fed in a majority of his ward three hours from the current 9 PM to midnight.

As part of the renegotiated deal with Chicago Parking Meters, LLC, Emanuel is asking for free Sunday parking in the neighborhoods allegedly in exchange for an additional hour of meter enforcement Monday through Saturday until 10 PM, and of course the extra three hours in River North.

“Over the past week, I have heard from hundreds of my constituents and hundreds more from across Chicago who object to the City Council lengthening meter hours in exchange for “free” Sunday parking in areas outside of the Central Business District and Near North side,” Reilly writes in his newsletter. “We all know nothing is truly “free” and this certainly applies to the Sunday parking proposal. Rest assured, families from every corner of the city will be paying for that “free” parking until 10 PM in their neighborhoods during the week. When they visit downtown for dinner, a movie, or concert they’ll pay to park until Midnight. No matter where you live, you’ll pay for that “free” parking one way or another.”

But Reilly is not just griping about the raw deal for his ward, he’s seeking alternative solutions to the meter deal mess. He’s been investigating the prospect of floating a municipal bond to buy the meters back from CPM–although he admits this is not without some downside.

“In the meantime, I have also been meeting with municipal bond experts to try and identify ways for the City of Chicago to potentially buy-back this valuable public asset,” continued Reilly via his newsletter. “Although we would have to potentially pay more for the asset than we originally leased it for – buying it back now could limit our exposure to future, costly litigation by CPM and allow the City to again control the asset decades before the Lease would be due to expire. Bond experts have informed me that this approach is within the art of the possible and I will continue to aggressively pursue this option.”

And although Reilly is at odds with the Mayor over the free Sunday parking and extended hours of enforcement, he makes it clear that he is highly supportive of what the Mayor and his team to renegotiate the closure and True Up revenue issues.

“I applaud the Mayor and his team for their excellent work to secure a settlement agreement that would limit the City of Chicago’s exposed liability on annual reimbursements to CPM for meters taken out of service by the City (for free handicapped parking, rush hour parking restrictions, etc.),” he writes. “The Mayor’s team compelled CPM to accept our econometrics in calculating annual “true-up” money owed to the Company. Without this great work, the City would have been obliged to pay CPM roughly $20 million per year over the remaining 71-year lease (slightly over $1 billion). This is a big victory for taxpayers.”

Despite this, Reilly is still a no vote on the proposal.

“I truly believe his team did an excellent job negotiating a settlement to the $1 billion in potential liability over the term of the lease and I would vote to approve that good work in a heartbeat,” Reilly says. “However, extending meter hours until 10 PM or Midnight for more than 29,000 parking spaces across the City, six days a week, would be a burden for many families across Chicago and could result in yet another windfall for CPM. I simply cannot support this proposal.”

Here’s Reilly’s full statement, “Alderman’s Update Regarding Controversial Parking Meter Proposal.”

An old school parking meter from before the notorious Chicago parking meter lease came into being in 2008 adds its two cents.

The early results are in, and the overwhelming consensus is that Mayor Rahm Emanuel’s remix of the infamous Chicago parking meter lease deal is a bad idea.

So far, outside of a handful of politicians, nobody supports the recently announced renegotiation of the 75 year meter lease.

While most voices support the Mayor’s efforts in reducing the payouts to CPM for street closures and alleged changes to the meter system’s value, it seems the Mayor’s free Sunday parking proposal is a non starter.

That’s probably because the trade off is having to feed meters until 10 PM instead of the current 9 PM, while drivers in River North may have to plunk down quarters to park until midnight.

The Chicago Tribune editorial board poses the question, if Chicago Parking Meters, LLC supports the deal, shouldn’t we be worried?

The Trib, speaking directly to city council members, pleads:

Aldermen, you know how badly you served your constituents in 2008.

Do your jobs this time. Ask questions. Lots of questions.

This time, ask questions. Lots of questions. And when you get answers, then decide.

Fool me once ….

Crain’s Chicago Business is definitely not buying what Mayor Emanuel is selling. In fact, Crain’s pulls no punches in the headline of their recent editorial entitled, “City’s renegotiated parking meter deal still stinks.”

Perhaps offering free parking on Sundays in some neighborhoods will help Mr. Emanuel’s chances for re-election. But instead of providing real relief, this renegotiated deal just pushes the slop from one trough to another. The length of the contract has not been shortened by a millisecond. And the absurdly high rates are not one penny lower. This isn’t an improvement; it’s a capitulation.

Of course it’s no surprise 42nd Ward Alderman Brendan Reilly is fighting the revised meter deal. That’s because most of his ward will bear the brunt of the proposed free Sunday parking at neighborhood meters. Residents of River North and patrons of the many bars and restaurants there will have to feed the meters an additional three hours until midnight under the Mayor’s plan.

Other aldermen are very skeptical or also opposed according to the Chicago Sun-Times, and ABC 7 News.

Although, according to the Chicago Tribune, a group of 24 aldermen came out publicly in support of the new plan on Thursday. Unsurprisingly, most generally are supporters of Emanuel’s policies.

Under normal circumstances, Mayor Emanuel usually gets his way. But this time, things might be different.

Aldermen won’t vote on the changes until next month.

Chicago Parking Meters, LLC brought in an additional $30 million in meter revenue according to financial statements released to the city.

Gross parking meter revenue was up nearly 29% last year according to CPM’s most recent income statement. Revenue rose from $108 million in 2011 to over $139 million in 2012–an over $30 million increase. Parking meter rates rose only 16% between 2011 and 2012.

“At some point you have to laugh at how much revenue they’re bringing in,” said Alderman Scott Waguespack (32nd). “At this rate the company will recoup their investment in just 10 years.”

The original meter lease deal back in 2008, gave CPM a 75-year lease for a one time payment to the city of $1.16 billion. Waguespack was one of only five no votes on the lease and at the time, strongly believed the payment low-balled the true value of the nation’s third largest metered parking system. Although originally the bulk of the billion plus dollars was earmarked for rainy day savings, most of the proceeds have already been spent.

But CPM’s financial statements also seem to reveal the dramatic fiscal impact to the company’s bottom line from the hard fought settlement Mayor Rahm Emanuel and his team’s recently negotiated.

Read more at DNA Info Chicago.

Mayor Rahm Emanuel announces changes to the parking meter lease deal at a press conference Monday. Photo credit Ted Cox/DNA Info Chicago

Chicago Mayor Rahm Emanuel may have done the impossible.

He may have actually made Chicago’s reviled parking meter lease deal even worse.

At a press conference Monday morning Emanuel announced a settlement in the ongoing legal battle between the city and Chicago Parking Meters, LLC (CPM).  Initially, it sounded like the city had indeed arm twisted some mild improvements to the universally despised deal out of CPM.

But as details of the proposed settlement emerged over the course of the day, Emanuel’s allegedly new and improved parking meter lease deal looks like it could make things even more challenging and expensive for Chicago drivers.

The mayor wants to allow Sunday drivers to park for free. On its surface, the concept evokes the idyllic image of church-going Chicagoans driving to worship early Sunday morning. But at his press conference, the mayor conveniently left out the important fact that meters still must be fed Sunday downtown in the Central Business District.

Since traffic and parking volume is lowest on Sundays, it’s certainly not much of a concession on CPM’s part.

Inexplicably however, Emanuel agreed to extend meter enforcement by one hour at most metered spots so that drivers must feed meters Monday through Saturday until 10 PM.

Adding even more salt to the wound, the mayor targeted the River North entertainment district and wants to allow CPM to charge for meters until midnight seven days a week–a three hour increase.

While City Hall estimates CPM will see an $8 million loss from allowing free Sunday parking, it says the company will make up $7 million of that amount up with the extended meter hours. Overall, Chicago drivers won’t see any benefit from these changes.

But many people are skeptical the city’s math will hold up. 32nd Ward Alderman Scott Waguespack thinks its possible CPM could actually end up generating even more revenue from these changes.

“It’s essentially going to be a wash or we’re going to be paying more,” said Waguespack.“Restaurant patrons, bar patrons, they’ll all be paying more. That would probably make them (CPM) a lot more (money).”

Initially, Emanuel’s refusal to pay CPM for street closure bills last year seemed like a brilliant bargaining tactic–a tactic that would allow the mayor to fulfill a campaign promise to force CPM to renegotiate the meter deal. It could have been a rare chance to make needed changes to the steaming pile of parking pain former Mayor Richard M. Daley left behind for Emanuel to clean up.

The most glaring example is the meter rates themselves. Emanuel was unable, or unwilling to find a way to lower Chicago’s parking meter rates–far and away the nation’s highest.

But Chicago’s current three tiered rate system could have been exploited to lower rates overall. That’s because the inflexibility of the current rate structure keeps meter rates artificially high and most likely limits CPM’s revenue.

Under the current rates, someone parking in the low income Austin neighborhood pays the same as the driver in Wrigleyville who finally snags a parking spot after circling the block for 20 minutes.

Why didn’t the mayor sell CPM on a demand based pricing structure instead of the current system? By allowing a sliding rate schedule based on parking demand, rates in low income, low demand areas would drop while rates in high congestion areas would be allowed to rise.

This would allow average rates for Chicago drivers to decline overall while keeping CPM’s revenues constant or even higher than they are now. Not only would this make metered parking more affordable to more drivers, it would also serve as a defacto congestion tax reducing parking congestion as well as minimizing vehicles circling neighborhood blocks  searching for an open spot.

San Francisco has been experimenting with this model recently and initial reports seem to indicate diminished parking congestion and increased meter revenue.

Perhaps the only positive aspect of what Emanuel is proposing is the concessions from CPM on the tens of millions in street closure bills the company submitted. The mayor claims the company agreed to slash the $49 million in these bills to just under $9 million. Going forward, he says his administration was able to convince CPM to change the way street closure claims are calculated saving the city $20 million a year or over a billion dollars over the next 71 years left in the term of the lease.

But the Emanuel Administration is not providing details or any data to support their claim. So at this point, no one really knows for sure if any of these savings will actually materialize in the long run.

From the driver’s perspective, Emanuel’s plan makes little sense.

And based on the mayor’s reputation for being a tough as nails negotiator, the supposed concessions he’s gotten from CPM are impressive in how pathetic they are.

Is it possible Mayor Emanuel got outmaneuvered by Chicago Parking Meters?

It certainly seems so.

An old fashioned parking meter from before the meter lease deal was passed in 2008.

Making lemons out of lemonade.

That’s the tone Chicago Mayor Rahm Emanuel set when he stepped to the podium Monday morning to announce changes to the city’s universally derided parking meter lease deal.

“When I was elected Mayor, I said this was a bad deal, but promised to do everything I could to make improvements on behalf of the taxpayers of this city,” said Emanuel. “So, my administration fought to ensure not one tax dollar was paid that we didn’t need to pay. After thorough and ultimately constructive negotiations, I am proud to say that on behalf of the taxpayers of Chicago, we were able to successfully reach agreement with CPM to make some necessary and positive changes to this contract.”

Emanuel announced changes as result of a settlement with Chicago Parking Meters which includes free parking at meters on Sundays, a pay by cell phone option, and CPM’s agreeing to accept the city’s numbers when it comes to payments tied to street closures. The Mayor claims this will save city taxpayers $20 million a year or a billion dollars over the life of the lease.

“As one resident told me, ‘you shouldn’t have to pay to go to church’,” said Emanuel. “Whether you go to church or not, everyone deserves a break from feeding parking meters in our neighborhoods on Sunday.”

The Mayor had been battling CPM over bills from street closures–bills the Mayor had refused to pay. The Mayor’s Office says the $49 million in bills for street closures got reduced to just $8.9 million.

These changes in the settlement between CPM and the City will be documented in a city ordinance as amendment to the original lease deal, and be voted on by the Chicago City Council.

“The City of Chicago announced today that a settlement agreement and amendment to the Chicago Parking Meter Concession Agreement will be introduced to City Council on May 8, 2013. CPM is hopeful that the City Council will ratify both agreements,” reads a statement from CPM. “In the best interests of the people of Chicago, CPM collaborated with the administration and believes that our willingness to work with the City demonstrates our desire to provide the most efficient and technologically advanced parking meter system possible for the City of Chicago.”

While Sunday parking will be free in the neighborhoods, meters will still have to be fed in the Central Business District which is bordered by Lake Michigan, Roosevelt, Halsted and North Ave.

In addition, meter hours will be enforced an additional hour Monday through Saturdays. Parking meters which need to be fed until 9 PM will now extend to 10 PM. And in some areas of the city directly surrounding downtown, meters will have to be fed until midnight-an additional three hours. Meters which stop at 6 PM will stay the same.

While 32nd Ward Alderman Scott Waguespack is supportive of the city’s ability to monitor CPM billing for street closures, he’s not convinced there’s a net benefit to the proposed changes to the hours of enforcement.

Waguespack says the extended hours of parking may end up costing drivers more in the long run.

“It’s essentially going to be a wash or we’re going to be paying more,” said Waguespack.“Restaurant patrons, bar patrons, they’ll all be paying more. That would probably make them (CPM) a lot more (money).”

Waguespack is also critical of the mixed messages the Mayor is putting out. On one hand the city was fighting the bills from CPM, but on the other, the city didn’t join a lawsuit questioning the legality of the agreement filed by a group of Chicago citizens.

“If he believes the True-Up costs (street closure costs) are wrong why not go to court and fight the whole thing?” Waguespack asks.

The pay by cell phone option will not be available until summer of 2014 and will require users to pay a $0.35 convenience fee per transaction.

“Lets be clear here, this doesn’t solve our parking meter problem,” said Emanuel. “That’s just not possible. I’m trying to make a little lemonade out of a big lemon. We can’t make this bad deal go away or make it into a good one. But I do think we made it a little less bad for the next seven decades.”

The original meter lease deal was rushed through the city council in late 2008. Although alderman were given only 72 hours to read the hundreds of pages of the agreement and vote, the measure passed overwhelmingly 45-5.

The deal gave control of the parking meters to a consortium of investors organized by Morgan Stanley for a $1.16 billion up front payment for 75 years of control and meter revenue. Parking meter rates nearly quadrupled since 2008 and company revenue skyrocketed.

View more videos at: http://nbcchicago.com.

NBC 5 investigates Chicago’s parking meter lease deal.

They discover, to the shock of everyone, that Chicago Parking Meters, LLC, the company which won a 75 year contract to operate the meters by paying $1.16 billion in 2008, is making a ton of money.

What a surprise.

Marin interviews 32nd Ward alderman Scott Waguespack, who led the fight against the meter lease deal, who essentially tells NBC 5 viewers in his low key way, “We told ya so.”

The piece does reveal CPM generated $109 million in parking meter revenue in 2011. It is a gigantic number which means the company is on track to recoup their $1.16 billion investment in about 10 years.

That’s great news for CPM because they can spend the remaining 65 years of the lease essentially generating several billion dollars in pure profit.

Here’s NBC 5′s full piece, “Parking Deal a Windfall for Private Company.”

That’s what  NBC 5′s Ward Room columnist, Edward McClelland, calls Chicago Parking Meters, LLC,  the company which controls the city’s 30,000 metered parking spaces.

In a recent column, McClelland calls CPM a “parasitic business.”

McClelland, references a recent Salon piece by political commentator Michael Lind:

Lind was criticizing what he called the Rentier class — financiers who make money not by selling goods and services, but by “their natural or artificial monopoly power to extract excessive tolls, fees and other recurrent payments from the rest of society, including productive businesses.”

The typical rich American, Lind argued, “should be an innovative industrialist or technologist, not a Wall Street financier or a guy with a parking-meter monopoly.”

McClelland wholeheartedly agrees with Lind saying the 75-year lease for $1.16 billion is essentially a monopoly which CPM will exploit to the tune of billions of dollars over the term of the agreement.

While some of what Lind and McClelland say is undoubtedly true, their blame is completely misplaced.

Companies exist to maximize profit for their owners or investors. For the two writers to be surprised when a company like CPM behave in this way is naive and nonsensical.

Their ire should be directed at former Mayor Richard Daley, his administration and the alderman who voted for the crappy parking meter lease deal in the first place–not CPM for finding and executing a lucrative business deal.

Here’s McClelland’s full piece, “Chicago Parking Meters LLC, Parasitic “Business”.

A New York City Muni-Meter. Photo courtesy and copyright DNAinfo/Ben Fractenberg

Blame it on Chicago.

New York City has opted not to move forward with plans to privatize the city’s more than 85,000 metered parking spaces and Chicago is at least partially responsible according to the Wall Street Journal .

New York is just the most recent of many large U.S. cities that considered privatizing their parking meters but backed off. This list also includes Pittsburgh and Los Angeles. The WSJ blamed this inability for cities to consummate these privatization deals on the failure of Chicago’s meter lease deal and subsequent public backlash.

Instead of moving ahead with privatization, the Bloomberg administration has decided to initiate a modernization of its parking meters later in 2013.

Here’s the Wall Street Journal’s report, “New York Scraps Privatizing Parking Meters.”

Photo courtesy and copyright DNA Info New York.

It seems other news gathering organizations in Chicago also think it’s odd the city’s parking meters won’t be going up until February, a story originally broken here at The Expired Meter.