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Wednesday, March 31, 2004

Spokane

At a glance: Anatomy of a decision

The decision: The 1997 ordinance requiring the city to loan money from its parking meter fund if certain expenses of the River Park Square parking garage weren't covered by parking fees.

  • Who made it: The City Council voted 6-0 on Jan. 27, 1997, after hearing a report from accountants Coopers & Lybrand and being heavily lobbied by supporters and critics of the project.

  • Why it became controversial: The council thought the parking meter fund would be rarely, if ever, tapped, and if it was, for only a short-term loan. When the garage opened, however, its revenues were so low that the city faced a regular drain on its parking meter funds with no foreseeable prospect of repayment.

    Warnings from Coopers & Lybrand were not detailed for investors who bought bonds backed by garage revenues, but the optimistic revenue projections from an earlier report from Walker Parking Consultants were.

  • What went wrong: The Coopers & Lybrand report correctly noted potential problems with key assumptions in Walker. Among them: --Projected parking revenues ‘‘appear somewhat aggressive” regarding the hourly rate of $1.50. The rate was eventually lowered for evening parking and capped at a maximum of $5 during the day.

    --AMC Theatres might expect free parking for its customers. The company did, and evening rates were lowered through negotiations, which lowered revenue.

    --Garage customers might not park the estimated three-hour average to pay $4.50. The garage doesn't keep track of how long customers stay, but the average fee is $2.75.

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