Millions would be lost in Kings parking scheme
As we were putting our newspaper to bed, the Sacramento City Council was expected Tuesday to edge a bit closer to privatizing the city’s parking system.
Last week, a consultants report was made public which suggests the city could get anywhere from $170 million to $245 million in an upfront cash payment if it sold parking operations of city garages and meters and parking tickets for the next 50 years. That would hopefully be enough for the city’s share of a new basketball arena for the Sacramento Kings.
Right now, the city general fund gets $9 million in revenue from parking operations every year, so right off the bat you see roughly what kind of exchange we’re talking about.
You’re basically giving up a slow but steady trickle of a half-billion dollars—that’s in today’s dollars, a number certain to go up with price increases and inflation and, if boosters are to be believed, the increased parking revenue generated by all that development.
In exchange, the city would get, at most $245 million upfront. Then you have to subtract the $52 million the city already owes on three of its parking structures.
The more restrictions the city puts on parking rates and other parts of the deal, the lower the value of concession, and the lower the upfront payment to the city.
The city council has promised, so far, that all the money diverted from the general fund has to be backfilled from other sources, but those sources won’t be revealed for a while yet. Assistant City Manager John Dangberg has said it could come from sources of money generated by the arena project itself—like property taxes or arena parking or surcharges. But all that still has to be negotiated with the team and with the NBA.
The city council was expected on December 13 to approve issuing a “request for qualifications” from parking companies that might bid on the monetization scheme. At the same time, city officials would be negotiating with NBA, and something more solid would be in front of the council in mid-February.
That means it’s likely the public won’t get a good look at the plan, with all the moving parts explained, until right before the Maloof/NBA deadline of March 1 to have a viable financing plan in place for a new arena and prevent the Kings from skipping town. Funny how that works out.
Compiled from Snog.