TU: Jacksonville has time to make decision on 3 parking garages

[Patricia M. McBride]

This is something we may need to keep an eye on as it would mean the city buying up these 3 garages which takes them off the tax rolls.  Downtown has moved from contributing about 18% of the total tax revenue to around 3% of the tax revenue and here we go again.  These garages need to be sold to someone who can make a profitable go of them (perhaps if they charged something reasonable to park in them, someone might park in them??).  From my personal experience one evening when I went to city council meeting, I parked in the parking garage just down from city hall which closes at 7 PM (I think it was 7), they charged me $7.00 to park there for 3 hours at which point I had to move onto the street or go pay to park in another lot.  The cost is an outrage!

 

The cost won't go up over the next two years on three downtown structures it could buy.

By Timothy J. Gibbons   

October 27, 2011 - 12:00am

Jacksonville has time to make decision on 3 parking garages.

Jacksonville will have two more years to decide if it wants to buy money-losing garages downtown - without having the purchase price jump in the meantime.

In the past five years, the city has loaned $16 million to a parking company it picked to own and operate three downtown garages. That money includes an 8 percent rate of return on money the company, Metropolitan Parking Solutions, put in the deal.

The city can get out of the contract that requires those loans if it buys the garages, which it never wanted, for $50 million by Dec. 31. According to the contract, that amount would jump by about $4 million next year and keep on climbing until the deal was consummated.

The City Council auditor's office has strongly recommended purchasing the garages, but the mayor's office said during the budget process that it didn't want to jump into such a project now.

Earlier this week, though, Metropolitan Parking Solutions agreed to keep the price firm through the end of 2013, giving the city some breathing room.

"We weren't ready at this point to spend money on garages if we didn't have to," Chief Financial Officer Ronnie Belton said. "This gives us room to make a decision."

The company also agreed to a reduction in the return it gets on its investment, from 8 percent to 6.75 percent.

All of that money, according to the contract, will be repaid to the city if the garages start making a profit. That's expected to happen next year, when the new county courthouse opens, driving traffic to the Metropolitan garage on Pearl Street. However, since there's no cap on how much Jacksonville will loan the garage operator, the city has unlimited liability.

Metropolitan Parking Solutions President Ken Krismanth said the company was trying to be a good partner by agreeing to the time extension and the lowered rate of return.

"We think it's the right thing to do," he said. "We're trying to sit down and help the city out."

If the city doesn't buy the properties, it could expect to pay millions of dollars a year to Metropolitan, city auditors have said, a claim Krismanth denies.

Once the courthouse opens, he said, the property will make millions, allowing the company to repay the loans.

"This has been frustrating for all sides," he said. "We're looking forward to meeting the performance goals."

The city is also waiting to see how the properties perform, Belton said, information the city needs to make a decision about a purchase.

Read more at Jacksonville.com: http://jacksonville.com/news/metro/2011-10-27/story/jacksonville-ha...