Chicago City Council to vote on parking meter sale deal as court fight looms
The Chicago City Council is set to vote on a parking meter sale deal in their meeting Tuesday, or face going to court.
Thet deal was negotiated by Finance Committee Chair and 3rd Ward Ald. Pat Dowell, 32nd Ward Ald. Scott Waguespack, 36th Ward Ald. Gilbert Villegas, 27th Ward Ald. Walter Burnett and 11th Ward Ald. Nicole Lee.
The city faces a Sept. 30 deadline to either approve the sale or risk having to fight the deal in court.
The deal involves the sale of the remaining 57 years of the lease Chicago Parking Meters LLC holds for the city's parking meters to New York-based Stonepeak Partners.
In it, the city would get an up-front payment of $75 million immediately upon the transfer of the meters to Stonepeak, then an additional 5% profit share from the annual net income of the meters for the duration of the lease. City officials have estimated that profit share amounts to about $367 million over the 57 years.
There is opposition to the deal, including concerns that after costs of interest expenses are deducted and the overall depreciation of the meters over time, the city will only net around $140 million from the profit share.
The council was originally set to vote on the deal in a special meeting Friday, but Dowell and Waguespack moved to defer and publish until Tuesday's meeting.
Then-Mayor Richard M. Daley's 2008 deal to lease the city's parking meters to Chicago Parking Meters LLC in exchange for a $1.15 billion lump payment is widely considered to be one of the worst financial moves in the history of municipal politics. Mayors since have worked, and largely failed, to find a way for the city to recoup any of the revenue coming from parking fees since.
Mayor Johnson's administration explored the possibility of buying back the parking meters, but determined it was too expensive, requiring the city to take on a massive amount of debt. As a result, any revenue from the meters would have had to pay off that debt for the next 40 years, effectively forcing the city to raise parking rates annually to cover costs.
The deal the council is considering today earmarks the money from the parking meter sale to pay the city's ongoing pension obligations.
