The Daily Parker

Politics, Weather, Photography, and the Dog

Remember those parking meters?

In 2008, Chicago gave up its parking meter revenue for 75 years in exchange for $1.16 billion, which made no sense at the time and got widely criticized by everyone who knows what "Net Present Value" means.

Guess what? The deal still sucks:

In their failed attempt to block Bally’s $1.7 billion River West casino, downtown City Council members warned the deal was being rushed — just like the one that privatized Chicago parking meters — and that it would end up being “even worse” for taxpayers.

That dire prediction is difficult to imagine, considering results of the latest parking meter audit by accounting giant KPMG.

It shows Chicago parking meter revenues nearly back to pre-pandemic levels. After dipping to $91.6 million in 2020, they climbed to $136.2 million last year.

Not a penny of those revenues went to ease the burden on Chicago taxpayers, who had to absorb a $76.5 million increase in the city’s property tax levy after a $94 million hike in real estate taxes the year before.

Factoring in the newly reported figure for 2021, private investors have already extracted $2.1 billion from the deal, in part by refinancing three times. The latest refinancing for $1.2 billion was completed in 2019.

Well, it turns out, if they got $900 million in revenue off a $1.2 billion investment over 14 years, that's an annualized ROI of just 4.1%. It's just that the ROI in the past year was well over 11%, so that 4% number is depressed by the deal's startup costs.

We'll have to see whether they continue making that kind of revenue. But the deal still sucks. We could have upgraded the technology and controlled our own parking destiny for a lot less money, and we'd have all that income now. I mean, if the Council didn't squander it. Ah, ha ha, ha.

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