Purpose

This memorandum presents an update to Council on the downtown parking program, a part of the Burbank Parking Authority.  Current management practices have resulted in issues related to downtown parking usage, parking enforcement, and the financial viability of the program.

ISSUE:

The Downtown Parking Management Program has two significant operational issues, effective management of the program and the projected program funding deficit.   The current parking program cannot be effectively managed or enforced, resulting in a wide ranging perception of insufficient parking supply.  However, a number of consultant and staff parking studies over the last fifteen years have all concluded that the downtown area has enough parking spaces, but the most convenient spaces are always full.

The cost of operating and maintaining the downtown parking system will exceed revenues by about half a million dollars each year for the next five years.  Employee user fees (permits) and leases comprise the bulk of the downtown parking revenues.  As a consequence, downtown employees, who pay the user fees, bear a disparate burden of the parking system operating costs; and the program encourages many employees to circumvent the permit process.

BACKGROUND

Downtown parking management became an issue with redevelopment efforts of the early 1990s, particularly the completion of the first AMC theater project.  The intensified development in the downtown brought numerous complaints of the lack of convenient parking.  Three parking studies were performed by outside consultants since that time to assess the adequacy of the parking supply, and staff conducted follow-up studies to confirm consultant results.  Each study concluded that sufficient parking supply exists in the downtown to support existing businesses and ongoing revitalization efforts.

City Council appointed the Downtown Parking Management Committee (DPMC) in 1999 as an advisory body to study the downtown parking supply and to assist staff in the development of an overall parking management strategy. This committee is comprised of eleven members representing the downtown business community, the Transportation Commission and the Burbank Town Center. In this past year, a representative from the Burbank Advisory Council on Disabilities was added as a liaison to the committee.  In a collaborative effort with staff, the DPMC prepared, finalized and approved a complete parking management plan for the 12-block downtown.

Staff presented the DPMC sanctioned comprehensive parking management plan to Council in January 2006.  The plan included pay parking for on-street and off-street parking spaces but provided a free initial parking period in the structures.  The plan also included an option for validated parking for additional free parking time. The DPMC management plan was endorsed by the Traffic and Transportation Committee and the Burbank Town Center. The management plan created parking turnover in the most convenient parking spaces, to accommodate the maximum number of users in these prime spaces, and allocated the lesser used remote spaces in outlying facilities to long-term parkers.  The DPMC recommended that revenue from the program be directed to downtown enhancements, additional enforcement, and adequate staff to administer the program.  Council agreed with portions of the proposal, but felt the scope was too broad.  Council requested that staff modify the plan to retain much more free parking.

Staff presented a modified downtown parking management plan to Council in May 2006 that included increased enforcement to manage the parking demand in the downtown. The proposal used new technologies to enhance existing enforcement[1].  However, without new revenue from parking user fees, the Parking Authority budget is insufficient to offset the cost of an improved parking enforcement. Furthermore, increased maintenance costs will cause the Parking Authority fund to fall below the required reserve balance sometime in the next fiscal year.  City Council directed that staff further study the financial implications of the declining fund balance and return with a detailed report.

A detailed analysis of the Parking Authority Fund was presented to Council in September 2006 illustrating the fund balance decline.  The report also showed that those downtown businesses who most directly benefit from free public parking do not contribute to the program finances in any way, and these businesses do not subsidize employee parking user fees (permits). The employee permits, which allow parking in excess of posted time limits, currently contribute a significant part of the parking program operating revenues.  Council directed staff to expand outreach to downtown businesses in an attempt to increase voluntary participation in the monthly parking permit program.  The increased outreach efforts failed to achieve any significant change in permit purchases.

ANALYSIS

The downtown area has about 5,000 public parking spaces included in on-street and off-street parking, and the Town Center Mall has another 5,000 off-street parking spaces.  The downtown parking supply has an unusual configuration which makes available parking difficult to locate for downtown patrons. The remote parking is particularly concealed.  The lack of parking turnover in the most convenient parking spaces leads to traffic congestion from cruising drivers in search of parking, and it causes a wide perception that Downtown Burbank does not have sufficient parking.

Three crucial elements of parking management identified in the downtown parking management plan are: parking usage, parking enforcement, and parking facility maintenance.  Parking usage is controlled through pricing or enforcement of posted time restrictions. Parking enforcement resources provided by the Police Department are limited, which results in frequent abuse of time limits and a lack of parking turnover.  Maintenance costs of downtown parking facilities have increased beyond the ability of Parking Authority to fund without additional revenues.  Capital maintenance costs have also grown with the age of the parking facilities, and capital improvement costs are not adequately budgeted in the current fund.

Parking Usage:

The effective management in a completely free parking system is very challenging because it relies upon consistent, active enforcement of posted time limits. Parking management through pricing, as proposed in the parking management plan, allows motorists the opportunity to decide where and for how long they wish to park. The most desirable parking spaces must have a higher cost than remote parking spaces. A pay parking system does not eliminate free parking, but allows the location and amount of parking demand to be controlled.

All the downtown parking studies undertaken in the last 15 years identified the lack of parking turnover in desirable parking spaces as the main parking problem for Downtown Burbank. The proposed management plan identified solutions to increase parking turnover that have moved forward for implementation: Wayfinding signage, Smart Signage and valet service.

 Wayfinding signs were installed in the downtown in 2005.  These static signs are placed at strategic locations to direct motorists to nearby public parking facilities.  The static signs are clearly recognizable through use of a consistent downtown color scheme.

The Smart Signage program is in the design phase and construction is anticipated to begin in August 2007 with a completion date of November 2007. The Smart Signage program will work in conjunction with the Wayfinding signs to further direct motorists to available parking. Smart Signage is an electronic changeable message board system installed on the parking structures that indicate the availability of parking.  If the parking facility is full, the changeable message sign directs motorists to the next available parking facility.  These two signage systems should help reduce traffic congestion caused by vehicles cruising the downtown looking for public parking.  They will not, however, reduce the incidence of parkers that exceed posted time limits.

The City adopted a valet ordinance in July 2006.  City traffic engineers approved various specific locations in the downtown for valet operations.  Multiple valet operators have attempted to offer valet service in each of the valet locations, but usage has been variable.  Several operators have terminated operations due to lack of participation.  The valet operation on Magnolia Boulevard in front of the Town Center relies upon subsidies from the Town Center to remain operational, and a second downtown valet service is struggling. 

Staff presented a detailed analysis of the Parking Authority finances to Council in September 2006.  Council directed staff to extend outreach efforts to downtown businesses to increase voluntary participation in the monthly employee parking permit program.  The employee user fees are a significant source of funds for the Parking Authority.  All downtown businesses were sent a direct mailing describing the benefits of the program and additional information on how to participate.  Larger businesses were visited personally.  The program has not seen any increase in the purchase of downtown permits since the expanded outreach.  Any increase in permit sales has been from new users in the Magnolia Park area.

The monthly parking permit program is a main revenue source for facility maintenance; consequently, downtown employee parking fees maintain the parking supply for all downtown users.  The cost of a monthly permit is $40 with a $5 increase scheduled for each of the next two years.  Even though the downtown permit fee is below the accepted market rate of $70 per month for downtown parking, the fee has likely been raised to its limit.  Additional employee user fee increases will drive employees away from the program, resulting in lower overall parking revenues.  Since enforcement is the main parking management tool in downtown and citations are $30 per violation, users will tend to chance a ticket rather than pay the user fee.

Unrestricted access to free parking in the subterranean structure on Palm Avenue is contributing to an ongoing problem in that parking facility.  Weekend nights have seen an increase in speeding, alcohol consumption, and loitering in the lower levels.  Even with security personnel in place, this problem persists.  An additional security guard has been requested by the property owners and will be added on weekends in hopes of curbing this unwanted behavior.  The added security will be partially financed by the Parking Authority.

Enforcement:

The police department enforces time restrictions in the downtown area as a component of a citywide parking enforcement program.  The citywide parking enforcement includes 13 Parking Control Officers (PCOs) assigned to six established beat areas in the city.  The downtown area is included in one beat that encompasses the southern portion of the city, and the downtown is less than 1/10^th of the total beat area, as shown in Attachment 1.

The existing downtown parking enforcement program has two inherent shortcomings that foster parking management issues: the frequency of enforcement and the cumbersome enforcement methods.  The existing beat system does not provide sufficient enforcement coverage in the downtown to insure parker adherence to posted time restrictions.  Although the on-street and off-street time restrictions are appropriate and reasonable, regular parking patrons know enforcement frequency is insufficient to identify most violators.  Thus, the prime spaces of one-hour duration (along San Fernando Boulevard) are occupied throughout most of the day by longer-term parking.

The archaic procedures used by parking enforcement personnel also contribute to the incidence of violations.  A PCO must mark or chalk tires, wait the posted time limit, then check tire marks to issue a citation.  The process is time consuming, it has significant flaws (parkers remove chalk marks or slightly shift the vehicle in the parking space), patrolling is infrequent with the existing beat system, coverage occurs only on Monday through Friday from 7:30 a.m. to 5:00 p.m. and weekends from 7:00 a.m. to 4:00 p.m., and the same officer must mark and check the vehicle to comply with court requirements.  Thus, the infrequent citations resulting from the enforcement procedures do little in curbing downtown parking violations. 

Facility Maintenance Costs:

The Parking Authority Fund revenues offset some of the annual parking facility maintenance expenses.  The maintenance costs are comprised of contractual services for routine maintenance and repair, elevator maintenance and repair, utilities, property taxes, permit supplies, and cost allocation to other departments. Annual operating expenses have exceeded annual operating revenues for the past five years.  The Parking Authority fund balance has been used to make up the revenue shortfall; however, the fund balance is now depleted.  Non-operating interest income decreases each year as the balance is depleted to offset operating expense costs.  All operating revenue is expected to remain relatively constant with the exception of the monthly employee permits and two new downtown parking leases.

Common Area Maintenance, Inc. (CAM) provides the daily routine maintenance of the City�s public parking supply. CAM is in the final year of a three-year price agreement.  The City will solicit bids for maintenance services at the end of the current contract period to award a new contract.  Maintenance expenses are anticipated to increase when a new contract is awarded. Current maintenance costs are determined by the level of parking structure use, and the maintenance needs, hence costs, vary for each structure.

Attachment 2 shows the downtown public parking supply.  The City owns and operates three downtown parking structures: the AMC structure (Facility A), the Orange Grove structure (Facility G), and the Courthouse structure (Facility M).  The AMC structure has a unique maintenance arrangement.  In return for parking easement rights, four parcels adjacent to the AMC structure (Facility A) are assessed the costs to maintain this parking facility. Maintenance costs for the Courthouse structure (Facility M) are offset by a 20 percent contribution from Los Angeles County.  The third City structure (Facility G) is the City�s oldest structure, built in 1978, and all maintenance costs are paid by the Parking Authority.

The Parking Authority pays lease payments and taxes for one of the parcels on which the Courthouse structure is built.  The Authority has an option to purchase this privately owned parcel for $600,000 in Fiscal Year 2008-09.

The City has lease rights for public parking in four privately owned downtown structures: the Gangi structure (Facility N), the Cusamano structure on Orange Grove Avenue (Facility H), the new Village Walk structure (Facility R), and the old DIC structure (Facility P).  The City shares operating costs through lease obligations for the Gangi structure (Facility N) and the Cusumano structure (Facility H). The Parking Authority pays an annual management fee to Gangi Development to offset the cost of maintenance, security, and administration of the 300 public parking spaces in the structure.

The City owns 50 public parking spaces and has lease rights to 127 parking spaces in the Cusumano parking facility on Orange Grove Avenue (Facility H). Shared maintenance costs for this structure are paid through Redevelopment Agency contributions.  All spaces in the Cusumano structure are open to the public after 6:00 p.m. Monday through Friday and all day on weekends.  The City has public parking rights to 120 parking spaces in the Village Walk structure recently completed by the Olsen Company (Facility R), and evening and weekend rights to 150 spaces in the DIC structure (Facility P). The City does not have maintenance obligations in either of these two structures. 

Construction of the Collection project (AMC Phase II) is underway with an expected completion date in the spring of 2008.  The City will gain 275 parking spaces in the newly built parking structure at the lowest level of the garage.  Assignment of parking structure maintenance responsibilities and costs are still in the negotiation stages. However, based on the per space cost of maintenance in the adjacent AMC structure, the City can anticipate a minimum maintenance obligation of approximately $110,000 annually.  This estimate does not include reserve contributions for long-term structural capital improvements, an anticipated requirement by the property owner.

As our structures continue to age, capital improvements are needed to preserve and possibly extend their design life. The downtown parking structures vary in age from as old as 29 years for the Orange Grove structure (Facility G) to 13 years for the Courthouse structure (Facility M).  Structural improvement needs differ according to age and level of use. Not surprisingly, a younger structure, such as the AMC (Facility A) built in 1989, which is the most heavily used structure in the downtown, is most in need of capital improvements.

The City contracted Walker Parking consultants last year to provide a structural assessment of the three City owned parking structures and to develop a Capital Improvement Protection Plan (CIPP).  Walker identified immediate repairs and provided a ten-year CIPP that included elevator upgrades and on-going structural and aesthetic improvements.  The recommended restorations will maintain the parking structures in a serviceable condition and help reduce future repair costs and future deterioration of the parking structures. Because the cost of capital maintenance was never budgeted in the Parking Authority fund it has been allocated on an as needed basis.  Walker Parking consultants recommend budgeting $1,784,300 over the next ten years for restoration capital improvements of the City�s three parking structures as itemized in Attachment 3.

FISCAL IMPACT

The Parking Authority Fund was established in the early 1970�s to administer the downtown parking system at that time.  The sources of income for the Parking Authority include monthly parking permits, leases, and assessments in the downtown area and at selected remote parking facilities.  As shown in Attachment 4, the projected revenue for Fiscal Year 2006-07 is $766,000.  Almost half of the income (42 percent) is from monthly employee parking permits, while leases (to provide for employee parking) amount to 32 percent of the total and assessments are about 26 percent of the total.  Thus, the downtown employee parking fees are a significant component of the Parking Authority income, which in essence subsidizes free customer parking for businesses in the downtown.

Parking Authority expenses include real estate acquisition, construction, operation, and maintenance of parking facilities for the City.  During the last decade, parking facility acquisition and construction have primarily been financed by Redevelopment Agency funds, while the Parking Authority has funded routine maintenance.  Long-term corrective maintenance has not been undertaken.

Historically, the fund balance allowed the Parking Authority to act as an independent entity without City assistance; however, increased routine maintenance costs have grown to exceed fund income.  Thus, long-term structural maintenance of the downtown parking system has not been funded.  At this time, the Parking Authority operates at a deficit of approximately $100,000 annually without long term maintenance and at about $500,000 with long term maintenance.

A five-year projection of the Parking Authority income and expenses is shown in Attachment 5.  With the addition of long term maintenance costs, the Parking Authority deficit is expected to average about $460,000 per year between FY 2007-08 and FY 2011-12.   Since Redevelopment Agency funds cannot be used for maintenance, two possible funding sources are readily available, General Fund and parking user fees.

For fund viability, fiscal policy requires the Parking Authority to maintain a balance equal to 60 days operating expense. The Parking Authority is projected to fall below this reserved balance requirement during the next fiscal year.  The Downtown Parking Management Committee discussed the Parking Authority deficit at their March 29, 2007 meeting, and voted by majority to recommend to Council that General Fund monies be used to make up the deficit.

RECOMMENDATION

Staff requests that Council provide further downtown parking management direction regarding policies, enforcement and budgeting.

Attachments:

Attachment 1 � Parking Enforcement Beats

Attachment 2 � Downtown Burbank Public Parking        

Attachment 3 � Combined Budget Forecast for Structures A, G, and M

Attachment 4 � Sources of Parking Authority Income

Attachment 5 - Projected Parking Authority Income and Expenses

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