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LA Council Kills ‘Fireside Sale’ To Lease Parking Garages

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(Getty Images)

(Getty Images)

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LOS ANGELES (CBS) — The Los Angeles City Council on Wednesday killed Mayor Antonio Villaraigosa’s plan to lease nine of the city’s parking garages to private operators for the next half-century.

Villaraigosa had said the plan would generate up to $300 million for the city, including $53 million to close most of the current fiscal year’s $54 million budget deficit.

City Council President Eric Garcetti said the mayor’s numbers appeared to have been over-optimistic, based on advice he was given by independent experts.

“I have heard from people who work in this area saying it’s not realistic for us to be getting $100 million, or as high as some of the numbers we’ve heard out there,” he told the council.

Councilman Bill Rosendahl called the proposed deal “a fireside sale at the worst of times.”

The council instead voted to consider other options proposed by Garcetti to close its budget gap, including asking the Community Redevelopment Agency to buy down the debt of three parking garages in Hollywood, including the Hollywood & Highland lot which costs the city about $4 million in debt payments annually.

Another possibility includes trying to negotiate a deal with the city’s pension funds to reduce the amount the city must pay this fiscal year or even selling certain parking garages.

City Administrative Officer Miguel Santana previously recommended additional furloughs and layoffs to balance the budget during the four and a half months remaining in the fiscal year, because personnel costs account for more than 90 percent of the city’s expenses.

Several council members, however, expressed reluctance to further cut the pay of civilian workers already required to take either 16 or 26 days off.

The additional furloughs would prompt the closure of certain departments some Fridays.

“If I had to vote for people over concrete, of course I’d do it every time,” Councilwoman Janice Hahn said.

Villaraigosa on Monday directed the council to delete restrictions they had attached to the proposed parking garage concession agreement, saying it turned off all potential bidders.

The restrictions were discussed in closed session, but Garcetti hinted that they would have given the incoming management more freedom to raise rates on customers, and stifled competition by banning the opening of new parking garages nearby for half a century.

Chief Legislative Analyst Gerry Miller said the restrictions should stay put.

“I would not advise you to put forward a deal that has no policy restrictions in it — that’s exactly what Chicago did,” he said.

(©2010 CBS Local Media, a division of CBS Radio Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. Wire services contributed to this report.)

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