July 29, 2014 at 4:37 pm

Detroit City Council rejects Orr request for bids on parking department

In April, Emergency Manager Kevyn Orr imposed higher fines for parking tickets, calling it 'necessary and appropriate' to increase funds available to the city. The hike was the first for Detroit in more than a decade. The city had been paying $32 to issue and process a $30 parking violation. (Charles V. Tines / The Detroit News)

Detroit — The City Council on Tuesday turned down a request from Emergency Manager Kevyn Orr to solicit proposals from bidders interested in running or buying Detroit’s municipal parking department.

The panel voted 6-2 against seeking proposals after it first failed to pass a resolution to postpone the matter until September. Members Saunteel Jenkins and Pro Tem George Cushingberry Jr. voted yes.

Orr went to the council for its approval before putting out the request to comply with a letter of agreement he reached with the city’s parking unions.

Bill Nowling, a spokesman for Orr, said the emergency manger is “disappointed” with the council’s action.

“This proposal would have only secured a valuation for the City's parking garages and meter system, and gauged the market interest for such a transaction,” Nowling wrote in an email. “This issue could come back before Council, but the emergency manager is still reviewing today’s action and no final decision has been made.”

Detroit’s Chief Operating Officer Gary Brown urged the council to vote yes, noting the request is very broad and would seek offers to purchase one or more of seven parking garages, Detroit’s meters or all of its assets. Any bids or solicitations would then be brought back to the council.

Brown added that it was anticipated that city unions would be crafting a package to compete in the bidding.

Brown said staff wanted to start the process before the council’s summer break begins at the close of Tuesday’s session. The panel is slated to be back on Sept. 2.

The council’s policy staff said the process has been “fairly rushed” and the council should be cautious in its handling of the “very sensitive item.”

Councilwoman Raquel Castaneda-Lopez said she rejected the request because she felt that the process didn’t seem thorough.

“To me, I felt it was rushed,” she said, adding the parking department should have been engaged in submitting a proposal to show how it could improve service and cut costs prior to sending out a request for bids.

“It seemed like a flawed process that was missing information.”

Jenkins said she supported the request and believes it’s a good idea to see what options are out there.

Earlier in Tuesday’s meeting, Joseph Valenti, president of the Teamsters Local 214, urged the council to hold off.

“...let the unions, department and City Council work together to try to salvage this ourselves instead of selling this to someone else,” he said. “Please give us a chance before we get rid of another department.”

Orr has been evaluating the potential sale or lease of the city’s parking assets since last year.

In April, Orr imposed higher fines for parking tickets, calling it “necessary and appropriate” to increase funds available to the city. The hike was the first for Detroit in more than a decade. The city had been paying $32 to issue and process a $30 parking violation.

The fee changes bumped tickets from $30, $50 and $80 to $45, $65 and $95, respectively, for parking violations and late fees. The new schedule also eliminated a $20 rate for early payment.

The ticket increases were among the revenue-generating strategies recommended by the city’s restructuring consultants.

Officials have said about half of Detroit’s 3,196 on-street meters are not operating properly at any given time.

Brown says the city has done “extensive investigation” on which meters it wants to use and has $9.5 million on hand to purchase new parking meters. Officials, he says, are waiting for a determination on the direction the department will take before it moves ahead.

Despite the funding in escrow for new meters, Brown said officials have determined it would take a minimum of $25 million to upgrade and operate the parking garages over the next five years. The necessary funding for those upgrades is not included in the city’s debt-cutting bankruptcy plan, he said.

cferretti@detroitnews.com