City Council keeps parking lease conversation going
The City Council unanimously voted to keep conversations going with bidders interested in taking over the city’s parking operations – and set the stage for a Feb. 28 vote finalizing plans for a new entertainment and sports complex.
“Today is about narrowing 13 (bidders) down to 10, and it’s an intermediary step to a more significant vote,” Mayor Kevin Johnson said.
Council chambers were full Tuesday night, and members of the public who signed up to speak included eight opposed to the prospect of a long-term lease of the city’s parking and 30 people in favor of it.
Project Manager Fran Halbakken described the bidding for control of city parking operations as a competitive process, where the City Council whittles down the number of potential parking operators, eventually finalizing a term sheet agreement with a single operator.
The plan to turn over the city’s public parking assets to a private party – in return for an upfront payment of an estimated $185 million to $240 million – has come under fire since the idea was first floated by the Think Big Committee in November.
“The people who want the arena should pay for it,” Sacramento resident John Bloomer said during public comment. “Let them do it. We think people will be further inhibited from coming (to downtown) because the parking rates are going to go up.”
The proposed 50-year lease of the city’s parking operations is expected to be the cornerstone of a complex financing plan to build a new arena at the downtown railyards – and prevent the Sacramento Kings from relocating.
Thirteen bidding teams responded when the city began the search for parking lessees, according to the city staff report. The list of potential bidders was narrowed to 10 by staff and outside consultants before being presented to council members Tuesday.
Some of the criteria used to evaluate potential bidders included financial strength of the bidding team, sources of capital, ability to make an upfront payment and each bidding team’s strength and experience as a parking operator.
Tuesday’s vote doesn’t commit the city to continue the process – but it does indicate council members’ willingness to take the next step.
“This isn’t a vote for the arena or against the arena. There is no money exchanging hands yet,” Sheedy said after the vote.
According to the staff report, before the City Council can proceed to actual lease proposals, it will first need a financing plan in place for the entertainment and sports complex, and it will need to identify enough revenue to make up for initial parking revenue losses from the city’s general fund.
There will also need to be a budget for the consultant costs for the process of finding a parking operator, according to the report.
Sheedy called for a “much more in-depth” process for public outreach as the council starts to take a closer look at the bidders list.
“People really need to see what we’re doing,” Sheedy said.
Tuesday’s vote comes on the heels of a 5-4 vote Feb. 7 against putting the parking lease plan on the June ballot.
“Today (we took) a significant step,” Johnson said. “We voted unanimously to do something mostly ceremonial today, but it puts us in a position for Feb. 28 to be all in.”
Halbakken said the next step in the process will be for city staff to further evaluate bidders to reduce the list, and to begin to establish the parameters of financing terms for a potential lease.
Melissa Corker is a staff reporter for The Sacramento Press. Follow her on Twitter @MelissaCorker.