For Lease or Sale: Parking Garages
No, this is not an advertisement from the City of Pittsburgh, who spent much of 2010 debating a long-term lease of Public Parking Authority assets to solve its pension woes. Instead, it is a recommendation made by the Act 47 coordinator for the state’s capital city, Harrisburg, which faces a significant debt burden due largely due to its involvement with a trash incinerator. Annual debt service is $18 million a year and there is $220 million outstanding on the facility.
Avoiding a Chapter 9 bankruptcy filing, according to the Recovery Plan, requires the patience of the parties the City owes money to, a consensual debt solution, and a reopening of the three labor contracts the City has.
With a structural operating deficit 19 jobs are slated for elimination and the only way out of the debt problem is to sell the incinerator and sell or lease the assets of the Harrisburg Parking Authority. We wrote in a blog last October about a plan for Harrisburg that would have involved issuing new debt to help the City with its incinerator issue. Now it appears the 8,300 plus spaces and possibly 1,200 metered spots could go up for sale or lease. That’s about half the spaces that would have been involved in a Pittsburgh lease proposal. Harrisburg also has a revenue sharing arrangement with its Parking Authority akin to the one here in Pittsburgh, with the HPA transferring anywhere from $3.5 million to $4.0 million per year to the City in the past few years.