A city with budget woes, many of them related to long-term debt, comes up with a plan: why not lease or sell the parking structures owned by the city (or a related city authority) and use the proceeds to pay off the debt?
This sure sounds a lot like Pittsburgh, but as we’ve chronicled in earlier blogs and a Policy Brief it is Harrisburg that is looking around for dollars. After this past week in which the Mayor vetoed a revised budget and still has to contend with a $4 million shortfall but did nothing to address the debt related to an incinerator owned by the Harrisburg Authority but guaranteed by the City of Harrisburg the possibility of asset sales became more real.
According to published reports the Mayor of Harrisburg "has supported looking into the sale or lease of certain city assets – including parking garages, City Island and McCormicks Island – to help retire the debt." Now the City seems prepared to hire outside experts to see how much money the assets could bring in.
There will likely be more cities and local government that might be hoping that their parking structures can deliver quick fix savings for debt and legacy cost problems that are staring them in the face. Unfortunately, this will be happening in retrospect (looking for money to close budget gaps) instead of prospectively (making a judgment as to whether parking or other municipal functions are a core function that ought to be moved to the private sector).