This a key week for the debate over how the City will proceed with its garage plan: City Council is expected to vote today on whether to hire its own consultant to study the options on the table (a lease, a revenue bond, a transfer of ownership to the pension fund) and by Friday interested parties in the lease proposal are to submit responses to a RFQ handled by the Parking Authority.
Three legal opinions on the proposed alternative of transferring ownership to the pension fund have come forth, and have argued that there are major problems with the plan. Earlier this month we wrote a blog about questions that this alternative plan raised.
The legal objections? That the Authority cannot give up ownership without first satisfying its debt, that state law on pensions would prohibit it ("operation of a private business is not an investment security and would be a clear violation of the restrictions of the Municipal Pension Recovery Act") and that owning real estate would violate the commitment to investment diversity for the City’s Comprehensive Municipal Trust Fund (the CAFR says that an "allocation of 65% equity, 35% income with a variation of 10% above or below these targets for each classification").
Despite the objections the proponents for the alternative plan have indicated that they will continue to pursue the idea.