Guest Column

In a letter dated July 18, Councilwoman Jennifer Beck and Councilman John Curley have distributed inaccurate information regarding the parking improvement initiative presented at the July 11 council meeting. I have reviewed their letter with staff and have prepared the following response.

The inaccuracies begin with the heading “$12 Million Taxpayer-funded Parking Garage.” The fact is that the bond ordinance proposed is for $11.6 million and the costs will be totally funded by the parking utility from revenue generated by the users of parking, the ratepayers. No tax dollars will be used for this initiative. Further inaccuracies are as follows:

• The proposed parking garage pro forma and all budgetary projections were not prepared by Mayor Edward McKenna, but rather by borough staff with input from members of the parking committee after consultation with the borough auditor and bond counsel.

• The parking improvement proposal does not include parking meters in front of residential properties and this was never a part of this proposal. In fact, the proposal includes amendments to the existing parking ordinances to create resident-only zones on residential streets.

• There will never be a $1 million deficit per year under any possible iteration of the parking pro forma, including those scenarios proposed by Councilwoman Beck and Councilman Curley.

• The current financial pro forma is not the same as proposed in 2001. The increase in the estimated cost of the garage is due directly to the increased cost of structural steel and concrete.

• The pro forma, as presented to council, anticipates the parking garage to be in use 24 hours a day, seven days a week, 365 days a year from the first day of operation. However, the anticipated revenue from this garage is only based on 80 percent occupancy for eight hours a day, 360 days a year. There is no deviation in the anticipated usage from year one through year 20. This estimated usage is very conservative, and deemed conservative by various professionals in the parking operations profession, the borough’s parking manager, the borough’s parking consultant, and four independent parking operations managers (Summit, Morristown, Montclair and Princeton).

• The budget increases in expenditures for the proposed garage were included for 2006 in the proposed budget. The budget in total is anticipated to increase 4 percent annually. The hours of operation will not increase over the years. To the contrary, they will remain constant during the entire 20-year pro forma.

• Scenario No. 1 as set forth in their letter is factually incorrect and completely without basis or merit. The proposed parking solution is a comprehensive solution, and that includes a parking garage to provide long-term parking, the installation of additional parking meters to better manage short-term parking, and the creation of residential permit zones to discourage commercial parking in residential areas.

The issues are not mutually exclusive. However, if the scenario as presented in Councilwoman Beck’s and Councilman Curley’s letter were the case, and the terms outlined in the scenario are carried forward during the full 20 years of the pro forma, the borough would still generate more than $14.8 million of surplus during 20 years.

To speak to the specific years they state would run a deficit under their scenario, in 2007 the deficit would be $54,762.34; in 2008 the deficit would drop to $50,602.44; and in 2009 the deficit would drop to $11,211.16. However, inasmuch as the parking utility would generate a surplus in 2006 of $160,140.20, this amount would be enough to cover the deficits in years 2007-2009 and still retain $43,564.26 of surplus. The taxpayers would pay nothing under their scenario. The utility would cover all expenditures with no negative effect to the taxpayers.

• Scenario No. 2 appears to be a complete fabrication and factual misstatement. To the contrary, the borough would generate at the least a $313,201.60 surplus in 2007, and $27,717,880.44 during 20 years.

• The parking garage on its own will cover its debt service and still generate $10,537,280 of surplus above all expenses and debt service during 20 years, not the $1 million deficit as stated by Councilwoman Beck and Councilman Curley.

• There is not presently $1 million generated by existing meters to be used for tax relief. The total parking utility revenue is offset by expenses including existing debt service. The surplus generated in 2004 was $316,396.

• At the present time, the residential properties do pay 62 percent of the property taxes. However, residential property makes up 83 percent of the taxable parcels. The commercial and industrial complexes pay 30 percent of the property taxes in the borough, yet make up less than 14 percent of the taxable parcels. Thus, it appears the commercial and business property owners pay their fair share.

The above rebuttal points are backed up with supporting documentation, which [was] attached hereto. The letter circulated by Councilwoman Beck and Councilman Curley did not provide any supporting documentation.

Improvements to the borough parking system are needed to address the need for long-term parking and to eliminate the increasing spread of commercial parking into residential areas. The proposal as submitted will address these issues, provide funding for the cost of these improvements, and will provide an ongoing source of additional revenue to the borough.

Arthur V. Murphy is a Red Bank councilman and chairman of the parking committee