City View: Mixed-use parking facility is a win-win for businesses and taxpayers

I have been hearing some concern that the City’s proposed mixed-use downtown parking facility at Fifth and Walnut Streets would be unfair to taxpayers and local businesses.  The “buzz” is that public tax dollars would be used to build a property tax – exempt project that would be in direct competition with local developers.
With all due respect, I disagree.  This project responds to a need for more downtown parking and for reasonably priced retail/commercial space.  When it is built, we’ll have an attractive public asset that helps grow business instead of a single-purpose concrete box.
No general revenue tax funds will be used for either the 17,000-square-foot commercial space at street level, or the seven-story parking structure above it.  Funding for the entire project will come from our parking utility, which functions as a City enterprise fund. Special Obligation Improvement Bonds for the project will be repaid through parking revenue generated by parking facilities and meters.
The addition of street level retail/commercial space is a Council directive, and I support that plan.  It is the most efficient and aesthetically pleasing use of scarce, street-level space in the downtown district.  While the details still need to be ironed out, the City will develop a “payment in lieu of taxes” on the retail portion of the project.
In addition, the City will not use parking revenue to subsidize rent on the commercial space.  Long-term management and marketing will be bid out to a “master developer” that would be responsible for setting appropriate rates. Businesses operating in the facility will pay market value for the commercial space and the same taxes as any comparable business.
Attracting small businesses along with their employees, clients, suppliers and innovative ideas will help keep our downtown vibrant and successful. By adding commercial space on street level with upper level parking, the City is incorporating recommendations by the Sasaki Plan to use downtown land efficiently by building up instead of out. Garages also allow surface parking to be developed into more productive uses of space.
While the retail space is designed to avoid the sterility often associated with parking structures, the facility will also provide a secure, underground lot for the Police Department and 661 upper level parking spaces, which are desperately needed.
The City currently has waiting lists for permit parking in all but one City garage and one surface lot, and there is no covered parking available at this time.
The Fifth and Walnut location has been in the Downtown Master Parking plan since 2001.  The expansions of City Hall and Boone County Courthouse will further increase parking demands for customers and employees, as well as City fleet vehicles that are currently located in leased spaces throughout the community.
The City holds no monopoly on the construction of parking facilities.  Several individuals, churches and businesses lease their downtown lots and set their own rates for parking space.  If developers thought they could profit from building a parking garage, I believe they would seek to do so.  The truth is, that while the City’s parking garages are a necessity, they are not profitable.  Our parking utility uses parking fees and meter revenue to cover the cost of the garages.
I’ve also heard some concerns about the size of the proposed facility.  The City originally considered building a smaller parking garage at Fifth and Walnut and adding a two-story addition to the parking plaza between City Hall and the Courthouse.  New earthquake codes have made the addition to the parking plaza cost-prohibitive.
We could build a facility with fewer levels, but construction costs per parking space drop significantly with each additional story.  Furthermore, a smaller facility will leave us tapped out on space much more quickly.
Although our economy is soft, prevailing wages and costs of materials will be even more expensive tomorrow, and our needs will be greater.  Change and growth will inevitably come to our downtown.  We must be efficient in how we use our scarce existing space and we must plan for that future growth.  I believe it would be penny-wise and pound foolish to do otherwise.