Privatizing the City: Spotlight on Chicago Parking Meters

If you're new to Chicago, you might wonder why there's so much hubbub over the parking meters. Chicagoans across the city have been fuming about the system ever since the city sold its meters to a private company in 2009. Here's why.

Current Status
Meters have sprouted up in neighborhoods that until recently were known for ample free parking. Since the new meters are automated, drivers now pay for parking every day of the week – no more free Sundays. Why the change?BackgroundFor the last few years, our cash-strapped city has been looking for quick financial fixes. One increasingly used solution? Privatization. For better or worse, giving up long-term control of what has traditionally been a city service means an initial cash windfall.

For example, in 2005 the city leased the Skyway toll road to the Skyway Concession Company for $1.83 billion, meaning the privately held company is responsible for maintenance but gets the revenue from the tolls – for the next 99 years.

The 75-year parking meter lease with Chicago Parking LLC (managed by LAZ Parking) is similar in that the city got a lot of money up front, but the transition has been messy and expensive.

Pros
Proponents say privatizing the meters provided the city with a much-needed source of revenue in a rough financial time: leasing out the meters brought in a cool $1.16 billion.

Mayor Daley told the City Hall press corps that it was a "very, very responsible agreement," and that investment firm William Blair & Company's analysis had shown the open market value as anywhere from $650 million to $1.2 billion – meaning that the city got the high end of the deal.

Cons
Critics say that the mayor and his supporters acted behind closed doors to negotiate the deal, and that the results shortchanged the city both in terms of the sale price and the impact on the public. The city's Inspector General, David Hoffman, claims the deal was worth more like $2 billion.

As far as the public interest goes, many critics believe the new meter locations and hiked up rates will decrease traffic to small neighborhood businesses as well as clog up non-metered side streets.

Where It Stands
Basically you can expect to cough up more money in more places – metered parking now costs about twice as much as earlier rates. One perk: the new machines take credit cards, so no need to scour the backseat for change any more.

But the drawbacks for the average Chicagoan seem to outweigh that one convenience. In addition to paying more, you'll find that there's often just one machine to a block – a headache and even a hazard in inclement weather.

Good news? There's always the CTA...hopefully.