Parking dilemma remains
State law prevents the city parking authority from building a surface parking lot for a new hotel downtown.
Mayor Tom Donaldson said Tuesday that a 1947 state law says that parking authorities can only build lots and structures primarily for public use.
“It was the legal opinion of their solicitor that (the parking authority) can't be involved as a public authority because the majority of spaces must be for public use,” Donaldson said. “This project would go beyond the scope of the law, so the parking authority will not be building a surface lot.”
Robert Stock is the solicitor of the parking authority, which at its meeting Sept. 24 approved an agreement to build a 75-space parking lot on South McKean Street for the proposed Marriott Springhill Suites hotel. The two projects are part of the Centre City project, which also includes a Rite Aid pharmacy on Main Street, which is expected to open this fall.
City and parking authority treasurer Jeff Smith said that Stock in the past week had discovered the law. He said the discovery came at the end of an “exhaustive” study to make sure that the project could be done.
“Going back to 1947 is going back very far,” Smith said.
He said that the law was not conclusive as to whether the authority could not do it, but he said it raised plenty of issues.
Original plans for the project called for a 225-space parking garage to accompany the hotel, with some spaces designated for public parking.
However, the authority opted for the surface lot, estimated at one-tenth the $4.5 million cost of a garage due to financial concerns.
The switch from a parking garage to a surface lot angered city business owners, who are petitioning for a garage to be built.
Smith said there is a chance that the garage could be built with the hotel leasing some spaces as long as the garage primarily is for public use. However, he said he is not sure if anyone has defined what percentage of spaces have to be public.
The parking authority is suggesting the city redevelopment authority help pay for the garage.The parking authority says the redevelopment authority owes it 137 spaces stemming from a 2007 agreement in which the parking authority gave up the parking lot at the corner of East Jefferson and South McKean streets for the Centre City project.The parking authority sent a letter to Donaldson this month asking him to intervene and request that the redevelopment authority pay for the 137 spaces.Donaldson said the idea is to have the city redevelopment authority, which will be about a 40 percent owner of the hotel, finance at least part of the garage. However, Donaldson said he doubts that could happen because of the redevelopment authority's struggling finances with Kelly Automotive Park and the Penn Theater.The mayor asked the redevelopment authority if it could contribute $65,000 per year to the parking garage.Donaldson said Art Cordwell, the executive director of the redevelopment authority, sent him a reply via e-mail saying he would recommend the redevelopment authority to “declare insolvency and turn all projects over to the City and the Parking Authority” if that were to happen.Donaldson provided a copy of the e-mail to the Butler Eagle Tuesday night after the council meeting.“The problem is the redevelopment authority couldn't afford that if it wanted,” Donaldson said.Donaldson said he is meeting with members of the authority this week to discuss the garage.Smith said the comment about insolvency is troubling.“It's very disappointing that the executive director would talk in terms of insolvency,” Smith said. “It certainly doesn't instill much confidence in the authority.”
The city parking authority could build the garage, but that likely would require the city to lower the annual contributions the authority makes to the city to cover the increased debt service. The authority now pays the city more than $160,000 per year.Donaldson said another option would be to have the city pay for the garage with a bond issue, but said the city may not be in a position to do so financially.Donaldson said the city has a challenging budget for 2015 to balance this year.“There's a long way from where we're at and getting the budget through,” he said. “Our expenses are cut as far as we can cut them.”Donaldson said the city could raise its debt service tax to pay for the garage, but said he would oppose it.“I'm not willing to raise taxes to build a parking garage,” he said. “Why should people in houses pay for businesses that need parking.”Councilmen Richard Schontz Jr. and Cheri Readie both said at the meeting they understood the challenges facing the city financially, but they still support either a parking garage or a parking deck.Readie said she believes the garage is not a financial risk to the city.“I think the garage can pay for itself,” she said.Readie said the city last year developed a plan to pay for the parking garage with a bond issue through PNC Bank. Council last December approved to back up to $6.5 million on the bond that would build the garage. Readie said the numbers for how the garage would support itself were worked out.“Somehow those numbers have changed,” Readie said. “Council was unaware of that until it hit the news.”Readie said she favors the garage because it supports businesses.She said if parking is taken away from the block, there will be nowhere for business employees or customers to park.Readie said the city needs to host a meeting with the redevelopment authority and the parking authority to figure out what will make the garage work.Schontz agreed the parking needs to be figured out so that the hotel can be built.“All three need to work together to figure it out,” he said. “The project needs to move forward. I support building the parking garage, whether it's two or three stories.”Donaldson said there isn't a good answer to fix the parking in the project's zone due to the city's inability to bring in new forms of revenue.“We can't pull rabbits out of hats,” he said.The parking authority will meet at 5:30 p.m. today in the city council room at city hall.City council will meet at 7 p.m. Thursday.
