Parking firms have Chicago ties
Share with others:
When Pittsburgh proposed leasing its public parking facilities, the city became a magnet for a passel of firms -- many of them connected to Chicago by blood, politics or business -- that pursues similar deals around the country.
The firms may be partners in one city, rivals or referees in the next. The fluid nature of these business relationships hasn't raised many eyebrows in Pittsburgh, but it's reportedly raised a red flag in Los Angeles, one of the cities now considering a parking lease.
Pittsburgh finance director Scott Kunka said officials here have been careful to make sure that firms participating in the Pittsburgh project have no conflicts of interest.
"We had those questions ourselves" and posed them to advisers at the Downtown law firm K&L Gates, who produced "voluminous" guidance, he said.
In Pittsburgh, the winner of a parking lease would receive an estimated $2.4 billion in parking garage and meter revenue over 50 years, according to a City Council study. In the short term, however, other firms stand to share millions of dollars in commissions and advisory fees.
Chicago officials pioneered the parking lease last decade with a pair of long-term contracts to Morgan Stanley's infrastructure investment arm, which brought in Connecticut-based LAZ Parking to operate four garages and about 36,000 meters.
When Pittsburgh Mayor Luke Ravenstahl proposed leasing 12 parking garages and several thousand meters -- hoping to generate revenue for a troubled pension fund and save it from state takeover -- a high-powered, Chicago-linked crowd landed here.
The participants include:
• Morgan Stanley and Co. infrastructure market and acquisitions team, to be paid about $4 million if the city carries out the project. The team included William Daley Jr., nephew of Chicago Mayor Richard M. Daley.
• Katten Muchin Rosenman, a Chicago-based law firm that helped the Daley administration in the parking meter deal and is among the lawyers advising Pittsburgh. According to Chicago news reports, Terry Newman, a partner at the firm, is a friend of Mayor Daley.
If the lease goes through, the firm will bill the city parking authority hourly rates ranging from $480 to $620 for each lawyer involved in the project. No bill will be provided until next month.
• Scott Balice Strategies, a Chicago-based financial consulting firm that crunched the numbers for the Pittsburgh project. Before helping to found the firm, Lois Scott served on a budget advisory panel to then-incoming Illinois Gov. Rod Blagojevich, who was forced from office last year amid allegations that he tried to sell President Barack Obama's Senate seat. Two of the firm's executives have worked for Mayor Daley.
First Published October 4, 2010 12:00 am
