Parking lease is in city budget
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Pittsburgh Mayor Luke Ravenstahl released a $453 million preliminary city budget Wednesday that assumes the approval of a controversial proposal to lease the city's parking garages and meters to outside investors.
The move surprised city council members and union leaders, who had expected Mr. Ravenstahl to release a 2011 budget with nearly $30 million in service cuts. Instead, the budget lists no major tax hikes, no additional borrowing and no mass layoffs.
"It seems to me that the mayor -- despite what he said earlier -- has made the choice to ensure that the budget at least closer reflects reality," said Councilman Patrick Dowd. "I'm not suggesting that we go with the parking plan, but extra cuts and taxes are not going to be necessary."
Mr. Ravenstahl had previously said he planned to present a budget reflecting the gloom that would descend on the city without the $452 million parking lease, putting significant pressure on city council to vote for the contract.
Before council reviews Mr. Ravenstahl's budget, the document must be accepted by the Intergovernmental Cooperation Authority, the state board that oversees the city's finances.
Last year, Mr. Ravenstahl also presented a budget assuming the use of not-yet-approved funds: His proposed college tuition tax, which met fierce opposition and was never enacted. The ICA sent that budget back for revision.
Unlike the tuition tax, the parking lease would not directly contribute to the city's general fund, but it would enable the city to free up money that would otherwise be needed to boost the flagging pension fund.
State legislation would allow the city to increase parking taxes from 37.5 percent to 40 percent, but again, assuming that a parking lease is approved by the city. That parking tax increase is also reflected in the preliminary budget, bringing the city an extra $5.6 million in revenue.
Monday, a group led by J.P. Morgan Asset Management and LAZ Parking bid $452 million for the 50-year parking lease, an amount Mr. Ravenstahl said greatly exceeded his expectations.
First Published September 23, 2010 12:00 am
