Note: This is the second article in a series that will appear in the Hoboken Reporter explaining how different aspects of modern Hoboken, including agencies, situations and places, got to be the way they are today.
Although recently providing fodder for jibes from politicians, radio disc jockeys and even Bill Cosby, the parking problems in mile-square Hoboken did not appear overnight. For several decades, finding a parking space in the city has been an uphill battle for many residents.
In the 1960s, parking became a pervasive enough problem that the city created the Hoboken Parking Authority (HPA), an independent agency to specifically deal with the nuances of parking. The HPA is one of the most talked about, and often reviled, city agencies. The 33-year-old entity’s colorful history is worth a look, especially since recent rumors and controversies indicate that it may be in jeopardy.
The HPA’s origins
In 1969, the Hoboken Parking Authority was founded by city ordinance to facilitate the creation of garages and new parking spaces in the city. Since 1982, the quasi-governmental, autonomous agency has not received a single penny of city tax dollars. Instead, it operates on money it receives from meters, revenue from its garages, towing fees and interest on cash funds. A seven-member volunteer board oversees it, and members are appointed by the mayor and approved by the City Council.
The City Council voted in 1969 to create the HPA. Municipalities in the 1960s and 1970s were following a trend to create parking authorities rather than handle parking issues internally.
In the beginning, the HPA got started by floating $8.5 million worth of bonds to build three parking garages on Hudson Street, commonly referred to as garages B, D and G. The three garages were finished in 1975 and have a combined total of 1,800 spaces. All three are still in operation today, and they currently have empty spaces for rent.
The city had to make a guarantee in order to float the bonds. They said that they would make up any debt on the bonds that the HPA could not pay. The agreement was entered into in 1970.
At first, the three new garages struggled to attract business. Demand was so limited that Garage B remained closed, locked and empty for nearly half a decade. One reason for the initial lack of interest in the 1970s was that less housing was built in the area of the lots than the city had originally anticipated. The city originally planned to build three 25-story Marine View Towers, but only two were built, resulting in fewer cars to fill the spots and less revenue to pay the debt.
The lack of interest in the garages caused serious problems for the agency. From 1973 to 1982, the city paid approximately $4.2 million in debt service until the HPA was able to pay for itself again. In 1983, the HPA recorded a profit for the first time. But because of the initial agreement, it never had to pay the city back for the $4.2 million.
Since 1982, the Parking Authority has turned a profit every year except 1985. That year, it suffered a slight loss, according to Parking Commissioner Donald Pellicano, who served as the Authority’s treasurer for 20 years and has served on the board since 1975. The agency now owns $43 million in total assets, according to HPA records.
The agency runs on an operating budget of more than $7 million. In 2001, the HPA generated $7.98 million in revenue and had $7.28 million in expenses.
‘Cash cow’ for the city
When the HPA started turning a profit, many city officials started to look toward it as a possible source of revenue that could be used to plug the annual municipal budget gaps. That way, the city could avoid raising taxes and outraging voters.
Although the 1970 agreement stated that the HPA would never have to return any of the money the city paid out on its behalf, City Council members sometimes felt that it was the HPA’s "moral obligation" to return some of the money.
It is also important to note that the HPA does not pay any property taxes on its garages and other assets, since it’s a quasi-governmental agency. This has often been used as justification for elected officials to ask the Authority for money.
When Mayor Anthony Russo was elected in 1993, he was greeted with a large budget deficit, with millions of dollars in payments having been deferred by the previous administration, according to state-approved audits. The size of the gap was a matter of debate, but there was one to fill, and Russo found that the HPA was an invaluable source of revenue.
In 1994, the City Council voted on an agreement with the HPA in which the agency would give the city millions of dollars in PILOT payments ("Payments in Lieu of Taxes") over several years, even though they weren’t required to pay the city any kind of revenues or taxes. At the time, the city’s auditor defended the deal, saying, "We helped the Parking Authority in their time of need. Now it’s time for the Parking Authority to help us in our need."
This started a trend that continued into the current administration. Last year, Mayor David Roberts’ administration plugged in, without asking the HPA first, $2 million in payments from the HPA into the city budget to fill a gap. This started months of wrangling and arguing that even angered Roberts’ new appointees on the HPA. Eventually, the two sides came to a compromise. Mayor David Roberts agreed to sell the HPA a plot of land on 11th Street and Willow Avenue for use as a parking lot, and the HPA agreed to give the city $1.5 million.
According to HPA records, in the last 12 years, the HPA has given more than $15 million to the city the form of Payment in Lieu of Taxes (PILOT) and land acquisition payments.
Where does the money come from?
There are a lot of misconceptions floating around about how the Parking Authority earns money. The Parking Authority is responsible for writing tickets for expired meters and for violations of the city’s resident parking program, but the HPA does not earn revenue from parking tickets. The entire sum of that money is split between the city and the state.
The HPA does receive money from the enforcement of the residential parking program when a car is towed. For each car the HPA has towed for resident parking regulation violations, it gets $40. For cars that are towed by police because of traffic and parking violations (such as parking by a fire hydrant), the HPA gets no money. HPA Chairman Frank Turso, a seven-year veteran of the board, said that the city and not the HPA reaps the benefits of the HPA ticket-writing. "[The tickets that HPA employees write] are a big wind-fall for the city," said Turso on Friday.
The HPA does get to keep the fees from resident, visitor, business and temporary parking permits, but according to one HPA official, the resident parking program and ticket enforcement effort are run at a substantial loss to the HPA. Residents can buy a year-long parking pass for $10, and business owners and employees can purchase a business permit for $75. Visitor passes are $3 per day.
For the last two years, the HPA has lobbied the City Council to add a dollar surcharge to parking meter tickets to offset enforcement costs, but so far the council has not voted to approve any surcharges.
The majority of HPA funds come from the garages. According to HPA documents, the largest revenue producer for the Authority comes from out-of-town visitors who park in the city’s garages. In 2001, the HPA earned $4.75 million from transient visitors. The garages bustle on weekend nights with people visiting the city’s bars and restaurants.
The HPA also collects fees from Hoboken residents that have monthly spaces in the garages. This generated approximately $2 million in 2001.
Another source of revenue is the change the HPA collects from the city’s meters, which according to the 2002 budget amounts to around $600,000 a year.
The final source of revenue that the HPA receives is interest on its restricted cash fund. According to last year’s budget, the HPA had approximately $22 million in restricted cash. That cash cannot be spent because it is needed to secure the HPA’s bonds, but it can and does accrue interest. In 2001, the HPA earned $600,000 in interest.
What can the HPA do?
The Hoboken Parking Authority actually has little authority when it comes to establishing parking policy. The only real Authority the HPA has is to set the prices in its garages and build garages on the property that it owns. The body can make and has made recommendations to the City Council, but only the council has the jurisdiction to create or modify those programs.
Last year, after a long battle to change the city’s resident parking regulations, the City Council approved new regulations for street parking in March. Those regulations would have reserved one half of each street for resident parking only. But so far, the city has been slow in implementing the program. According to city officials, it has taken some time to produce signs, but the new program will begin "soon."
Those regulations were voted on after a struggle between the city and the HPA involving their direction. Again, two of Mayor David Roberts’ own HPA appointees ended up dissatisfied with the results. They stepped down at the beginning of this summer, citing philosophical differences over the city’s parking agenda.
The city also sets the rates, times and locations for all of the city’s meters, even though the HPA is responsible for enforcement.
916 Garden, and the curse of the Girl Scouts
One of the Parking Authority’s biggest magnets for criticism of late has been the innovative – but continuously delayed – automatic parking garage at 916 Garden St.
The road toward construction of the garage started in 1994 when Mayor Russo needed money to close a large budget gap. That year, the city sold the land to the HPA for $2 million. The site, which was originally deeded to the city by the Stevens family, was already home to the Health Department and well as a few community organizations including the Hoboken Organization Against Poverty and Economic Stress (HOPES), and the Hudson County Girl Scouts.
At the time, residents were calling parking in that area of town "horrendous." After the city and the HPA struck the deal, the HPA owned three fourths of the site, but did not own the portion owned by the Girl Scouts. The HPA was going to demolish the Health Department/HOPES building and move those agencies elsewhere, but they had to figure out how to get rid of the 70-year-old Girl Scout house on the back quarter of the property. Finally, they bought it for $150,000 after telling the Scouts that they were going to build the garage no matter what.
The small size of the site meant that the HPA could not build a regular garage with ramps. Five parking commissioners visited Germany to see an innovation that had barely been tried in the United States – automatic parking, in which cars would be brought into and retrieved from spaces without their drivers entering the building. The commissioners returned impressed with the idea.
In December of 1997, the Hoboken Zoning Board approved a 324-car automated parking facility, which would be the only one of its kind in the country. Critics of the administration expressed doubts, but many residents also were happy with the idea of taking cars in the center of town off the streets.
In December of 1998, the HPA broke ground.
According to the HPA’s contract, the building’s contractors had 365 days to finish the garage.
During construction, a battle ensued that caused much finger pointing, and eventually, work had to stop. One of the project’s contractors accused another of not being able to install the building’s automated system properly. The other contractor returned the volley by saying the first one had installed the building’s steel incorrectly. To this day, each of the many parties involved in the controversy has a different idea of who is to blame. The city’s mayor has reserved comment until a police investigation is completed to see if anything criminal occurred to delay the garage.
Work on the garage resumed last September. Recently, the HPA gave the insurance company that is charged with making sure the project gets completed until Sept. 9, 2002 to deliver a working garage. Robotic Parking Inc., the Florida-based firm hired to install the automated system, gave a press conference two weeks ago that demonstrated a car going into and out of the garage successfully.
New spaces
The other large-scale construction project that the HPA is currently undertaking is the St. Mary Midtown Garage. The new 740-space garage is being built adjacent to the St. Mary Hospital between Third and Fourth streets on Clinton Street. The garage is scheduled to open as early as October.
The lease signing, which was held last Dec. 21, is a public-private partnership in which the hospital donated the bulk of land to the Hoboken Parking Authority under a 99-year lease arrangement. In turn, the Authority will build, own and operate the facility.
Under the terms of the agreement, the hospital will lease 300 of the 740 spaces for the nurses, doctors and staff, and operate the ground floor professional medical office space. The remaining 440 spaces will be set aside for hospital visitors and Hoboken residents.
Fate of the agency
Despite the fact that it has been a source of cash for the city, the problems at 916 Garden St. have resulted in talk of doing away with the autonomous agency and bringing it back under the purview of the city.
Feelings on this possibility are mixed. Recently, one Hoboken activist group, Hoboken Common Sense, sent out an e-mail to members suggesting that because of the agency’s past problems, it should be taken over by the city. "We believe in accountability," said group member Scott Gibson. The group asked for comments from members.
Turso disagreed about the possible take over last week.
"I think we’re headed in the right direction," he said. "Once these two projects open, there will be a much larger flow of parking spaces for Hoboken’s residents."
He added that he believes the HPA has been proactive in the last seven years. "I don’t think we have sat on our hands," he said. "We have been active and have undertaken a number for projects that are going provide new parking. Our main purpose is to provide parking, and if the city thinks they can do better, I wish them luck."
Daniel DeCavaignac, one of Roberts’ appointees who left the agency after haggling with his former ally, said that he believes the city will simply continue to use the agency as a cash cow until it decides to abolish it and loot its coffers.
"It is an easy political whipping boy that raises a lot of revenue for the city," said DeCavaignac in a recent statement.
Is the HPA an out-of-date agency that might be much better off streamlined as part of city government? Or does it just need fine-tuning and less fighting? That question is likely to be asked in the next two months.
Meanwhile, the city has talked of alleviating parking problems by adding angled parking (which was recently done on part of Hudson Street) and by possibly providing parking around the city’s perimeter, with shuttles. Still, it may take some time before the jibes stop, including one on a Bill Cosby sit-com a few years ago in which the entertainer reportedly told his TV daughter that she could get more for her money by living in Hoboken, including a parking spot, an apartment, and a couple of politicians.
To give suggestions or comments for this series, e-mail editorial@hudsonreporter.com.