A day after Pittsburgh legislators shot down a 50-year lease of their parking assets, another parking concession opportunity has come to market in the US.
The New Jersey Transit Corporation, New Jersey’s public transportation agency, is seeking private investors to bid on a long-term concession of parking lots located next to its bus and rail facilities throughout the state.
The concession will give the private investor the exclusive right to operate the parking lots and collect their revenues over several decades. A term of 30 to 50 years is being contemplated for the contract, according to a request for qualifications issued by the transit agency today.
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Some of the spots bring in millions in revenue each year, while others are free. New Jersey Transit said it aniticipates the free spots will be converted to paid spots as part of the concession.
Parking leases have been an attractive source of revenue for cash-strapped government in recent years. However, in many places the deals have proven difficult politically to bring to completion. To date, Chicago is the only big municipal government in the US to carry out such a transaction. It leased its 36,000 parking meters for $1.16 billion in 2009.
City officials in Harrisburg voted down a similar deal for their parking assets in 2008 and earlier this year aldermen in New Haven, Connecticut postponed action on a 25-year lease of their parking assets. And just yesterday, the Pittsburgh city council voted down a $452 million concession for their parking assets in a preliminary vote that doesn’t bode well for the deal’s final passage.
It is unclear how the political landscape in New Jersey will influence New Jersey Transit’s bidding process. Former Democratic Governor Jon Corzine drew heavy criticism when he proposed leasing the state’s turnpike in 2007. However, current Governor Chris Christie, a Republican, has championed belt-tightening measures across the state and even asked for a list of privatisation proposals that could help the state’s agencies function more efficiently.
Mailed responses to New Jersey Transit’s request for qualifications are due 12 November.
However, to be eligible for the qualification, interested firms must register their identities with the agency’s bid desk by 20 October, according to an email from New Jersey Transit acting director of contracts John Wasilak.
Chicago-based advisory firm Scott Balice Strategies is acting as New Jersey Transit’s financial advisor on the deal.