AGENDA #2b
BUDGET WORKING PAPER
TO: W. Calvin Horton, Town Manager
FROM: Mary Lou Kuschatka, Transportation Director
SUBJECT: Response to Council Request regarding Parking Revenues since Rate Increase
DATE: April 2, 2003
This memorandum provides information on the Town’s off-street parking operations and revenues generated since implementation of the off-street parking rate increase.
At the February 28 Budget Work Session, a Council member requested information regarding current revenues generated at Lot #2 and the Wallace Parking Deck.
A review of revenues for parking operations for the first eight months indicates that off-street revenues are generally less than original budget estimates and yearly projections. Based on this review, we believe that short-term parking in the parking deck has decreased slightly compared to last year. We believe that the decline could be influenced by the increase in off-street parking rates adopted for the current year, greater use of the fare-free bus service by students, and general economic conditions. However, we are not able to determine which of these variables may have the greater impact on off-street parking.
For off-street parking operations, we believe overall revenues this fiscal year could be as much as $50,000 less than amounts originally budgeted based on trends in the first eight months. However, we expect this shortfall would be offset by actual expenditures, which in normal years are as much as $50,000 less than budgeted amounts. With expenditures as expected for the first eight months, we believe that off-street parking operations would be balanced at year-end, but there would be no additions to accumulated fund balance as in the past several years.
A Council member asked what our current revenues would be if we had not increased our rates. While we cannot be certain which factors may have influenced the decline in short-term parking in the deck the most, we believe that we can make reasonable assumptions that the rate increase and the peak rate charges remain a factor.
The weather also played a significant role in revenues for the deck in December. We were unable to operate for four days due to loss of electrical service, and we experienced more inclement weather in January-February 2003 than in 2002. This had a greater effect on the parking deck than it did on Lot 2. Electrical service was restored to Lot 2 within a day. Also, historically Lot 2 has had higher occupancy due to its convenience.
The attached summary includes monthly revenue generated during January and February of the current year and last year. Fare-free bus service was in effect for both periods.
Current Year Last Year Difference
Deck Revenue (January) 44,219 40,025 4,194
Lot 2 Revenue 35,740 31,703 4,037
Deck Revenue (February) * * *
Lot 2 Revenue 36,747 34,857 1,890
Total Revenue 116,706 106,585
Total Amount of Increase 10,121
Difference/Total Revenue (Current Year) = .0867
Based on the figures above, we believe that if we reduced our current rate to the previous rate, our current revenues would decrease by about 8%.
*Deck revenues for February excluded, the difference between the current year and last year appear anomalous. We assume this was due to outside factors, which affected normal operations.
Lot 2 Revenue 441,507 374,304 67,203
Total Revenue 967,198 883,548 83,650
Difference/Total Revenue (Current Year) = .0864
Based on the figures above, we believe that if we reduced our current rate to the previous rate, our current revenues would decrease by about 8%.