Faculty challenges parking privatization option at Ohio State
Published: Sunday, March 25, 2012
Updated: Saturday, June 16, 2012 00:06
Members of campus faculty groups at Ohio State have spoken out against the university’s proposal to lease its parking assets to a private operator for a one-time, up-front cost at a minimum $375 million.
Geoff Chatas, university chief financial officer, said OSU is preparing the request for proposals, phase three of the five-step process. A request for proposal occurs when the university invites prospective third-party vendors to submit a proposal concerning a specific commodity, which in this case would be parking.
“We are working towards issuing the formal RFP at the end of April, but this will be subject to everyone having a chance to have input into the process of drafting the document,” Chatas said.
OSU Faculty Council proposed a resolution opposing parking privatization, explaining reasons why the university should choose to keep the rights to its own parking.
Paul Beck, an OSU professor in the political science department and member of the faculty council, said one reason many faculty members oppose the change is due to the private operator being permitted to raise parking prices by 7.5 percent each year for the first 10 years, or the price of inflation, whichever is higher.
This rate is much higher than the average 4.8 increase for an ‘A’ permit from 2003 to 2012, according to the resolution.
“The more I thought about it, the more I thought this is unfair,” Beck said. “Not only to faculty and staff, but for students as well because they are paying double. First they are paying for their tuition, but then they’re being hit again by increasing parking prices.”
OSU officials have said the profits the university plans to make from privatizing its parking will be reinvested into the university’s academic core.
Chatas said the administration has taken notice of the faculty opposition and will continue to work with them to explain the benefits of the proposal.
“Since last fall, we have been having robust discussions with faculty to address their issues and explain how pursuing innovative financial strategies will help the university achieve its goals of becoming one of the nation’s top public universities,” Chatas said. “It’s all about enabling us to hire more faculty, generate more student scholarships and improve our campus.”
Enrico Bonello, an OSU professor in plant pathology and member of faculty council, said faculty council members want the administration to make them more involved in the process and informed of actions being taken.
“The administration keeps telling us the same things that are not making sense logically and it’s very difficult for us to accept,” Bonello said. “We just feel like we’re being talked down to.”
Beck said many faculty council members feel they’ve been shut out of the process.
“We teach our students to be open and objective and I think the university should do the same,” he said. “We just wanted to get information that we need to have to be able to make this decision and they’re not giving us that information.”
Although OSU would receive a one-time payment, the university would still be responsible for paying off its parking garage debt and paying for the Campus Area Bus Service, among other parking costs, according to the resolution.
“According to the current framework and parameters, there really isn’t any cash available for investment in the core, unless you take it from other parts,” Bonello said.
Beck said he understands the university’s efforts to try to profit from parking, but the profitable benefits are nonexistent.
“As I began to dig more deeply and listen to the administration talk about what it’s going to do with the money, I realized they are trying to spend the proceeds twice and they can’t do that of course,” he said.
University officials will not share with faculty members where the $375 million minimum originated from and denied public records requests, saying it was a trade secret.
President E. Gordon Gee told The Lantern in February some of the proposals the university has received “far exceed” $375 million, the benchmark for proposals.
“The initial question that was asked by a lot of people would be would we even get our minimum,” Gee said. “Our minimum concept was about $375 million. And several of the proposals far and away exceed that. So it’s being now analyzed and we’ll move from there.”
According to the resolution, the private operator would receive all parking revenue, which is valued at about $28 million for fiscal year 2012. The vendor would then be responsible for parking expenses that total less than half of revenues. For fiscal year 2012, expenses are estimated between $9 million and $11 million.
Bonello said he also understands why the university is looking to parking for revenue.
“I understand the predicament that the university finds itself in terms of finding cash, because we all know how much funding is being cut and all of that,” he said. “It’s just that I believe that this is the wrong way to go about it.”
Another concern of the faculty council was the Department of Transportation and Parking Services employees, who will be given the opportunity to interview with the third-party vendor, but not guaranteed jobs.
“(The administration) is acting like they are only interested in the cash flow and not what’s going to happen to these people,” Bonello said. “Just total disregard with what happens or what that means to actual people.”