CITY OF LOS ANGELES INTER-DEPARTMENTAL MEMORANDUM

Transcription

1 CITY OF LOS ANGELES INTER-DEPARTMENTAL MEMORANDUM Date: April 11, 2018 To: The Honorable City Council c/o City Clerk, Room 395, City Hall Attention: Honorable Mike Bonin, Chair, Transportation Committee From: Seleta J. Reynoldl^feneral Manager Department of Transportation Subject: CHANGE IN PRICING STRUCTURE FOR THE HOLLYWOOD AND HIGHLAND PARKING FACILITY (MUNICIPAL PARKING LOT NO. 745) - COUNCIL FILE SUMMARY The Los Angeles Department of Transportation (LADOT) requests a change to the pricing structure for the Hollywood and Highland (H&H) Parking Facility (Municipal Lot No. 745) that will increase annual revenue by an estimated five percent to partially fund a list of proposed infrastructure projects. This revised pricing structure updates Attachment 1 in the LADOT's September 17, 2017 report submitted in Council File RECOMMENDATIONS That the City Council, subject to the approval of the Mayor: 1. AUTHORIZE the LADOT to change the pricing structure for the H&H Parking Facility (Municipal Parking Lot No. 745) located at 6801 Hollywood Boulevard, for five calendar years, 2018 to 2022, as shown in Attachment 1; 2. RECEIVE and FILE the LADOT reports dated November 29, 2016 and September 19, 2017 attached to the Council File ; 3. SUPPORT the LADOT's effort to update the H&H Parking Facility through capital improvement investments; and 4. DIRECT and AUTHORIZE the LADOT to conduct a new parking study in four years to re-evaluate the pricing structure of the H&H Parking Facility to ensure parking rates are competitive and flexible with competing parking facilities within the Hollywood area and to take into consideration operational changes and maintenance costs. BACKGROUND On May 11, 2011, the City Council and Mayor directed and authorized the LADOT to perform a parking study to evaluate the pricing structure of the H&H Parking Facility in four years to ensure that the parking rate is competitive and flexible with competing parking facilities within the Hollywood area (CF ).

2 The Honorable City Council 2 April 11, 2018 In response to that directive, the Transportation Committee (Committee) considered the LADOT's November 29, 2016 report containing a parking study evaluating and recommending pricing structure changes for the H&H Parking Facility at their January 11, 2017 meeting. After discussion of the report, the Committee requested the LADOT staff report back with an evaluation of the facility relative to these areas: parking demand revenue budget potential congestion impacts # parking and travel behavior impacts strategic use of pricing to support future mobility projects # The LADOT submitted a report on this evaluation on September 19, DISCUSSION The LADOT recommends approval of the proposed pricing structure for the H&H Parking Facility to partially fund infrastructure improvement projects to update the H&H Parking Facility into a technologically advanced, 21st Century parking garage. The proposed pricing structure is shown in Attachment 1 with implementation to begin in calendar year This attachment revises the pricing structure contained in the LADOT's September 17, 2017 report. The proposed pricing structure includes a new Morning Special Rate and a new Weekday Monthly Rate to increase weekday parking use of the parking facility as recommended by the parking study consultant in Attachment 2. Attachment 3 shows, the estimated total revenue generated by this change in pricing structure for the next five calendar years, 2018 to 2022, is approximately 3.4 million. The cost of infrastructure improvements for the next five calendar years is estimated at 9.3 million. The LADOT will identify cost savings and surplus revenue through the budgetary processes to offset the 5.9 million difference. Attachment 3 shows a breakdown of the estimated revenue and expenses for the facility. The proposed improvements will replace corroded stairwells, increase lighting and security camera coverage in the garage, update the common area, and provide an overall positive customer experience for the public when they enter and exit the H&H Parking Facility. FISCAL IMPACT STATEMENT The change in rate structure will not impact the General Fund since revenues and expenditures for this facility are credited to or charged against the Special Parking Revenue Fund (SPRF). The proposed pricing structure expects to generate an estimated five percent increase or approximately 3.4 million in revenue for SPRF. SJR/JK/KH:aa:le Attachments

3 ATTACHMENT 1 Proposed Hollywood and Highland Lot 745) Rate Structure Flat Rate Late Night: Hourly Maximum/Daily Retail/Restaurant/ Shop Calendar Year Valet Surcharge Cinema Validation Thursday, Friday & Monthly Parking Maximum Rate Validation Saturday after 10 PM Residential Parking 2018 (Current) 1.00/15 minutes, (4.00/hour) to posted rate to maximum of for the first 2 Hours rates to maximum 2.00 for the first 4 Hours to maximum (New) 2.00/20 minutes, (6.00/hour) to posted rate to maximum of for the first 2 Hours rates to maximum 2.00 for the first 4 Hours to maximum /20 minutes, (6.00/hour) to posted rate to maximum of for the first 2 Hours rates to maximum 3.00 for the first 4 Hours to maximum /20 minutes, (6.00/hour) to posted rate to maximum of for the first 2 Hours rates to maximum 3.00 for the first 4 Hours to maximum /20 minutes, (6.00/hour) to posted rate to maximum of for the first 2 Hours rates to maximum 3.00 for the first 4 Hours to maximum /20 minutes, (6.00/hour) to posted rate to maximum of for the first 2 Hours rates to maximum 3.00 for the first 4 Hours to maximum April 11, 2018 Page 1 of 2

4 ATTACHMENT 1 Proposed Hollywood and Highland (Lot 745) Rate Structure Morning Special Rate Calendar Year Rate Entry Time Exit Time (In By) (Out By) Minimum Stay Weekday Monthly Rate Calendar Year Rate Entry Time Exit Time (In After) (Out By) Overstay Fee per 15 minutes, 17 maximum fee per 15 minutes, 17 maximum fee per 15 minutes, 18 maximum fee per 15 minutes, 18 maximum fee per 15 minutes, 20 maximum fee April 11, 2018 Page 2 of 2

5 ATTACHMENT 2 WALKER CONSULTANTS MEMORANDUM HOLLYWOOD & HIGHLAND - RATE ANALYSIS PROJECT # DATE: April 4, 2018 TO: Louis Flokas COMPANY: SP Plus ADDRESS: 6801 Hollywood Boulevard CITY/STATE: Los Angeles, California COPY TO: Steffen Turoff - Walker Consultants Tania Schleck - Walker Consultants FROM: Ashley Hiniker PROJECT NAME: Hollywood & Highland Rate Analysis - Morning Special and Weekday Monthly Rates PROJECT NUMBER: Walker Consultants (Walker) was requested by SP+ (Operator) to recommend appropriate 2018 Morning Special and Weekday Monthly Permit parking rates (prices) at the City of Los Angeles' (City) Hollywood and Highland garage (Facility) located in the heart of the Hollywood district in Los Angeles. Based on the rate survey completed in Walker's 2017 Hollywood & Highland Rate review submitted in August 17, 2017, we analyzed the rate structure and propose the following new products and associated prices for the Facility. Additionally, SP+ requested that Walker recommend a parking rate schedule for the Facility for future years (out to year 2022), which is summarizes and discussed at the end of this memorandum. MORNING SPECIAL RATE The Morning Special (MS) is a special rate, typically discounted from the all day rate, which would be implemented to draw parkers who park in the area Monday through Friday during the daytime into the facility. The intention of the rate is to utilize underutilized parking spaces during the day, while providing a discount to those parkers who fall within the time parameters. The MS should be designed with the following time parameters: o o o In by time; Out by time; and Minimum hour stay. Walker reviewed the market survey from 2017 and recommends the following rate and time structure. Table 1: Recommended Morning Special Rate Rate Entry Time (In By) Exit Time (Out By) Minimum Stay Morning Special AM - 9 AM 4:30 PM 5 Hours Source: Walker Consultants, 2018 The proposed Morning Special (MS) parkers who enter the garage Monday through Friday between the hours of 7:00 AM and 9:00 AM, stay a minimum of 5 hours, and exit before 4:30 PM to receive a rate. This rate would benefit early commuters who begin have an early start/early end work schedule. 1

6 MEMORANDUM WALKER CONSULTANTS HOLLYWOOD & HIGHLAND - RATE ANALYSIS PROJECT # The strict time parameters and minimum stay requirements are in place to avoid discounting any transient parkers paying the All Day Rate, typically tourists. Additionally, the early out by times are designed to encourage parkers to exit the Facility prior to the event traffic, as the event volume is significant and profitable for the Facility. MS parkers are typically one of the most price sensitive transient parking groups. Through Walker's experience, MS parkers are likely to relocate from one garage to another due to price changes. Due to this sensitivity, it is recommended to survey the market monthly or quarterly for price changes that may impact the demand of the Facility. MONTHLY WEEKDAY PARKERS Similar to the MS rate recommendations, the monthly weekday parking permit is designed to capture those parkers who work nearby and will only park during weekday business hours, minimizing interference with event parkers. The monthly permit is for those who would like to park daily, rather than once or twice a week. The weekday monthly permit should have strict time parameters indicating in by and out by times. If the parker enters early or leaves past the designated times, the parker should be automatically charged an additional overstay fee. Implementing the overstay fee will assist in compliance with the time restrictions, ultimately allowing for the evening occupancy to be available for event parkers. Utilizing the 2017 rate survey completed by Walker, the following rate and time structure are recommended. Table 2: Recommended Weekday Monthly Rate Weekday Rate Monthly Rate Entry (In After) Exit Time (Out By) Overstay Fee :00 AM 4:30 PM 2/15 minutes, 15 maximum fee Source: Walker Consultants, 2018 The current monthly parking rate at the Facility is 125, but there is currently a waiting list in order to apply. The 100 weekday monthly rate allows those parkers to utilize the Facility only during the hours of 5:00 AM and 4:30 PM. Should the parker enter or exit the Facility five minutes or more beyond the time restriction, a 2.00/15 minute overstay fee should be automatically applied. The parking access and revenue control system (PARCS) should notify the Operator of the overstay and the credit card on file should be automatically charged. As with the MS rates, the strict time requirements are designed to self-select for those employees who have earlier work schedules, allowing them to leave the facility by 4:30pm, or to encourage parkers who would consider the discounted rate to exit the Facility prior to the event traffic, as the event volume is significant profitable for the Facility and necessary to maintain Hollywood and Highland and the Dolby Theatre as a destination and venue. CONCLUSION The Facility seeks to occupy underutilized parking spaces on weekdays, while also providing sufficient spaces to accommodate the regularly scheduled event traffic in the evenings. To achieve these goals, Walker recommended implementing a Morning Special (11.00) parking rate and a weekday monthly permit (100.00) product. Each rate should include strict time parameters for the user, to ensure capacity in the evenings. The market should be 2

7 WALKER CONSULTANTS MEMORANDUM HOLLYWOOD & HIGHLAND - RATE ANALYSIS PROJECT # surveyed monthly or quarterly by the Operator to maintain competitive rates. Based on our observations in Hollywood, unlike the nearby Downtown Los Angeles parking market, early bird parking rates are currently not in effect at other facilities. However, the recommended rates may provide employees and possibly commuters with parking prices that are more affordable than the current market allows. FUTURE PARKING RATES Walker recommends a parking rate schedule for future rates (out to year 2022), as summarized in Attachment 1 by rate type. However, occupancy at the Facility should be monitored regularly to ensure that the current proposed rate increases do not negatively impact parking demand. Additionally, the surrounding parking market should be regularly surveyed to ensure that the rates charged at the Facility are competitive. If it is found that the rate schedule is significantly reducing demand or if the rates are significantly higher than the surrounding market, the rates should remain the same or be decreased. 3

8 ATTACHMENT 1 Proposed Hollywood and Highland (Lot 745) Rate Structure Morning Special Rate Entry Time Exit Time Calendar Year Rate Minimum Stay (In By) (Out By) Weekday Monthly Rate Calendar Year Rate Entry Time Exit Time (In After) (Out By) Overstay Fee per 15 minutes, 17 maximum fee per 15 minutes, 17 maximum fee per 15 minutes, 18 maximum fee per 15 minutes, 18 maximum fee per 15 minutes, 20 maximum fee April 4, 2018 Page 1 of 1

9 ATTACHMENT 3 Hollywood & Highland Parking Facility (Lot No. 745) Revenue and Proposed Expenses FY FY FY FY FY FY FY TOTALS Net Revenue: 11,618,818 11,851,195 12,088,218 12,329,983 12,576,582 12,828,114 73,292,911 Total Expenses: 7,823,866 7,980,343 7,912,800 7,987,056 7,987,056 7,987,056 47,678,177 Adjusted Revenue: 3,794,952 3,870,852 4,175,418 4,342,927 4,589,526 4,841,058 25,614,734 Additional 5% Revenue: Prior Year Cash Balance: 651,816 3,340, ,852 4,065, ,149 4,865, ,712 9,439, ,546 14,273,074 3,392,075 35,984,702 Revenue: 7,863,319 8,906,234 9,886,369 14,720,957 19,819,679 64,991,510 59, ,000 60,441 61,650 62,883 64, , , , ,500 1,542, ,000 Proposed Improvements: 1 Parking Occupancy Tax for Additional 5% Revenue 2 Monument Sign on Highland Ave. 3 Monument Sign on Orange Ave. 4 Security Cameras Upgrades 5 Epoxy Flooring (P3 level) 6 Epoxy Flooring (P4-P6 level) 7 Stairwell Rehabilitation (No. 5/6) 8 Stairwell Rehabilitation (No. 4/3) 9 Stairwell Rehabilitation (No. 1/2/7) 10 LED Lighting Retrofit 11 Additional Painting to Maximize Lighting 12 Parking Guidance Displays and Occupany Sensors 13 Data Infrastructure / Integration 14 Parking and Revenue Control System 15 Vertical Core (Common Area) Upgrades 16 Restriping driveway / walkway entrances 17 Additional maintenance not in contract 3,794, ,000 65,000 65,000 75, ,000 2,000,000 65, , , , , ,000 1,542, , ,000 1,050,000 2,000, ,000 75, ,000 Total Proposed Improvements: 454,300 3,797,356 4,040, , ,883 99,141 9,286,270 Available Cash: 3,340,652 4,065,963 4,865,293 9,439,719 14,273,074 19,720,538 55,705,240 4/11/18