Scranton City Council on Tuesday approved an increase to the hours of paid weekday parking downtown to avoid defaulting on bond payments — and after the city made some concessions.
The new plan, negotiated over the past week, eliminates a previous recommendation to require paid on-street parking on Saturdays.
But it extends paid parking on weekdays by two hours, at least for the next three years.
“All I know is the city went into default once before, and I'm not going to let history repeat itself,” council member Bill King said.
Council voted 4-1 in favor of the proposal, with Tom Schuster voting no.
“I am happy that concessions have been made, but I feel the deal could have been a little bit better,” Schuster said.
Previous proposal failed
During last week’s council meeting, council failed to pass a plan that would have charged for on-street parking on Saturdays and required an additional three hours during the week.
Downtown business owners, residents and nonprofits expressed concerns about the changes at that meeting.
Jenn Saunders owns Northern Lights Espresso Bar and Cafe on Biden Street. She was one of those business owners and spoke again to council on Tuesday.
"I am glad that with the elimination of Saturdays … that part of the responsibility is taken off of the residents and the customers and the people that come to downtown, that's a step in the right direction," she said. "I still think with the extension during the week, that the businesses will be negatively impacted."
In the new plan, on-street paid parking hours will be from 8 a.m. to 7 p.m. Monday through Friday.
'The hand we're dealt'
Scranton leases its parking garages and parking meters to the nonprofit Grow America, formerly called the National Development Council. The nonprofit took over managing downtown parking in 2016 as part of then-Mayor Bill Courtright’s financial recovery plan for the city. The deal helped the city relieve itself of the parking system's debt, which city council had defaulted on paying years before.
Almost 10 years later, Grow America still has $45 million in parking debt.
"I understand why the decision was made when it was made. Here we are again. We have to play the hand we're dealt. I think this is a very good compromise,” Mayor Paige Cognetti said Tuesday afternoon in announcing the deal ahead of council's vote.
Dave Trevisani, from Community Development Property Scranton, a Grow America arm, told council that the nonprofit secured a deal with the investment firm AllianceBerstein that eliminates $15 million by restructuring the debt but requires extending paid street parking hours. He also said the nonprofit is still recovering from the pandemic.
Grow America asked city council to approve extending payment hours as part of a proposal to ensure the payment of that debt. Nonprofit representatives said the current bonds would go into default without refinancing. They did not have a lot of time to lock in interest rates.
“Not reaching a deal means that the parking system would be in jeopardy of receivership, meaning that we have no say in what this system would do. We have no say in rates. We would have no say in the parking hours, the operating times, the days,” Cognetti said, adding that the city still has a "seat at the table" under the new plan.
McAndrew: 'This isn't a great deal'
Council member Mark McAndrew called the issue “another rush job by the administration.”
“This isn't a great deal, and it's certainly nothing to be promoted as a political victory,” he said.
“Small businesses are the backbone of our city, and many are still recovering from years of economic challenges. Weekend parking fees would have hurt them at their busiest time," McAndrew said. "That's why my focus was on finding a solution that avoids default without placing more burdens on the small businesses, residents, students, or even the library patrons.”
But McAndrew said he voted for the new parking plan since it removed weekend parking fees.
“I believe I did my job with the best interest of our residents in mind. Had I not voted no last week, I'm not sure we ever would have seen a better outcome,” he said.
Other key points of deal
City representatives, including Solicitor Jessica Eskra and Grow America representatives, went back into negotiations with AllianceBerstein after last week’s meeting.
"We were able to go successfully back to the negotiating table with the bondholders and negotiate out the Saturday parking based on the residents and businesses expressing their concerns,” Cognetti said.
Other key points include:
- In the new plan passed by council, the city will contribute $250,000 to the debt, instead of $200,000. Cognetti, who was not involved in the negotiations, said the investment firm asked for $275,000 but a compromise was made.
- A service fee also will be charged for credit cards and bagging fees will increase.
- The agreement includes a $2 million contribution from the city over the next 10 years for system maintenance and repairs of four garages; add solar panels to two garages to generate revenue; and dissolve the parking authority, who still own the garages.
- Rates at meters and garages will not change because of the new proposal. It costs $2 for an hour to park on downtown streets and $1 an hour to park in the garages. The on-street parking charge will go up to $2.25 in 2026, but that was part of a previously agreed upon fee structure.
The new plan will be in place for three years.
“Then at year three, we'll be back where the city and city council will decide whether to keep paying that extra money, which could increase depending on the modeling, or if Saturday parking would go into implementation," Cognetti said.
"So we have a few years here to really do the financial work, do the community engagement work," she added.
