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Hagerstown officials will continue discussions Tuesday about recent parking rate hikes that have drawn criticism from downtown stakeholders.
The mayor and city council last month agreed to revisit the topic and consider lower increases after representatives of Middletown Valley Bank, Bowman Development Corp. and the University System of Maryland at Hagerstown spoke against the increases.
Concerns revolved around the increased cost, the lack of demand for current parking facilities and the short time between approval in late June and the new rates' effective date of July 1.
Council members at that time agreed to discuss the matter further and consider rescinding the changes in favor of an agreeable alternative rate schedule.
The topic will be discussed during Tuesday afternoon's work session meeting, which begins at 3 p.m.
In a memo to City Administrator Valerie Means, Public Works Director Eric Deike wrote that the staff recommends keeping the rates as the council approved them on June 26. The council approved an increase of 3 percent for the city's two parking decks and 4 percent for lots.
City officials have said the changes "level the playing field" for all parking users.
Bulk discounts, established 22 years ago, would be eliminated as of July 1, 2019, when the urban-improvement project downtown is expected to be completed.
"The recommendation puts the parking system on firm financial footing and builds a fund for future expansion, infrastructure renovations, repairs and other amenities," Deike wrote. "It is a forward thinking philosophy."
Without the rate increase, the city's Parking Fund is expected to produce a surplus of about $100,000 in the current year, but that wasn't always the case, according to Deike.
In 2012, the city paid off the debt service on the University District Parking Deck after 32 years of payments that were well over that $100,000 figure, he wrote in the memo.
The enterprise fund currently has about $1.2 million in cash reserves, but more is needed, specifically for new debt service payments, if the city plans to build a third parking deck, which officials and studies have indicated is needed in the future.
"Having a healthy reserve fund should not be considered in a negative light and should not be viewed as profit but as a hedge against future expenses such as expansion," Deike wrote in the memo. "It is only with cash reserve the city will be able to afford and sustain parking deficits if and when a third parking deck is constructed."
Budget projections show the increase, as approved, would boost revenues by a little more than $272,000 in the current fiscal year, which began July 1. Revenues are projected to continue increasing, up to almost $425,000 more, by the 2021-22 fiscal year.
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