Newport looks to outsource parking meter services

As its neighbor Costa Mesa plans to outsource half its workforce, the Newport Beach City Council will consider Tuesday if it should contract out its parking meter operations and enforcement.

The city would have to lay off a full-time meter service worker and a supervisor and it would eliminate the part-time work of another service worker. Additionally, three vacant Police Department parking enforcement positions would remain unfilled, and another service worker plans to retire in April, according to city spokeswoman Tara Finnigan.

In total, almost seven jobs would be removed from the city workforce.

“This program is ideal for contracting out because the industry is very specialized and is able to create greater efficiencies than an in-house operation,” Administrative Service Director Tracy McCraner wrote in a staff report.

The report states that the city would save $500,000 per year in operational costs, which are mainly for salaries.

But in the first few years it could be paying more than that to the proposed contractor, Central Parking System Inc. of Nashville, Tenn.

If the meters, under Central’s management, bring in the same $3 million annually that the city receives today, then the city would pay Central about $800,000 to operate them each year.

The higher operational cost is because Central would have more employees working the streets than the city does now.

Also, Central plans to replace some of the meters, at a cost of $2.4 million, or about $380,000 for seven years of its contract. Newport gets to keep the equipment, including new credit-card payable meters.

Where the city could save, and possibly make more money, is if Central brings in much more revenue than the meters make today.

Drivers might be more likely to park and pay with a credit card system, City Manager Dave Kiff said, and the meters would simply be in working order.

“We admittedly, did not have enough staff assigned to these efforts and that is mostly related to our budget tightening,” Kiff wrote in an email.

Also, with stricter enforcement, Central may give people an incentive to pay the meters more frequently. Any citation fines, though, would go straight to the city.

If the contractor can generate significantly more revenue from the meters – to the tune of more than $4.1 million per year – then it would share the proceeds with the city.