As part of an ongoing effort to boost New Haven’s financial fortunes during tough economic times, the city’s Economic Development Administrator outlined a plan Wednesday night that would privatize the city’s parking business and result in a guaranteed increase of at least $225,000 in revenue from last fiscal year.
Testifying before the Finance Committee of the New Haven Board of Aldermen, Henry Fernandez explained the city’s plan to sell the right to collect parking fees and fines on city streets to the New Haven Parking Authority, reasoning that a private company which might be more concerned with the bottom line can do a better job than the city.
No contracts have been signed yet, but there are already major concerns about the legality of the sale of an element of a city department — which drew about $5.5 million in revenue last year — and the futures of the 18 city employees who currently work in that department.
“We are going to have to find creative solutions to gain additional revenue,” said Fernandez, who was accompanied by Assistant Corporation Counsel Jonathan Beamon and Director of Traffic and Parking Brian McGrath. “If we can do this without people losing pay, that’s where I’d want to be.”
Fernandez said the expectation is that all the employees who would lose their present positions under the plan would continue their same duties at the NHPA while receiving the same pay, benefits, and seniority level.
He said he had spoken to some union officials about the prospective switch, but that formal negotiations between the affected employees, the city, and the unions have not yet been scheduled.
Preliminary reaction from the meter collectors and others who would have to switch employers or be out of work was uniformly negative.
Cherlyn Poindexter, chief steward for Local 3144 representing five management employees in the Office of Traffic and Parking, said her biggest worry is that her long tenure as a city worker would be nullified by the switch. She also thought the move was illegal given the terms of her current contract.
“I have 18 years in the department,” she said. “If I leave, I’m starting from day one. It’s subcontracting plain and simple, and in our contract, you can’t subcontract the work out. The closer you get to your pension, that’s when they cut you out.”
Bruce Fisher, who is a manager at the OTP, would not lose his job but said he thought the move was not a good idea because of the NHPA’s perceived priorities in the business.
“We have a service-based organization, whereas they have a revenue-based organization,” said Fisher of the possible detriment to municipal service.
McGrath defended the plan, saying the employees’ concerns are too vague and that privatization will be lucrative and carry no bad baggage.
“This is being done to gain the flexibility in the operation to realize the money-making potential that is out there,” McGrath said. “[The employees] don’t trust this to work their benefit, but their concern is diffuse and non-specific.”
In response to concerns that city jobs are being deceptively eliminated, McGrath said, “Everyone needs their services, and we’ve guaranteed it’ll be the same people.”
The alderman questioned the legality of the move in a memo to the city’s lawyers, and Beamon responded by saying that the concept was permissible.
They also grilled Fernandez about the intricacies of the proposal and the prospect of even more layoffs in the city. He responded by saying that the city would prefer to make the move and the employees keep their current pay and benefits, but failing that, the city would continue with the proposal without the workers.
“It doesn’t make sense to me,” said Ward 25 Alderwoman Nancy Ahern. “It’s a well-functioning department and it generates millions of dollars in revenue. To sell this very significant asset is troubling. I don’t understand it at this point and I don’t support it.”
To settle many outstanding questions, the committee will reconvene next week for the last in a series of budget workshops to discuss the matter further. The aldermen must vote the whole budget up or down by May 27 so that Mayor John DeStefano Jr. can sign it before the beginning of fiscal year 2003-04 on July 1.