Auburn citizens have complained for years about the lack of parking in the downtown area.
Therefore, city leaders decided that a public-private option was a solution to increase public parking.
Let us look at what the public knows about this public-private partnership:
1. The city of Auburn is weighing a development agreement that will see the city lease the ground for $10 a year for 60 years.
2. Upon completion of the development, the developer will receive the deed to the city's land that the hotel, grocery, and retail are built upon.
3. Subsequent to receiving the deed, the hotel, grocer and retail can be sold or leased by the developer. The garage can be leased to a garage operator.
The city retains the right to approve the hotel, the grocer and the garage operator.
4. The hotel must be operated as a hotel for 10 years. Thereafter, the space can become anything approved by the Auburn City Council.
5. The grocery store must operate as a grocer for 20 years. After 20 years, the space may operate in any capacity subject to approval by the city council
What does the city gain from this development?
1. Approximately 100 more parking spaces that are public and a parking garage operating 24 hours a day, seven days a week at a cost of $1 per hour, subject to an increase every five years.
The city may lease more spaces (up to 50 maximum) at market lease rates, if it chooses. The garage reverts to the city at the end of the lease agreement of 60 years
2. $10 a year ground lease for 60 years
3. Various taxes that total approximately $700,000 to $800,000 each year, according to a city official, before any tax incentives. (If the business operators vacate, the taxes could be lower.)
4. City officials have been quoted that the development would increase the value of the surrounding area.
Good deal or bad deal?