New Britain Parking System Due Diligence Assessment

Prepared by:

Chicago, Illinois

September 8, 2016

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1.0 Introduction

The City of New Britain, CT (“City”) retained DESMAN to perform a financial and physical due diligence review of its parking assets and to develop realistic projections of the future financial performance of the parking system under three scenarios: 1) the City continues to operate and maintain the parking assets as they have historically; 2) the City continues to operate and maintain the parking assets, but automates revenue collection in the garages, and; 3) the City grants the right to operate and maintain the parking assets and collect all associated revenue to an outside entity in exchange for an upfront, lump-sum payment to the City. The purpose of this study is to assess the existing physical and financial state of the parking system (“Parking System” or “System”), including its place in the competitive market, to identify opportunities for revenue growth and cost savings assuming the operations are outsourced, and to develop long-term financial projections for the System under the three scenarios noted above.

As part of this due diligence assessment, DESMAN performed a site visit to analyze all parking assets, evaluated the long-term structural needs of the City’s parking garages, performed parking occupancy surveys, reviewed financial and operating records, surveyed the market for competing parking, independently analyzed economic and demographic trends, and spoke to the City’s Department of Property Management which currently operates the Parking System. In its review and analysis, DESMAN has also drawn on its knowledge of similar parking systems nationwide.

2.0 DESMAN

DESMAN is a national specialist in parking structure planning, design and restoration, offering a full range of services including financial analysis, transportation engineering, master planning, economic feasibility studies, site/size selection analysis, cost estimating, parking functional design, architectural design, structural engineering, revenue/access control system design, condition survey/due diligence studies, parking consulting, and restoration engineering. The firm has been in existence since 1973 and the staff of over one-hundred people, comprised mostly of transportation and parking planners, architects, and structural engineers, currently operates on a national basis out of nine principal offices. DESMAN has provided financial review and performance projection services related to the parking assets of hundreds of municipal and private clients across the country. DESMAN has also served in an advisory role on nearly every successful or proposed parking privatization transaction that has occurred in the United States over the past decade.

3.0 Parking System Description and Historical Performance

This portion of the report presents an overview of the City of New Britain’s Parking System including the location and inventory of its existing assets, historical parking rate data, current utilization data, a review of the City’s existing revenue collection technology, and an analysis of the parking enforcement operation.

3.1 New Britain Parking System The Parking System consists of 3 structured parking facilities containing a total of 1,919 spaces open to the public, as well as 4 surface parking lots containing 98 spaces and 315 on-street metered spaces. The parking garages provide both daily and permit parking and are controlled using tickets and gates for

New Britain, CT Parking System Due Diligence Assessment Page 2 of 28 daily parking and hangtags or electronic parking access cards for permit parkers; one of the garages also contains 28 metered parking spaces. The spaces in two of the surface parking lots are controlled using multi-space, pay-by-space kiosks, a third lot is controlled by single-space, mechanical parking meters for a portion of the spaces, while the remaining spaces are permit-only, and the other surface lot is a permit-only facility. The on-street spaces are controlled through a combination of single-space, electronic meters, single-space, mechanical meters and multi-space, pay-by-space kiosks.

In addition to the physical parking assets, the System also includes the parking enforcement operation and the revenues and expenses associated with issuing citations for parking violations.

Figure 1 illustrates the geographic location of the City’s parking assets. The City’s three parking garages are located at the corner of Columbus Boulevard and Washington Street (Badolato), Bank Street and Scalise Drive (Szczesny) and Pearl Street and Liberty Square (Blogoslawski). The on-street parking meters are distributed throughout downtown and as far south as Grand Street in front of the Hospital of Central Connecticut and as far north as Main Street north of CT-72.

Table 1 provides a list of the City’s off-street parking assets including a letter identifying each facility (which corresponds to Figure 1), the address or cross streets of each facility, the name of each garage, and the number of spaces in each facility. The table also includes the total number of on-street metered parking spaces as of the date of this report.

Table 1 – Inventory of On- and Off-Street Parking Assets

ID Address or Intersection Facility Name Inventory A 35 Washington Street Badolato (Washington Street) Parking Garage¹ 170 B 35 Bank Street Szczesny (Bank Street) Parking Garage² 670 C 14 Franklin Square Blogoslawski (Liberty Square) Parking Garage³ 1,079 D 185 Main Street Surface Lot 29 E Main Street & Elm Street Surface Lot 21 F 35 Glen Street Surface Lot⁴ 24 G 85 Arch Street Surface Lot 24 Garages 1,919 Surface Lots 98 Total Off-Street 2,017 Total On-Street 315 Total Spaces 2,332

Source: City of New Britain; DESMAN

1) Of the 170 spaces open to the public in the Badolato Garage, 28 of the spaces are controlled using single-space parking meters; the remaining 142 are permit spaces. The top several levels of this garage (containing 330 spaces) are gated and used for City and Board of Education employees. 2) The top levels of the Szczesny Garage are gated and provide restricted access to the Police Department (approximately 200 spaces). 3) While there is an entrance to and exit from the Blogoslawski Garage on Pearl Street, this access point and the lower levels of the southern portion of the garage are restricted for use by employees of the Court. 4) Of the 24 spaces in this surface lot, 8 are controlled by single-space parking meters and 16 are dedicated to permit parking.

Given the difficulty of presenting the information clearly in Table 1, it should be noted that, system- wide, there are a total of 401 spaces controlled by some kind of parking meter.

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Figure 1 – Locations of the City of New Britain’s Parking Assets

N Garages Surface Lots On-Street Meters

A

B D

E G C F

Source: City of New Britain; DESMAN

As shown in Table 1, off-street spaces (i.e. garages and surface lots) account for approximately 86% of the total spaces (2,017 of 2,332 total) owned/operated by the City, while on-street metered spaces

New Britain, CT Parking System Due Diligence Assessment Page 4 of 28 account for about 14% of the total spaces. On the whole, metered spaces account for 17% of the total spaces (401 of 2,332 total).

3.1.1 Historical Parking Rates in New Britain Since the establishment of rates for on- and off-street parking in New Britain, the City has increased rates periodically in an attempt to keep pace with the every-increasing cost of operating the Parking System. The following is a brief summary of the historical parking meter rates, hourly and monthly parking rates in the garages and fine amounts for parking violations.

3.1.1.1 Parking Meter Rates From 2001 until late 2014, the rate charged for parking at most meters in the City of New Britain was $0.75 per hour. However, the parking meters installed in the Badolato Garage, as well as those on Pearl Street, Bosco Drive and Badolato Drive, charged a rate of $1.00 per hour.

In late 2014, the rates charged for parking at all meters (both single-space and multi-space kiosks) were increased city-wide. The typical rate of $0.75 per hour was increased to $1.50 per hour, while the $1.00 per hour meters were increased to $2.00 per hour. While both of these rate changes represented an increase of 100% at the time, because it had been 13 years since the previous rates were established, this equated to average annual rate increase of slightly less than 6%.

3.1.1.2 Garage Hourly Rates While parking meters are used in the Badolato Garage to charge transient parkers, parkers at the Szczesny and Blogoslawski garages are issued a ticket upon entering the facilities and are charged at the exit, based on the amount of time they remained parked. Prior to 2009, the cost to park in the Szczesny Garage was $1.00 per hour, with a maximum charge of $8.00. At the Blogoslawski Garage, one hour of parking cost $2.00, while the maximum daily charge was $10.00.

In 2009 and again in late 2014, the hourly parking rates in both garages were increased by $0.50. The current rates in the Szczesny and Blogoslawski garages are now $2.00 and $3.00 per hour, respectively, with maximum all day rates of $16.00 and $15.00.

The $1.00 per hour increase in the hourly parking rates charged at the Szczesny and Blogoslawski garages since 2008 equate to average annual increases of almost 15% and 8.5%, respectively.

In addition to these regular hourly rates, parking for CTfastrak riders (Connecticut’s new bus rapid transit system) is $3/day at the Szczesny Garage.

Customers parking in any of the City’s garages must only pay for parking on weekdays – both on- and off-street parking in the City is free on Saturdays and Sundays.

3.1.1.3 Monthly Parking Rates Monthly parking is available in all three of the City’s parking garages, with rates varying depending on the specific garage and the classification of parker.

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Prior to November 2014, the average monthly parker paid $35 per month (plus 6.35% tax) for parking both the Badolato and Szczesny garages; this is the same monthly parking rate paid at these garages dating back to July 2000. Since November 2014, the rate for regular monthly parking in these two garages is $40 plus tax. Organizations that are typically tax exempt, such as churches, are also tax exempt when purchasing monthly parking permits.

In addition to the regular monthly parking rates, there are four other monthly rate categories in the Badolato Garage: 1) a senior monthly parking rate of $30 plus tax; 2) a new business parking rate of $10 plus tax; 3) a $15 per month, tax exempt rate for City employees and Board of Education employees, and; 4) a $25 per month, tax exempt rate for residents of Anvil Place. It should be noted that the new business monthly parking rate is only available to businesses that are new to the City and are valid for the first year only. After the first year, the regular monthly parking rate applies.

In the Szczesny Garage, there are also four other monthly rate categories aside from the regular monthly rate: 1) free monthly parking for the Connecticut Breast Health Initiative and the New Britain EMS Academy; 2) New Britain Herald monthly parking at a rate of $20 plus tax; 3) a $30 per month, tax exempt rate for the New Britain Housing Authority, and; 4) a seasonal monthly parking rate of $30 plus tax.

Monthly parking rates in the Blogoslawski Garage are currently, and have been historically, higher than those charged for parking in the other two garages. From June 1999 until the end of October 2014, regular monthly parking is the Blogoslawski Garage cost $75 (plus tax) per month. In November 2014, this rate was increased to $80 (plus tax) per month.

Like the Badolato and Szczesny garages, there are several additional monthly rate categories, aside from the regular monthly rate, charged at the Blogoslawski Garage. The other monthly rate categories are: 1) a $60 (plus tax) rate for businesses located on Pearl Street; 2) a $55 per month, tax exempt rate for employees of the Connecticut Department of Energy and Environmental Protection, and; 3) a $65 per month, tax exempt rate for court employees.

The $5.00 per month increase in the regular monthly parking rate charged at the Badolato and Szczesny garages in November 2014 equates to an average annual increase of slightly more than 1%, while the $5 increase in the regular monthly parking rate at the Blogoslawski Garage equates to less than a 0.5% average annual increase since the previous rate increase.

3.1.2 Metered Parking Time Limits Parking meters in New Britain are currently enforced Monday through Friday between the hours of 8:00AM and 5:00PM, with Saturdays, Sundays and select holidays unenforced. The holidays on which meters are not enforced are determined on an annual basis by the City.

Each metered parking space has a specified time limit, varying between one, two, three, four, five, and eight hours. Shorter parking time limits encourage turnover and ensures that there are available spaces for incoming parking patrons, while longer parking time limits accommodate parkers who do not have access to a nearby parking garage. Higher turnover rates at meters can improve revenues generated for each space, while guaranteeing that parkers are able to locate open spaces.

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Figure 2 illustrates the distribution of metered parking time limits in the city. This shows that the majority of spaces (67%) allow drivers to remain parked for two or three hours. These time limits are generally accepted within the parking industry as ideal for creating turnover of parking spaces, while also remaining manageable from an enforcement perspective.

The City also accommodates parkers who require longer durations of stay by offering 4-, 5-, and 8-hr spaces. In line with best practices in the parking industry, these spaces are located on the periphery of downtown, as well as in the surface lots and the Badolato Garage. Preserving a majority of the metered parking supply in the core of downtown for high-turnover, short-term parkers is crucial to sustaining the vibrancy of downtown retail and restaurant businesses.

Figure 2 – Distribution of Metered Parking Time Limits

Parking Meter Time Limits 3%

9%

16% 32%

5%

35%

1 Hour 2 Hours 3 Hours 4 Hours 5 Hours 8 Hours

Source: City of New Britain

3.2 Parking Utilization One of the most important measures of performance for a City’s parking system is the utilization of its assets. Low utilization can mean that a parking facility or space is not located in an area where parkers want to be, but it can also mean that the price is too high and potential parkers find alternatives to parking in the City’s spaces. In facilities with high utilization, there is the potential to increase prices to generate additional revenue for the system and to redistribute demand to lower-utilization spaces.

On Wednesday, June 22, 2016, DESMAN conducted a peak hour utilization survey of the public portions of all of the City’s on- and off-street parking assets; the surveys excluded the areas in the three garages that are not accessible by the general public. The survey was conducted between the hours of 10:00AM- 11:30AM and 1:00PM-3:00PM, in order to capture the peak demand condition.

Table 2 presents a summary of the results of the June 2016 utilization survey of the City’s parking assets, with the data presented on a facility-by-facility basis. For ease of presentation, utilization of the on- street meters is presented as a single number.

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Table 2 – Observed Peak Utilization of the City’s Parking Assets, Wednesday, June 22, 2016

ID Address or Intersection Facility Name Inventory Cars Parked Utilization % A 35 Washington Street Badolato (Washington Street) Parking Garage 170 65 38% B 35 Bank Street Szczesny (Bank Street) Parking Garage 670 334 50% C 14 Franklin Square Blogoslawski (Liberty Square) Parking Garage 1,079 183 17% D 185 Main Street Surface Lot 29 5 17% E Main Street & Elm Street Surface Lot 21 3 14% F 35 Glen Street Surface Lot 24 6 25% G 85 Arch Street Surface Lot 24 17 71% Garages 1,919 582 30% Surface Lots 98 31 32% Total Off-Street 2,017 613 30% Total On-Street 315 136 43% Total Spaces 2,332 749 32%

Source: DESMAN

Overall utilization of the City’s parking assets was documented at 32% on the survey day, with utilization of the off-street spaces at 30% and utilization of the on-street spaces at 43%. Of the three garages, the Szczesny Garage experienced the highest peak utilization, where approximately 50% of the spaces were occupied on the survey day. With an observed peak utilization of 71%, the permit-only surface lot located at 85 Arch Street experienced the highest utilization of any off-street facility.

While the utilization of off-street parking spaces in the city appears to be very low, two factors likely contributed to this finding on the survey day: 1) the survey was conducted during the month of June when both employee and visitor parking activity tend to reach a seasonal low point and 2) there was not a peak level of activity occurring at the Connecticut Superior Court. Typically, in a city such as New Britain with little summer tourist activity, the summer months are the time during the year when parking activity reaches its lowest point. Additionally, not only are the summer months less active than other months for the Superior Court, the survey day was also not a day when jurors were present. According to the City’s representatives, when juror selection occurs, the demand for parking, specifically at the Blogoslawski Garage, is dramatically higher than on other days of the week.

When looking at on-street and metered parking in the city, although the documented utilization of the metered spaces in downtown was below 50% overall, there were concentrated areas of high demand (81-100% occupancy) on Main St. surrounding Central Park, on W. Main St. between High St. and Main St., on Main St. between Walnut St. and Elm St., and on Grand St. in front of the Hospital of Central Connecticut. Most of the very underutilized meters were located on the periphery of the downtown – on W. Main St. west of Cedar St., Bosco Dr., Badolato Dr., and Arch St. – or in the Badolato Garage and the surface parking lots.

In general, the City’s parking assets were underutilized, with only a few segments of on-street, metered parking spaces exceeding 80% utilization. However, again, it cannot be overstated the impact that seasonality and the activity levels at the Connecticut Superior Court can have on these utilization figures.

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3.3 Parking Technology While the parking access and revenue control technology in City’s parking garages has not been upgraded in many years, recently, the City has begun to upgrade the technology used for collecting parking fees at its on-street spaces and in some of its surface parking lots.

In the Szczesny and Blogoslawski garages, daily parkers pull a ticket from a ticket dispenser at the entry lanes and pay for parking time at the exit. The payment transactions are still processed in the exit lanes by cashiers using fee computers to calculate the appropriate parking charges. Unlike the recent trend in the parking industry toward removing people from the processing of parking transactions, no automated payment technology has been implemented in the City’s garages.

Unlike the parking garages, revenue collection technology at on-street spaces and in several of the City’s surface parking lots has been upgraded in the past several years and continues to be upgraded. The City currently has 6 pay-by-space payment kiosks controlling 50 surface lot spaces (lots D and E in Figure 1), as well as 42 on-street spaces in the vicinity of the triangle formed by Chestnut Street, Main Street and Elm Street. In addition, within the past two months, the City has purchased 99 new single-space, credit card enabled parking meters that will replace a portion of the existing single-space, mechanical parking meters on Main, West Main, High, and Chestnut streets. The major benefit of these new meters is that they offer multiple forms of payment – coins, credit and debit cards – allowing patrons to pay for their entire duration of stay, without being constrained by the number of coins they may need to complete their transaction.

While the City of New Britain has upgraded some of the revenue collection technology used in its parking operation, there is still room for improvement. Automating revenue collection in the garages and replacing the remaining single-space, mechanical parking meters with additional multi-space kiosks or credit-card enabled, single-space meters are just two improvements that the City could undertake to modernize its parking operation. Other technology enhancements that may warrant further investigation include the implementation of a pay-by-cell option for metered parking spaces and upgrades to the equipment and processes used to enforce metered parking regulations.

3.4 Parking Enforcement Enforcement of metered parking, formerly the responsibility of the Department of Property Management, is now controlled by the Finance Department with support from Property Management. The City deploys enforcement officers (Parking Meter Attendants) to monitor both metered and non- metered parking and to issue parking citations for a variety of violations including, but not limited to: overtime parking at an expired meter, parking in a restricted area, parking too close to a corner, etc. The enforcement of parking rules is of paramount importance to the performance of a City’s parking system. If parking rules are not properly enforced, parkers may not pay to park at a meter, resulting in lost revenue. If parking rules are enforced in an over-aggressive manner, there is likely to be public backlash and an increase in the number of violations contested in court. It is equally important that the fines charged for parking violations are set at an appropriate level so as to encourage payment of the meters, while not being overly punitive.

The current parking violation fine amounts charged in the City of New Britain associated with some of the more common parking violations are presented in Table 3. If tickets remain unpaid for a period of time exceeding 7 days, the initial fine amount triples.

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Table 3 – Sample of Parking Violation Fines

Description Cost Overtime Parking $30 Parking in the Opposite Direction of Traffic $30 Parking in a Restricted Area $60 Too Near Corner $60 Parking in a Bus Stop $90 Parking in Handicapped Zone $99 Parking in Violation of Snow Emergency Restrictions $99 Source: City of New Britain

The violation entitled “Overtime Parking” is by far the most common type of violation and involves non- payment of a parking meter. From January 1, 2012 through July 18, 2016, more than 35,400 violations of this type were issued, compared to 58,900 total parking violations issued (more than 60% of total violations).

Like metered parking rates, the fines associated with parking violations increased in November 2014, with most fines tripling. When setting the fine amount for non-payment of a meter, it is generally accepted in the parking industry that the fine should equal 10-15 times the hourly rate charged. In New Britain, with an hourly on-street parking charge of $1.50-$2.00, a fine of $30 for non-payment of a meter is appropriate. If and when metered parking rates are increased in the future, the fines for these types of violations should be increased accordingly.

As one might expect, tripling the fine amount for most parking violations has had an effect on the number of parking-related citations issued. Parking citation issuance data was provided by the City on a monthly basis for the period of January 2011 through June 2016 (this translates to the full fiscal years of FY12-FY16). Figure 3 presents a graphic representation of monthly parking citation issuance from FY12 through FY16, as well as the average volume of citations issued each month from FY12-FY15.

Figure 3 – Parking Citations Issued, July 2012 – June 2016

2,500

2,000

FY 2012 1,500 FY 2013 FY 2014 FY 2015 1,000 FY 2016 FY12- FY15 AVG.

500

0 Jul Aug Sept Oct Nov Dec Jan Feb Mar Apr May Jun

Source: City of New Britain

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As shown in the figure, over the last four fiscal years prior to FY16, the average number of citations issued was between 880 and 1,500 per month. Additionally, New Britain has historically followed the common pattern among cities of higher citation issuance during the winter months, when parking activity and the possibility of snow events is highest, versus the summer months, when parking activity is at its lowest point.

Since the fines charged for parking violations were tripled in November 2014 (shown in Figure 3 as the ORANGE line), the number of citations issued on a monthly basis has plummeted. Monthly citation issuance for the remainder of FY15 trended consistently downward, while all of FY16 experienced levels of citation issuance well below the previous four-year average. The number of parking citations issued per month in FY16 ranged from a low of 550 to a high of 880. However, because of the increase in the fine amounts, the value of citations issued in FY15 actually increased significantly over FY 14, while FY16 increased slightly over FY15.

While the increase in fines associated with parking violations likely contributed to the significant drop in the number of citations issued, per conversations with the City, the drop in ticket volumes in FY16 could also be due to the fact that one of the Parking Ticket Attendant positions was vacant during at least a portion of the year. Representatives with the Department of Property Management assert that this additional enforcement person is necessary to effectively enforce parking regulations within the city. However, the City’s Budget for FY17 assumes that this position will remain vacant.

4.0 Parking Rates in New Britain versus Other Municipalities

In order to understand how New Britain’s parking rates compare to those charged in other municipalities, the following presents detailed information related to the parking systems of 12 municipalities that share some similarity to New Britain either in geographic location, size and demographics of the population, parking system size, or several of these elements.

Table 4 presents detailed inventory, parking rates, hours of operation, and parking violation information for each of the 12 municipalities examined, in addition to the same information for New Britain. Any pieces of information that were missing could not be confirmed by the date of this report.

Table 4 – Parking Rates in Other Municipalities

Number of Parking Rates Late Number of Number of Overtime Meter Duration Prior to City State Population Metered Off-Street Off-Street Surface Lot On-Street On-Street Hours of Operation Payment Surface Lots Garages Garage (Monthly) Violation Fee Late Payment Fee Spaces (Hourly) (Daily Max) (Monthly) (Hourly) Fee

Bethlehem PA 75,018 1,300 13 4 $1.00 $10.00 $65.00 $40.00 - $55.00 $1.00 Monday - Saturday 8:00AM - 9:00PM $10.00 $20.00 14 days

Bridgeport CT 145,629 550 2 5 $6.00 - $20.00 $65.00 - $85.00 $1.00 Monday - Saturday 8:00AM - 6:00PM $40.00 $80.00 14 days

Danbury CT 84,657 433 4 2 $1.25 $9.00 $45.00 $45.00 $1.00 Monday - Saturday 9:00AM - 5:30PM 7 days Monday - Saturday 9:00AM - 8:00PM; Easton PA 26,800 700 4 2 $2.00 $16.00 $60.00 $45.00 $1.00 $25.00 $20.00 8 days Sunday 12:00PM - 6:00PM

Lancaster PA 59,325 946 3 7 $2.00 $5.00 - $15.00 $65.00 $40.00 $1.50 Monday - Saturday 8:00AM - 6:00PM $10.00 $20.00 15 days

Montclair NJ 37,669 1,257 17 4 $1.00 $12.00 $65.00 - $120.00 $65.00 - $120.00 $0.75 Monday - Saturday 8:00AM - 7:00PM $30.00 $10.00 7 days Monday - Saturday 8:00AM - 1:00AM; Newark DE 32,549 500 5 0 $1.00 - $1.25 $8.00 $85.00 $1.25 $15.00 $15.00 30 days Sunday 1:00pm - 1:00am

New Brunswick NJ 55,181 1,000 10 2 $2.00 - $3.00 $20.00 - $22.00 $160.00 - $175.00 $2.00 Monday - Saturday 8:00AM - 9:00PM $27.00 $10.00 14 days

Reading PA 87,893 900 7 9 $2.00 $11.00 $82.00 - $90.00 $30.00 - $69.00 $1.50 Monday - Friday 8:00AM - 6:00PM $25.00 - $35.00 $15.00 10 days

Scranton PA 75,806 1,500 1 5 $3.00 $9.00 $80.00 - $137.00 $1.25 Monday - Friday 8:00AM - 6:00PM $20.00 $25.00 14 days

State College PA 41,757 420 4 3 $1.00 $9.00 - $12.00 $90.00 - $105.00 $65.00 $1.00 Monday - Saturday 10:00AM to 10:00PM $6.00 $9.00 3 days

Wilmington DE 71,525 1,000 2 6 $2.00 - $3.00 $8.00 - $12.00 $125.00 - $175.00 $85.00 - $125.00 $1.00 Monday - Friday 8:00AM - 6:00PM $20.00 $20.00 21 days New Britain CT 72,808 401 4 3 $2.00 - $3.00 $15.00 - $16.00 $10.00 - $80.00 $24.00 - $32.00 $1.50 - $2.00 Monday - Friday 8:00AM - 5:00PM $30.00 $60.00 7 days Source: DESMAN

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Of the 12 municipalities examined, only 3 charged the same rate for metered parking as New Britain’s $1.50-$2.00 per hour rate – no municipality charged more. Among the municipalities, not including New Britain, the average rate for metered parking is approximately $1.20 per hour.

For garage parking, the average daily rate in these municipalities is approximately $12.25, compared to New Britain’s $15.00-$16.00. Monthly parking in surface lots ranges in average cost from $30-$125, compared to New Britain’s $24-$32, while monthly garage parking ranges from $45-$175, compared to $10-$80 in New Britain.

Based on the information contained in Table 4, the parking rates charged in New Britain at meters, as well as for daily transient parking in the garages, are markedly higher than the average rates charged in the examined municipalities, while the surface lot and garage monthly rates in New Britain fall in a similar range as the other cities. The implication is that the parking rates charged in New Britain are at a level where there might not be much room for additional future increases in the short term. The one exception are the monthly parking rates charged in the garages, which appear low based on the comparison and on the on-street and daily parking rates charged in the off-street facilities.

5.0 New Britain Market Area and Economic Trends

In addition to examining the physical characteristics, current utilization and historical financial performance of the City’s parking assets, macro- and microeconomic factors have also been examined for the purposes of this analysis. The overall health and vitality of the City of New Britain and the surrounding area will have an impact on the future financial performance of the parking system.

While population and employment influence parking demand in the City, the availability of competing parking facilities and availability of alternatives to driving and parking can also affect the financial performance of the City’s parking facilities.

5.1 Historical Gross Domestic Product Gross Domestic Product (“GDP”) by metropolitan area is an indicator of the economic health and productivity of a region and is defined as the market value of all final goods and services produced within a metropolitan area in a particular period of time.

The historical GDP of the Hartford-West Hartford-East Hartford Metropolitan Statistical Area (“MSA”), of which New Britain is a part, from 2001 to 2014 (the last year for which data is available) is presented in Table 5.

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Table 5 – Historical Real Gross Domestic Product, Current Dollars

Year Billion USD 2001 $59.7 2002 $59.0 2003 $61.2 2004 $67.4 2005 $70.7 2006 $75.4 2007 $82.1 2008 $81.2 2009 $82.7 2010 $82.6 2011 $81.7 2012 $81.2 2013 $83.6 2014 $85.6 Source: U.S. Bureau of Economic Analysis

From 2001 to 2014, the Hartford-West Hartford-East Hartford MSA experienced GDP growth from $59.7Billion to $85.6Billion. This change in GDP equates to an average growth rate of about 2.8% per year since 2001. Additionally, the data indicate that GDP in the MSA has grown steadily in the past several years, as the region and the country recovered from the effects of the Great Recession.

5.2 Population Changes in population in an area or city directly impact its financial viability and overall vitality. The prospect of long-term population growth in the City of New Britain is an important factor in determining the future financial performance of the City’s Parking System.

City, County and MSA population statistics were sourced from the U.S. Census Bureau’s tabulation of surveys conducted at 10-year intervals. As such, population estimates are required when attempting to characterize a year between Census counts. The historical U.S. Census population data between 1970 and 2015 for the City of New Britain, Hartford County, and the Hartford-West Hartford-East Hartford MSA are provided in Table 6.

Table 6 – City, County and MSA Population Trends, 1970-2015

Hartford-West City of New Britain % Growth Hartford County % Growth Hartford-East % Growth Hartford, CT MSA 1970 83,441 - 818,201 - 816,737 - 1980 73,840 -11.51% 807,766 -1.28% 807,766 -1.10% 1990 75,491 2.24% 852,567 5.55% 851,783 5.45% 2000 71,538 -5.24% 858,422 0.69% 1,183,110 38.90% 2010 73,240 2.38% 895,197 4.28% 1,214,139 2.62% 2015 72,808 -0.59% 895,841 0.07% 1,211,324 -0.23% Source: U.S. Census Bureau

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From 1970 to 2015, while both Hartford County and the MSA encompassing the City of New Britain have experienced net population growth, the population of the City itself has declined by almost 13%. Despite the fact that the City of New Britain experienced population growth from 1980 to 1990 and again from 2000 to 2010, population declines in the 2000’s and from 2010 to 2015 have resulted in the population of the City being at almost the same level today as it was in 1980.

If this historical population trend continues in the future, the population of the City of New Britain will continue to decline, potentially eroding economic activity in the City, as well as the demand for public parking.

5.3 Employment Table 7 provides a list of the top ten employers located in the New Britain as of 2016.

Table 7 - List of Major Employers in New Britain

Company Name Industry Local Employees The Hospital of Central Connecticut Hospitals 1,000 - 4,999 Cardiovascular Center Hospitals 1,000 - 4,999 Hospital For Special Care Rehabilitation Services 1,000 - 4,999 Stanley Hardware Hardware-Manufacturers 1,000 - 4,999 Central Connecticut State University Schools-Universities & Colleges Academic 500 - 999 Stanley Fastening Systems LP Staples, Staplers & Tackers-Manufacturers 500 - 999 Stanley Black & Decker Inc. Hardware-Manufacturers 250 - 499 Guida's Dairy Dairies (Milk) 250 - 499 New Britain High School Schools 250 - 499 New Britain Parks & Recreation Parks 250 - 499 Source: Connecticut Department of Labor

Of the 10 largest employers in the City, 3 are healthcare or medical related, 3 are hardware manufacturers, 3 are public institutions, and 1 is a dairy.

While the top 10 employers do not represent a significant amount of diversity in the types of companies and institutions in and around the City of New Britain, both the healthcare and public institution employers provide some stability in the labor market. The job market in New Britain also benefits from the fact that one or two major employers do not employ a majority of the population in the city.

5.4 Competing Parking Another factor that can significantly impact the performance of a parking facility or system is the availability of competing parking facilities. The City’s Parking System benefits from the fact that there are not many public parking alternatives in downtown.

While many individual businesses and institutions provide parking for their customers or patrons, there was only one other identifiable public parking facility in downtown New Britain. A small surface parking lot (~26 spaces) located next to Main Street Wine & Spirits charges for parking using a pay-by-space kiosk. This lot is actually owned by the City and leased to the store’s owner. While the store owner keeps the revenue generated by the kiosk, the City enforces the lot, writes tickets for parking violations and keeps the violation revenue. So, in realty, this surface lot does not really act in direct competition to the City’s parking assets.

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In addition to this small paid lot and the spaces provided by individual business to their customers, the only other spaces that could be identified by DESMAN that are available for public parking are on-street areas that are unmetered/unregulated. These areas of street are typically located outside of downtown and are either in residential areas or, if they are located nears businesses, are not well utilized. Two exceptions that come to mind are: 1) Arch Street south of Pearl Street and 2) Broad Street between Gold Street and Beaver Street in Little Poland. These two segments of street are both in commercial corridors and were highly occupied during DESMAN’s site visit. While not in direct competition with most of the City’s paid parking assets, there may be an opportunity to add meters in these areas to generate additional revenue.

Based on the existing conditions in the City and the relatively low demand for the City’s existing parking assets, competing parking facilities do not appear to pose an immediate or near-term threat to the financial performance of the parking assets operated by the City.

5.5 Alternatives to Parking Although driving is the primary mode of transportation in Hartford County and the City of New Britain, there are also public transportation options which visitors and residents can utilize. The percentage of people utilizing public transportation and whether or not this proportion grows in the future has an impact on the financial performance of the City’s parking assets. Additionally, the use of taxis and ridesharing services also has the potential to reduce the demand for parking in the City.

Unlike major metropolitan areas with large, integrated public transit systems and a wide variety of alternative transportation options, the potential for these types of systems and services to greatly impact the demand for parking in the City of New Britain appears limited.

5.5.1 Journey to Work Data The U.S. Census Bureau provides data, known as “Means of Transportation to Work” or “Journey to Work” data, on the preferred method of transportation which residents use when commuting to work. This data is presented for the City of New Britain, as well as Hartford County, in Table 8.

Table 8 – Journey to Work, City of New Britain and Hartford County

City of New Britain Hartford County # of Employees % # of Employees % Car, Truck or Van - Drove Alone 25,752 79.5% 345,595 81.0% Car, Truck or Van - Carpool 2,980 9.2% 35,413 8.3% Public Transportation 1,069 3.3% 15,786 3.7% Walked/Biked 1,037 3.2% 10,667 2.5% Taxi, Motorcycle or Other Means 1,004 3.1% 4,693 1.1% Worked at Home 551 1.7% 14,506 3.4% TOTAL 32,392 426,661 Source: US Census

This data indicates that slightly more than 3% of employees within the City of New Britain use public transportation when traveling to and from work, while nearly 89% drive alone or carpool. This pattern

New Britain, CT Parking System Due Diligence Assessment Page 15 of 28 can also be seen on a county level, where public transportation is utilized by almost 4% of employees, while driving alone or carpooling is used by slightly more than 89% of people.

The primary means by which people get to work in the city, aside from driving alone or carpooling and public transportation, is walking or biking.

5.5.2 Public Transportation CTfastrak is the first bus rapid transit system in the state of Connecticut and the second in the New England region. Opening in March of 2015, this line runs between Union Station in Hartford and Downtown New Britain Station. CTfastrak services run five local and four express routes on a 9.4-mile dedicated busway. Given its proximity to the Szczesny Garage and the special parking rate offered to CTfastrak users, the City’s Parking System may actually benefit from this alternate mode of transportation.

There is also an Amtrak station in Berlin, approximately two miles from New Britain. The Amtrak “Vermonter” and “Shuttle” both service this station and travel throughout the northeastern United States with stops including St. Albans, New York City, and Washington DC.

On a more local level, the New Britain Transportation Company provides residents and patrons with 10 separate routes throughout the region. Services typically run between 5:45AM and 12:30AM, with routes including stations in Meridian Square, at the University of Connecticut Health Center, and Bristol City Hall.

5.5.3 Taxis & Ridesharing The City of New Britain has a number of taxi services which residents and visitors are able to remotely call or hail. Some of the major taxi companies include: Yellow Cab, Ace Taxi, Hardware City Taxi of New Britain, and Tunxis Cab. The current taxi base fare in the city is $3.00 for the first 1/9th mile, increasing by $0.90 for each additional 1/9th mile of travel.

Ridesharing has also recently been introduced in New Britain with Uber, a service by which a patron is able to schedule a driver to pick them up in real-time with a mobile application. Uber, along with other ridesharing companies such as Lyft, Sidecar, and others have become increasingly popular as smartphone technology has developed and become more accessible.

While both taxis and ridesharing services are available in the City of New Britain, neither of these alternatives is likely to replace driving as a primary means of transportation.

5.5.4 Alternatives to Parking Conclusion As shown in the data provided above, the large majority of New Britain residents drive alone or carpool to and from work and will likely continue to do so. While public transit and other modes of transportation are available in the City and the surrounding area, these are not the primary means by which the majority of the City’s citizens travel to and from work and other destinations.

While it is important for the City to continue to accommodate alternative transit modes, it is unlikely that the City’s Parking System will be significantly negatively impacted by their use in the future.

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6.0 Financial Forecast Methodology and Assumptions

DESMAN developed three financial models for the City of New Britain Parking System which attempt to predict the future performance of the Parking System over the next 40 years, based on varying assumptions. Generally, the three models can be described as: 1) continued operation of the System by the City is a similar manner to what has been done historically (“Base Model”); 2) continued operation by the City with enhancements to parking technology (“Optimized Model”), and; 3) the City grants the right to operate and maintain the parking assets and collect all associated revenue to an outside entity, with the entity modernizing the entire operation.

The models use, as their base, the historical financials of the City from fiscal 2012 through fiscal 2016. To project the performance of the parking assets into the future, assumptions were made related to revenue and expense growth, as well as the capital expenditures which will likely be necessary to ensure that the City’s facilities and equipment are maintained in good working order.

The following sections describe in detail the underlying revenue, expense and capital expenditure assumptions relied-upon when formulating the 40-year financial performance projections for the Parking System.

6.1 Base Model The intent of creating the Base Model was to develop an understanding of how the Parking System can be expected to perform, if the City continues to operate the assets as they have historically. This model includes only infrequent parking rate increase assumptions, minimal demand growth and little in the way of technology enhancements to increase revenue and reduce costs.

What follows are the major assumptions which were applied in the financial projection model. In both the Optimized and Private scenarios, any assumption which varies from the Base Model is shown in italics.

Base Model Revenue Assumptions 1. Rates for monthly, transient and metered parking will increase every 10 years by 15%, with the first increase occurring in 2024 2. Fine rates and negotiated lease rates paid by large groups of parkers were assumed to increase on the same schedule as the regular rates 3. Parking demand growth will occur at a rate of 0.50% annually 4. An economic recession will occur, on average, every 7 years, resulting in a decrease in demand and the associated revenue in those years; revenue was assumed to return to its pre-recession level in the year following each recession

Base Model Expense Assumptions 1. Despite the Parking Enforcement function being moved to the Finance Department, these costs were assumed in the financial model to show the total financial impact of parking operations 2. Payroll-related expenses were assumed to grow by 4% annually, based on historical trends observed by DESMAN in similar municipalities

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3. All non-payroll-related expenses were assumed to grow by 2.5% annually, roughly matching the long-term rate of inflation 4. It was assumed that neither the vacant parking enforcement or cashier positions would be filled

Base Model Capital Expenditure Assumptions 1. The existing revenue control equipment in the parking garages was assumed to be replaced in kind in 2022 and every 10 years thereafter, based on the typical useful life of this type of equipment 2. The remaining mechanical, single-space parking meters that were not upgraded to credit-card- enabled meters were assumed to be upgraded with this technology in 2022 and every 10 years thereafter in kind; the existing multi-space payment kiosks were assumed to be replaced on the same schedule 3. Each of the City’s surface parking lots were assumed to be resurfaced every 10 years, with the first resurfacing to occur in 2021; this schedule is based on the 10-year useful life of asphalt paving 4. Future capital expenditures related to the structural and mechanical systems of the garages were estimated based on walk-through, visual surveys of each structure and best practices for maintaining these types of facilities over the long-term; more detail on the facility capital expenditure assumptions is presented in section 6.4 of this report

6.2 Optimized Model The intent of creating the Optimized Model was to develop an understanding of how the Parking System can be expected to perform, if the City continues to operate the assets as they have historically, but chooses to upgrade the revenue collection technology in their garages.

The following are the major assumptions which were applied in this financial projection model:

Optimized Model Revenue Assumptions 1. Rates for monthly, transient and metered parking will increase every 10 years by 15%, with the first increase occurring in 2024 2. Fine rates and negotiated lease rates paid by large groups of parkers were assumed to increase on the same schedule as the regular rates 3. Parking demand growth will occur at a rate of 0.50% annually 4. An economic recession will occur, on average, every 7 years, resulting in a decrease in demand and the associated revenue in those years; revenue was assumed to return to its pre-recession level in the year following each recession

Optimized Model Expense Assumptions 1. Despite the Parking Enforcement function being moved to the Finance Department, these costs were assumed in the financial model to show the total financial impact of parking operations 2. Payroll-related expenses were assumed to grow by 4% annually, based on historical trends observed by DESMAN in similar municipalities 3. All non-payroll-related expenses were assumed to grow by 2.5% annually, roughly matching the long-term rate of inflation 4. It was assumed that neither the vacant parking enforcement or cashier positions would be filled

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5. It was assumed that the parking garages would be upgraded with automated revenue collection technology, eliminating the personnel-related costs associated with having cashiers process parking transactions

Optimized Model Capital Expenditure Assumptions 1. The existing revenue control equipment in the parking garages was assumed to be replaced immediately with pay-on-foot stations and pay-in-lane technology in order to automate the processing of parking transactions; this equipment was assumed to be replaced in kind every 10 years thereafter, based on the typical useful life of this type of equipment 2. The remaining mechanical, single-space parking meters that were not upgraded to credit-card- enabled meters were assumed to be upgraded with this technology in 2022 and every 10 years thereafter in kind; the existing multi-space payment kiosks were assumed to be replaced on the same schedule 3. Each of the City’s surface parking lots were assumed to be resurfaced every 10 years, with the first resurfacing to occur in 2021; this schedule is based on the 10-year useful life of asphalt paving 4. Future capital expenditures related to the structural and mechanical systems of the garages were estimated based on walk-through, visual surveys of each structure and best practices for maintaining these types of facilities over the long-term; more detail on the facility capital expenditure assumptions is presented in section 6.4 of this report

6.3 Private Model The intent of creating the Private Model was to develop an understanding of how the Parking System can be expected to perform, if the City outsources the operation to a private entity who is fully responsible for all aspects of the System, including long-term maintenance and equipment replacement, but who has the authority to improve the operations as they see fit.

The following are the major assumptions which were applied in the Private Model:

Private Model Revenue Assumptions 1. Rates for monthly, transient and metered parking will increase every 5 years by 15%, with the first increase occurring in 2021; this schedule of rate increases more closely matches the historical rate of inflation 2. Fine rates and negotiated lease rates paid by large groups of parkers were assumed to increase on the same schedule as the regular rates 3. Parking demand growth will occur at a rate of 0.50% annually 4. An economic recession will occur, on average, every 7 years, resulting in a decrease in demand and the associated revenue in those years; revenue was assumed to return to its pre-recession level in the year following each recession 5. It was assumed that the private operator would hire an additional enforcement person, which would result in a 15% increase in ticket revenue and a 10% increase in meter revenue

Private Model Expense Assumptions 1. Despite the Parking Enforcement function being moved to the Finance Department, these costs were assumed in the financial model to show the total financial impact of parking operations

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2. Payroll-related expenses were assumed to grow by 4% annually, based on historical trends observed by DESMAN in similar municipalities 3. All non-payroll-related expenses were assumed to grow by 2.5% annually, roughly matching the long-term rate of inflation 4. It was assumed that the vacant parking enforcement position would be filled, resulting in an increase in payroll-related parking enforcement costs 5. It was assumed that the parking garages would be upgraded with automated revenue collection technology, eliminating the personnel-related costs associated with having cashiers process parking transactions

Private Model Capital Expenditure Assumptions 1. The existing revenue control equipment in the parking garages was assumed to be replaced immediately with pay-on-foot stations and pay-in-lane technology in order to automate the processing of parking transactions; this equipment was assumed to be replaced in kind every 10 years thereafter, based on the typical useful life of this type of equipment 2. The remaining mechanical, single-space parking meters that were not upgraded to credit-card- enabled meters were assumed to be upgraded with this technology in 2022 and every 10 years thereafter in kind; the existing multi-space payment kiosks were assumed to be replaced on the same schedule 3. Each of the City’s surface parking lots were assumed to be resurfaced every 10 years, with the first resurfacing to occur in 2021; this schedule is based on the 10-year useful life of asphalt paving 4. Future capital expenditures related to the structural and mechanical systems of the garages were estimated based on walk-through, visual surveys of each structure and best practices for maintaining these types of facilities over the long-term; more detail on the facility capital expenditure assumptions is presented in section 6.4 of this report

6.4 Capital Expenditure Assumptions The parking assets owned and operated by the City of New Britain are significant and require regular maintenance and replacement over time to ensure that they can operate safely and efficiently. Each of the three financial performance models include the same anticipated costs associated with parking garage repairs, based on the current age and condition of each asset. These estimates, presented in Table 9, were prepared one of DESMAN’s engineers who is intimately familiar with all of the City’s garages and has years of experience developing these kinds of cost estimates.

It should be noted that all costs in Table 9 are presented in 2016 dollars and that, in the models, the costs have been escalated by 2.5% annually in order to account for the effects of inflation.

Tables 10, 11 and 12 present the three financial models developed for the City of New Britain Parking System.

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Table 9 – Opinion of Anticipated Long-Term Capital Repair and Maintenance Costs for the City of New Britain’s Parking Garages

Item Description Fiscal Year

Years 1-5 Years 6-10 Years 11-15 Years 16-20 Years 21-25 Years 26-30 Years 31-35 Years 36-40 1. Miscellaneous Concrete Repair & Maintenance: a. Concrete Slab-on-Grade Deck Repair $0.00 $13,700.00 $0.00 $13,700.00 $0.00 $13,700.00 $0.00 $13,700.00 b. Precast Concrete Tee Repair $0.00 $58,320.00 $0.00 $58,320.00 $58,320.00 $0.00 $58,320.00 $58,320.00 c. Concrete Stair Repair $0.00 $60,160.00 $0.00 $60,160.00 $60,160.00 $0.00 $60,160.00 $60,160.00 d. Overhead & Vertical Concrete Repair $0.00 $33,200.00 $0.00 $33,200.00 $33,200.00 $0.00 $33,200.00 $33,200.00 e. Concrete Curb Repair $0.00 $19,200.00 $0.00 $19,200.00 $19,200.00 $0.00 $19,200.00 $19,200.00 2. Miscellaneous Waterproofing Repair & Maintenance: a. Crack Sealant Repair $0.00 $7,980.00 $7,980.00 $0.00 $7,980.00 $7,980.00 $7,980.00 $0.00 b. Tee to Tee Joint Repair $0.00 $28,560.00 $28,560.00 $0.00 $28,560.00 $28,560.00 $28,560.00 $0.00 c. Control/Construction Joint Repair $0.00 $2,800.00 $2,800.00 $0.00 $2,800.00 $2,800.00 $2,800.00 $0.00 d. Cove Joint Repair $0.00 $0.00 $4,620.00 $0.00 $0.00 $4,620.00 $0.00 $0.00 e. Building Façade Joint Repair $0.00 $0.00 $29,260.00 $0.00 $0.00 $29,260.00 $0.00 $0.00 f. Expansion Joint Repair/Replacement $0.00 $0.00 $711,000.00 $0.00 $0.00 $711,000.00 $0.00 $0.00 g. Topically Applied Penetrating Sealer/Corrosion Inhibitor or Traffic Bearing Membrance Repair/Recoat $0.00 $1,855,400.00 $0.00 $1,855,400.00 $0.00 $1,855,400.00 $0.00 $1,855,400.00 3. Miscellaneous Metal Repair & Maintenance: a. Stair Railing Repair $22,560.00 $22,560.00 $22,560.00 $45,120.00 $22,560.00 $22,560.00 $22,560.00 $45,120.00 b. Misc. Door, Doorframe & Door Hardware Repair $30,000.00 $30,000.00 $30,000.00 $60,000.00 $30,000.00 $30,000.00 $30,000.00 $60,000.00 4. Miscellaneous Plumbing Repair & Maintenance: a. Clean & Flush Storm Drains $90,000.00 $135,000.00 $90,000.00 $135,000.00 $90,000.00 $135,000.00 $90,000.00 $135,000.00 b. Miscellaneous Storm Drain Repair $22,560.00 $22,560.00 $22,560.00 $45,120.00 $22,560.00 $22,560.00 $22,560.00 $45,120.00 5. Miscellaneous Electrical Repair & Maintenance: a. Lighting Fixture Relamping $57,200.00 $85,800.00 $57,200.00 $85,800.00 $57,200.00 $85,800.00 $57,200.00 $85,800.00 b. Replacement of Lighting Ballasts $0.00 $195,000.00 $0.00 $195,000.00 $0.00 $195,000.00 $0.00 $195,000.00 c. Replacement Lighitng Fixtures $0.00 $0.00 $0.00 $520,000.00 $0.00 $0.00 $0.00 $520,000.00 d. Emergency Lighting Maintenance & Repair $30,000.00 $45,000.00 $30,000.00 $45,000.00 $30,000.00 $45,000.00 $30,000.00 $45,000.00 e. Emergency Exit Signage Maintenance & Repair $30,000.00 $45,000.00 $30,000.00 $45,000.00 $30,000.00 $45,000.00 $30,000.00 $45,000.00 f. Safety & Security Equipment (Fire Alarm, Emergency Intercom, CCTV, etc) $112,500.00 $112,500.00 $112,500.00 $112,500.00 $112,500.00 $112,500.00 $112,500.00 $112,500.00 6. Elevator Maintenance & Repair $75,000.00 $75,000.00 $75,000.00 $75,000.00 $75,000.00 $75,000.00 $75,000.00 $75,000.00 7. Miscellaneous Painting a. Misc. Metals (Doors, Doorframes, Stair Railings, Light Poles, etc.) $0.00 $60,000.00 $0.00 $60,000.00 $60,000.00 $0.00 $60,000.00 $60,000.00 d. Parking Stall & Lane Striping $45,000.00 $45,000.00 $45,000.00 $45,000.00 $45,000.00 $45,000.00 $45,000.00 $45,000.00 8. Signage Replacement $0.00 $0.00 $0.00 $175,000.00 $0.00 $0.00 $0.00 $175,000.00 9. Facility Condition Assessment $30,000.00 $60,000.00 $60,000.00 $30,000.00 $60,000.00 $60,000.00 $30,000.00 $60,000.00 Sub-Total Reapir & Maintenance Costs (See Note Below) $544,820.00 $3,012,740.00 $1,359,040.00 $3,713,520.00 $845,040.00 $3,526,740.00 $815,040.00 $3,743,520.00

Construction Contingency (10%): $54,482.00 $301,274.00 $135,904.00 $371,352.00 $84,504.00 $352,674.00 $81,504.00 $374,352.00 Engineering Fees (10%): $54,482.00 $301,274.00 $135,904.00 $371,352.00 $84,504.00 $352,674.00 $81,504.00 $374,352.00

TOTAL Costs: $653,784.00 $3,615,288.00 $1,630,848.00 $4,456,224.00 $1,014,048.00 $4,232,088.00 $978,048.00 $4,492,224.00

Note: These projected repair and maintenance costs have been developed assuming that the parking facility is to be properly repaired and maintained in accordance with parking industry standards.

Source: DESMAN

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Table 10 – New Britain Parking System Financial Performance Projections – Base Model

2012 2013 2014 2015 2016 2017 Projected 2018 Projected 2019 Projected 2020 Projected 2021 Projected Actuals Actuals Actuals Actuals Actuals Revenue Parking Enforcement 253,040 361,747 270,618 393,939 385,733 390,978 382,455 390,978 390,978 390,978 Liberty Square Parking Garage (Blogoslawski) 617,843 630,384 613,368 660,342 708,394 711,936 699,898 719,073 722,668 726,282 Bank Street Parking Garage (Szczesny) 252,887 221,830 211,232 251,902 262,336 263,648 259,190 266,291 267,623 268,961 Washington Street Parking Garage (Badolato) 55,772 42,062 48,053 42,644 44,954 45,024 44,112 45,166 45,237 45,309 Parking Administration 331,291 276,995 269,413 303,673 295,071 296,217 290,863 298,479 299,618 300,763 TOTAL PARKING REVENUE $1,510,834 $1,533,017 $1,412,684 $1,652,500 $1,696,489 $1,707,804 $1,676,518 $1,719,987 $1,726,124 $1,732,292 Expenses Parking Enforcement 97,647 126,548 66,256 859 34 120,778 124,760 128,882 133,147 137,561 Street Parking Collections (Meters) 91,745 97,585 104,613 107,963 113,037 113,407 117,823 122,412 127,181 132,138 Liberty Square Parking Garage (Blogoslawski) 361,740 366,307 367,827 371,234 385,389 393,780 408,035 422,823 438,165 454,080 Bank Street Parking Garage (Szczesny) 209,322 218,897 234,257 242,180 270,476 257,050 265,654 274,560 283,780 293,324 Washington Street Parking Garage (Badolato) 151,422 159,791 142,899 142,204 158,575 152,408 157,511 162,793 168,261 173,922 Parking Administration 117,268 120,230 96,834 71,712 76,049 73,824 76,760 79,814 82,989 86,292 TOTAL EXPENSES $1,029,144 $1,089,358 $1,012,685 $936,152 $1,003,560 $1,111,247 $1,150,543 $1,191,285 $1,233,523 $1,277,316

NET OPERATING INCOME $481,690 $443,659 $399,998 $716,348 $692,929 $596,557 $525,974 $528,702 $492,601 $454,975 Capital Expenditures Parking Garage Repairs & Maintenance 178,430 2,320,757 1,496,223 223,278 7,952 130,757 134,026 137,376 140,811 144,331 Surface Lot Resurfacing - - - - 116,422 Parking Garage Equipment 5,426 - - - - - Parking Meter Equipment - - - - - TOTAL CAPITAL EXPENDITURES $178,430 $2,320,757 $1,496,223 $228,704 $7,952 $130,757 $134,026 $137,376 $140,811 $260,753 Outstanding Debt Service Series 2012 & Series 2013 - - - - - 402,268 402,279 402,542 402,203 621,125 TOTAL OUTSTANDING DEBT SERVICE $0 $0 $0 $0 $0 $402,268 $402,279 $402,542 $402,203 $621,125 NET INCOME/(LOSS) $303,259 ($1,877,098) ($1,096,225) $487,644 $684,977 $63,532 ($10,330) ($11,216) ($50,413) ($426,902) Source: DESMAN

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Table 10 – New Britain Parking System Financial Performance Projections – Base Model (continued)

2022 Projected 2023 Projected 2024 Projected 2025 Projected 2026 Projected 2036 Projected 2046 Projected 2056 Projected

Revenue Parking Enforcement 390,978 390,978 449,625 439,823 449,625 517,068 581,666 683,823 Liberty Square Parking Garage (Blogoslawski) 729,913 733,563 847,815 833,479 856,315 1,035,123 1,223,990 1,512,546 Bank Street Parking Garage (Szczesny) 270,306 271,657 313,968 308,659 317,115 383,332 453,275 560,135 Washington Street Parking Garage (Badolato) 45,380 45,453 52,354 51,295 52,522 61,398 70,248 84,042 Parking Administration 301,913 303,070 349,867 343,553 352,559 421,400 492,913 602,799 TOTAL PARKING REVENUE $1,738,491 $1,744,720 $2,013,628 $1,976,809 $2,028,136 $2,418,321 $2,822,092 $3,443,345 Expenses Parking Enforcement 142,128 146,854 151,745 156,807 162,046 225,730 316,026 444,602 Street Parking Collections (Meters) 137,290 142,644 148,210 153,994 160,007 234,832 345,027 507,419 Liberty Square Parking Garage (Blogoslawski) 470,592 487,724 505,498 523,940 543,075 778,955 1,121,134 1,618,704 Bank Street Parking Garage (Szczesny) 303,204 313,434 324,025 334,991 346,346 484,711 681,693 963,247 Washington Street Parking Garage (Badolato) 179,782 185,850 192,132 198,637 205,372 287,447 404,303 571,343 Parking Administration 89,726 93,297 97,011 100,873 104,889 155,014 229,164 338,860 TOTAL EXPENSES $1,322,723 $1,369,803 $1,418,621 $1,469,242 $1,521,735 $2,166,691 $3,097,346 $4,444,176

NET OPERATING INCOME $415,768 $374,917 $595,008 $507,568 $506,402 $251,630 ($275,254) ($1,000,830) Capital Expenditures Parking Garage Repairs & Maintenance 818,073 838,525 859,488 880,975 903,000 1,424,789 1,732,115 2,353,543 Surface Lot Resurfacing ------Parking Garage Equipment 550,854 ------Parking Meter Equipment 190,586 - - - 61,819 79,133 101,297 129,669 TOTAL CAPITAL EXPENDITURES $1,559,513 $838,525 $859,488 $880,975 $964,819 $1,503,922 $1,833,412 $2,483,212 Outstanding Debt Service Series 2012 & Series 2013 609,831 567,137 560,485 333,334 325,091 - - - TOTAL OUTSTANDING DEBT SERVICE $609,831 $567,137 $560,485 $333,334 $325,091 $0 $0 $0

NET INCOME/(LOSS) ($1,753,577) ($1,030,744) ($824,966) ($706,741) ($783,507) ($1,252,291) ($2,108,667) ($3,484,042) Source: DESMAN

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Table 11 – New Britain Parking System Financial Performance Projections – Optimized Model

2012 2013 2014 2015 2016 2017 Projected 2018 Projected 2019 Projected 2020 Projected 2021 Projected Actuals Actuals Actuals Actuals Actuals Revenue Parking Enforcement 253,040 361,747 270,618 393,939 385,733 390,978 382,455 390,978 390,978 390,978 Liberty Square Parking Garage (Blogoslawski) 617,843 630,384 613,368 660,342 708,394 711,936 699,898 719,073 722,668 726,282 Bank Street Parking Garage (Szczesny) 252,887 221,830 211,232 251,902 262,336 263,648 259,190 266,291 267,623 268,961 Washington Street Parking Garage (Badolato) 55,772 42,062 48,053 42,644 44,954 45,024 44,112 45,166 45,237 45,309 Parking Administration 331,291 276,995 269,413 303,673 295,071 296,217 290,863 298,479 299,618 300,763 TOTAL PARKING REVENUE $1,510,834 $1,533,017 $1,412,684 $1,652,500 $1,696,489 $1,707,804 $1,676,518 $1,719,987 $1,726,124 $1,732,292 Expenses Parking Enforcement 97,647 126,548 66,256 859 34 120,778 124,760 128,882 133,147 137,561 Street Parking Collections (Meters) 91,745 97,585 104,613 107,963 113,037 113,407 117,823 122,412 127,181 132,138 Liberty Square Parking Garage (Blogoslawski) 361,740 366,307 367,827 371,234 385,389 275,229 284,748 294,611 304,830 315,419 Bank Street Parking Garage (Szczesny) 209,322 218,897 234,257 242,180 270,476 184,268 189,964 195,845 201,919 208,191 Washington Street Parking Garage (Badolato) 151,422 159,791 142,899 142,204 158,575 152,408 157,511 162,793 168,261 173,922 Parking Administration 117,268 120,230 96,834 71,712 76,049 73,824 76,760 79,814 82,989 86,292 TOTAL EXPENSES $1,029,144 $1,089,358 $1,012,685 $936,152 $1,003,560 $919,914 $951,566 $984,357 $1,018,328 $1,053,522

NET OPERATING INCOME $481,690 $443,659 $399,998 $716,348 $692,929 $787,890 $724,952 $735,630 $707,796 $678,769 Capital Expenditures Parking Garage Repairs & Maintenance 178,430 2,320,757 1,496,223 223,278 7,952 130,757 134,026 137,376 140,811 144,331 Surface Lot Resurfacing - - - - 116,422 Parking Garage Equipment 5,426 797,450 - - - - Parking Meter Equipment - - - - - TOTAL CAPITAL EXPENDITURES $178,430 $2,320,757 $1,496,223 $228,704 $7,952 $928,207 $134,026 $137,376 $140,811 $260,753 Outstanding Debt Service Series 2012 & Series 2013 - - - - - 402,268 402,279 402,542 402,203 621,125 TOTAL OUTSTANDING DEBT SERVICE $0 $0 $0 $0 $0 $402,268 $402,279 $402,542 $402,203 $621,125 NET INCOME/(LOSS) $303,259 ($1,877,098) ($1,096,225) $487,644 $684,977 ($542,585) $188,647 $195,711 $164,783 ($203,108) Source: DESMAN

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Table 11 – New Britain Parking System Financial Performance Projections – Optimized Model (continued)

2022 Projected 2023 Projected 2024 Projected 2025 Projected 2026 Projected 2036 Projected 2046 Projected 2056 Projected

Revenue Parking Enforcement 390,978 390,978 449,625 439,823 449,625 517,068 581,666 683,823 Liberty Square Parking Garage (Blogoslawski) 729,913 733,563 847,815 833,479 856,315 1,035,123 1,223,990 1,512,546 Bank Street Parking Garage (Szczesny) 270,306 271,657 313,968 308,659 317,115 383,332 453,275 560,135 Washington Street Parking Garage (Badolato) 45,380 45,453 52,354 51,295 52,522 61,398 70,248 84,042 Parking Administration 301,913 303,070 349,867 343,553 352,559 421,400 492,913 602,799 TOTAL PARKING REVENUE $1,738,491 $1,744,720 $2,013,628 $1,976,809 $2,028,136 $2,418,321 $2,822,092 $3,443,345 Expenses Parking Enforcement 142,128 146,854 151,745 156,807 162,046 225,730 316,026 444,602 Street Parking Collections (Meters) 137,290 142,644 148,210 153,994 160,007 234,832 345,027 507,419 Liberty Square Parking Garage (Blogoslawski) 326,391 337,761 349,544 361,754 374,409 529,389 751,843 1,072,227 Bank Street Parking Garage (Szczesny) 214,670 221,361 228,272 235,412 242,787 331,465 454,909 627,628 Washington Street Parking Garage (Badolato) 179,782 185,850 192,132 198,637 205,372 287,447 404,303 571,343 Parking Administration 89,726 93,297 97,011 100,873 104,889 155,014 229,164 338,860 TOTAL EXPENSES $1,089,986 $1,127,767 $1,166,914 $1,207,477 $1,249,510 $1,763,878 $2,501,272 $3,562,079

NET OPERATING INCOME $648,504 $616,953 $846,715 $769,332 $778,626 $654,443 $320,820 ($118,734) Capital Expenditures Parking Garage Repairs & Maintenance 818,073 838,525 859,488 880,975 903,000 1,424,789 1,732,115 2,353,543 Surface Lot Resurfacing ------Parking Garage Equipment ------Parking Meter Equipment 190,586 - - - 61,819 79,133 101,297 129,669 TOTAL CAPITAL EXPENDITURES $1,008,659 $838,525 $859,488 $880,975 $964,819 $1,503,922 $1,833,412 $2,483,212 Outstanding Debt Service Series 2012 & Series 2013 609,831 567,137 560,485 333,334 325,091 - - - TOTAL OUTSTANDING DEBT SERVICE $609,831 $567,137 $560,485 $333,334 $325,091 $0 $0 $0

NET INCOME/(LOSS) ($969,986) ($788,709) ($573,259) ($444,977) ($511,283) ($849,479) ($1,512,593) ($2,601,946) Source: DESMAN

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Table 12 – New Britain Parking System Financial Performance Projections – Private Model

2012 2013 2014 2015 2016 2017 Projected 2018 Projected 2019 Projected 2020 Projected 2021 Projected Actuals Actuals Actuals Actuals Actuals Revenue Parking Enforcement 253,040 361,747 270,618 393,939 385,733 448,829 439,044 448,829 448,829 516,153 Liberty Square Parking Garage (Blogoslawski) 617,843 630,384 613,368 660,342 708,394 711,936 699,898 719,073 722,668 835,224 Bank Street Parking Garage (Szczesny) 252,887 221,830 211,232 251,902 262,336 263,648 259,190 266,291 267,623 309,305 Washington Street Parking Garage (Badolato) 55,772 42,062 48,053 42,644 44,954 45,024 44,112 45,166 45,237 52,105 Parking Administration 331,291 276,995 269,413 303,673 295,071 317,534 311,820 320,009 321,256 370,886 TOTAL PARKING REVENUE $1,510,834 $1,533,017 $1,412,684 $1,652,500 $1,696,489 $1,786,972 $1,754,064 $1,799,368 $1,805,613 $2,083,672 Expenses Parking Enforcement 97,647 126,548 66,256 859 34 175,168 181,326 187,711 194,329 201,190 Street Parking Collections (Meters) 91,745 97,585 104,613 107,963 113,037 113,407 117,823 122,412 127,181 132,138 Liberty Square Parking Garage (Blogoslawski) 361,740 366,307 367,827 371,234 385,389 275,229 284,748 294,611 304,830 315,419 Bank Street Parking Garage (Szczesny) 209,322 218,897 234,257 242,180 270,476 184,268 189,964 195,845 201,919 208,191 Washington Street Parking Garage (Badolato) 151,422 159,791 142,899 142,204 158,575 152,408 157,511 162,793 168,261 173,922 Parking Administration 117,268 120,230 96,834 71,712 76,049 73,824 76,760 79,814 82,989 86,292 TOTAL EXPENSES $1,029,144 $1,089,358 $1,012,685 $936,152 $1,003,560 $974,304 $1,008,132 $1,043,185 $1,079,509 $1,117,151

NET OPERATING INCOME $481,690 $443,659 $399,998 $716,348 $692,929 $812,667 $745,932 $756,183 $726,104 $966,521 Capital Expenditures Parking Garage Repairs & Maintenance 178,430 2,320,757 1,496,223 223,278 7,952 130,757 134,026 137,376 140,811 144,331 Surface Lot Resurfacing - - - - 116,422 Parking Garage Equipment 5,426 797,450 - - - - Parking Meter Equipment - - - - - TOTAL CAPITAL EXPENDITURES $178,430 $2,320,757 $1,496,223 $228,704 $7,952 $928,207 $134,026 $137,376 $140,811 $260,753 Outstanding Debt Service Series 2012 & Series 2013 - - - - - 402,268 402,279 402,542 402,203 621,125 TOTAL OUTSTANDING DEBT SERVICE $0 $0 $0 $0 $0 $402,268 $402,279 $402,542 $402,203 $621,125 NET INCOME/(LOSS) $303,259 ($1,877,098) ($1,096,225) $487,644 $684,977 ($517,807) $209,628 $216,264 $183,090 $84,644 Source: DESMAN

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Table 12 – New Britain Parking System Financial Performance Projections – Private Model (continued)

2022 Projected 2023 Projected 2024 Projected 2025 Projected 2026 Projected 2036 Projected 2046 Projected 2056 Projected

Revenue Parking Enforcement 516,153 516,153 516,153 504,901 593,576 785,004 883,075 1,193,893 Liberty Square Parking Garage (Blogoslawski) 839,400 843,597 847,815 833,479 984,762 1,368,950 1,861,536 2,645,453 Bank Street Parking Garage (Szczesny) 310,851 312,406 313,968 308,659 364,683 506,957 689,375 979,679 Washington Street Parking Garage (Badolato) 52,188 52,271 52,354 51,295 60,401 81,199 97,711 134,651 Parking Administration 372,334 373,789 375,252 368,510 434,929 598,291 784,548 1,105,322 TOTAL PARKING REVENUE $2,090,926 $2,098,216 $2,105,542 $2,066,844 $2,438,350 $3,340,401 $4,316,244 $6,058,998 Expenses Parking Enforcement 208,302 215,675 223,319 231,244 239,460 340,322 485,650 695,687 Street Parking Collections (Meters) 137,290 142,644 148,210 153,994 160,007 234,832 345,027 507,419 Liberty Square Parking Garage (Blogoslawski) 326,391 337,761 349,544 361,754 374,409 529,389 751,843 1,072,227 Bank Street Parking Garage (Szczesny) 214,670 221,361 228,272 235,412 242,787 331,465 454,909 627,628 Washington Street Parking Garage (Badolato) 179,782 185,850 192,132 198,637 205,372 287,447 404,303 571,343 Parking Administration 89,726 93,297 97,011 100,873 104,889 155,014 229,164 338,860 TOTAL EXPENSES $1,156,160 $1,196,588 $1,238,487 $1,281,914 $1,326,924 $1,878,470 $2,670,896 $3,813,164

NET OPERATING INCOME $934,766 $901,628 $867,055 $784,930 $1,111,426 $1,461,931 $1,645,348 $2,245,833 Capital Expenditures Parking Garage Repairs & Maintenance 818,073 838,525 859,488 880,975 903,000 1,424,789 1,732,115 2,353,543 Surface Lot Resurfacing ------Parking Garage Equipment ------Parking Meter Equipment 190,586 - - - 61,819 79,133 101,297 129,669 TOTAL CAPITAL EXPENDITURES $1,008,659 $838,525 $859,488 $880,975 $964,819 $1,503,922 $1,833,412 $2,483,212 Outstanding Debt Service Series 2012 & Series 2013 609,831 567,137 560,485 333,334 325,091 - - - TOTAL OUTSTANDING DEBT SERVICE $609,831 $567,137 $560,485 $333,334 $325,091 $0 $0 $0

NET INCOME/(LOSS) ($683,725) ($504,034) ($552,919) ($429,379) ($178,483) ($41,991) ($188,064) ($237,379) Source: DESMAN

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7.0 Other System Enhancements Considerations

Regardless of the operating model pursued by the City, we suggest consideration of the following changes which would enhance the operating and financial performance of the system

Adding additional meters – There is potential to increase revenue and improve on-street turnover by adding meters in select areas. Two areas for consideration include Arch Street south of Pearl Street and Broad Street between Gold Street and Beaver Street in Little Poland. These two segments of street are both in commercial corridors and were highly occupied during DESMAN’s site visit. There is potential to add between 90 and 100 metered spaces. Assuming that the new meters generated revenue at even half the average annual rate of the existing meters, they would add approximately $300 per metered space in revenue. At an assumed cost of $550 per space for new, single-space meters, these spaces have the potential to pay for themselves in 2 years and generate net revenue after that; enforcement revenue would add to the total. If currently-underutilized meters were relocated to these spaces, as opposed to purchasing new meter equipment, the payback period could be greatly reduced.

Assuming 100 metered spaces equipped with new, single-space meters, earning $300 per year, the approximate cost to acquire the meters would be $55,000 and the first year revenue would be $30,000.

Adding an additional enforcement position – The loss of one enforcement position has coincided with a significant reduction in violations issued. In general, enforcement positions more than pay for themselves. We strongly recommend consideration of adding another position. Assuming that this individual would receive a similar salary and benefits as the current enforcement personnel, the approximate cost of this person would be $55,000 per year.

In FY 2016, each of the two current enforcement personnel issued approximately 4,200 parking violations, resulting in approximately $192,000 in ticket revenue received per person. If we made the very conservative assumption that a third enforcement person would issue only half as many violations, that could equate to potentially $96,000 in additional ticket revenue.

Saturday enforcement and garage operation – With automated garage equipment, it is both possible and inexpensive to charge for off-street parking on weekends and evenings. Enforcement of metered parking in areas that are active after 5PM and on weekends should be considered.

Simplify monthly rate schedule to consolidate categories – The existing monthly permit system is overly complex. Many employers have negotiated a separate rate for the same service. We recommend that the number of rates be consolidated and the average be increased to provide adequate funding to offset the garage operating expenses.

Relative to the City and Board of Education employees, the 250 spaces used by these individuals have an implied market value of $10,000 per month ($40 per permit), while the City currently receives approximately $3,750 per month ($15 per permit) in revenue. Similarly, assuming the same $40 per month, per space for the approximately 200 spaces used by the Police Department, this parking has an implied market value of $8,000 per month.

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Reduce full day transient rates – The existing daily transient rates are very high relative to the benchmarked communities. At $15 per day or $80 per month, it pays to purchase a monthly permit if you park for 5 days a month. Consideration should be made to reducing the daily rates.

Outsourcing security – One of the major labor expenses covers garage security by City employees. Consideration should be given to outsourcing this service to a firm that specializes in security and can provide it at a reduced rate.

Lighting upgrades in Szczesny and Blogoslawski – Lighting upgrades typically pay for themselves within five years by reducing energy use and, at the same time, improving the look and feel of the garage. We recommend installing new lighting in the two garages which have not had upgrades. Upgraded lighting for the Szczesny garage would cost about $350,000 and for Blogoslawski about $500,000, excluding any grants or incentives from the electric company. Assuming that lighting upgrades would result in a 25% reduction in electricity costs, as was the case at the Badolato Garage, the result could be an annual cost savings of approximately $40,000 between the two garages.

Notes

The financial analysis of the subject parking system presented in this report represents a series of analyses, estimates, and projections, based on certain available data and reasonable expectations of macroeconomic trends. Although we have reviewed the system’s historical performance and the currently available data regarding general economic trends in the market area, and have developed projections of future performance, it is important to note that unforeseen circumstances can cause deviations from projections. Although these are unlikely to occur, it is not possible to anticipate all conditions. The financial information included in the report was prepared by DESMAN. These financials have not been prepared in compliance with Generally Accepted Accounting Principles and were not audited in any manner.