sr-072710-1p~ City Council and
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Report
City Council and Redevelopment Agency Meeting: July 27, 2010
Revised July 26, 2010 Agenda Item: f
To: Mayor and City Council
Chairperson and Redevelopment Agency
From: Carol Swindell, Finance Director
Subject: Proposed Macerich Public Valet Program
Recommended Action
Staff recommends that the Council and Redevelopment Agency (Agency):
1) Authorize the City Manager and Executive Director to negotiate and execute a
short term interim agreement with Macerich for use of 143 parking spaces in the
North Civic Center Lot, across from City Hall, for car storage for a public valet
program for a term of three months with three one-month renewal options at the
rate of $6,101.50 per month; and
2) Authorize the City Manager and Executive Director to negotiate and execute a
two year agreement with three one year options to extend with Macerich
authorizing storage of 143 public valet parked vehicles in Parking Structure 8 and
the Civic Auditorium Lot and for the installation of a parking guidance system in
Parking Structures 7 and 8 and direct staff to return to Council with any
necessary regulatory approvals or code changes needed, if any, to implement
the operation of the valet program.
Executive Summary
Parking ,Structures 7 and 8 at Santa Monica Place, owned by the Redevelopment
Agency, were built in 1979, providing 1,968 spaces for the Downtown. Since receiving
seismic upgrades in 2002 and 2003, no additional capital improvements were made to
these two parking facilities until the improvements made in 2010 as part of the Macerich
property's remodel. Public valet parking was envisioned to be integrated into the
remodeled structures. After detailed discussions with Macerich regarding the operations
of parking Structures 7 and 8, staff and Macerich identified an alternative plan for public
valet operations which includes dedicated spaces in Parking Structure 8 and the Civic
Auditorium Lot and the installation of a parking guidance system, paid for and
maintained by Macerich. In review of the proposed deal points, staff has identified
several possible regulatory issues, including the need for California Coastal
Commission approval and potential municipal code changes. With the outstanding
issues associated with the proposed longer-term agreement, staff recommends
authorization to enter into an interim agreement first which would generate revenue of
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$6,101.50 per month while diligently pursuing the longer term agreement which would
generate approximately $42,000 in additional revenue per year.
Background
On March 11, 2008, Council and the Agency considered a variety of issues related to
Parking Structures 7 and 8, including public valet operations. At that meeting, Council
and the Agency considered Macerich's proposal to operate a public valet parking
program upon the re-opening of Santa Monica Place. Macerich proposed to operate a
valet program for any member of the general public (public valet) by parking vehicles in
Structures 7 and 8, Monday through Friday, from 8 a.m. to 6 p.m. During other hours
(evenings and weekends when retail parking demand is highest), public valet vehicles
would be parked in private parking facilities. Currently, the City allows public valet
parking as one element of a coordinated parking system, and regulates public valet
parking operations citywide. Similar to the other public valet services in the downtown,
Macerich's proposed program would be subject to the City's public valet parking permit
requirements and applicable fees.
Macerich's public valet program, which would be implemented upon the re-opening of
Santa Monica Place, was distinguished by its proposal to use Structures 7 and 8 to park
patrons' vehicles. Council directed staff to ensure that the valet operation was in
compliance with the Santa Monica Municipal Code -Public Valet Parking Ordinance
Chapter 6.120, to allow public valet parking to take place in a publicly owned parking
structure with the following requirements:
1) Access to the parking spaces at Parking Structure 7 and 8 remain open to the
public and not limited to the exclusive use of Macerich.
2) Ensure the public valet program will not adversely affect downtown circulation.
3) Ensure the public valet program will not significantly compromise revenue
collection or circulation within the parking structures.
4) Ensure the daytime public valet program complies with the requirements of the
City's existing public valet parking ordinance.
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5) Require patrons of Macerich's proposed public valet program to pay the same
standard fees that apply to self parkers, including two hours free, with whatever
surcharge Macerich determines is necessary to defray the costs of providing the
public valet service.
Current Agreement
Following Council's direction of March 2008, the Agency and Macerich currently have a
parking agreement that provides for the following:
278 non-dedicated general parking spaces in Structures 7 and 8, Monday
through Friday, and in the Civic Structure on Saturdays and Sundays.
• Parking revenue from structure 7 and 8 is split 50/50 between Macerich and the
City after expenses.
• Valet operations are allowed to park inside Structures 7 and 8 from 8:00 am to
6:00 pm in any available space.
• At 6:00 p.m., all valet parked vehicles must be removed from the structure and
moved to a nearby private lot.
Discussion
Similar Los Angeles-area shopping and dining destinations offer valet parking for
shoppers and diners; valet parking has become a standard amenity. Over the past
month, Macerich staff has met with City staff to discuss details of how to best implement
the public valet system, provide a pleasant experience to visitors, and minimize its
impact on parking and traffic. In the course of discussions, Macerich presented a
proposal to lease spaces within Parking Structure 8 and the Civic Auditorium Lot for
valet car storage at all hours. This approach would help traffic by eliminating the need to
move all valet-parked vehicles in Structure 8 to an offsite location at 6:00 p.m. In
addition, Macerich proposed installing and maintaining, at its cost, a parking guidance
system to allow customers to locate available spaces and to inform customers of
available spaces by level. Parking guidance systems are becoming commonplace tools
to provide better customer service.
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Staff and Macerich agree that providing all-day dedicated public valet parking spaces in
Structure 8 and in the Civic Auditorium Lot would assist in the operations of a public
valet, as well as keep a number of key day-time spots in downtown structures available
to the public, and prevent public valets from adding to congestion within the structures.
At this point, staff recommends the following:
1) Use of 43 of Macerich's existing 278 dedicated spaces in Parking Structure 8
beginning at $60.50 per month which is equivalent to one-half of the standard
monthly rate for a public valet program. As revenue from parking spaces ih
Structures 7 and 8 is split equally between Macerich and the City, Macerich's use
of 43 dedicated spaces in Structure 8 would not result in reduced revenue for the
City.
2) Use of 100 new spaces in the Civic Auditorium Lot at $35 per space per month
for the length of the agreement for a public valet program. The amount per space
is reduced from the current monthly rate of $163 per space per month currently
charged. in the Civic Auditorium-Lot due to Macerich's investment in the parking
guidance system below.
3) Macerich will pay 100% of the cost for the installation of Park Assist Parking
Guidance System valued at $1.4 million in Structures 7 and 8. This camera-
based system would alert customers to available spaces by level, reducing
congestion. The system would be installed as part of the final agreement, if
executed, with no reimbursement from the City to Macerich.
4) Term would be 2 years with 3 one year options.
Parking Guidance System
The proposed parking guidance system requires an initial investment of $1.4 million
plus ongoing maintenance, both of which will be paid for by Macerich, with no cost to or
reimbursement from the City. The system will inform customers of available parking
spaces by level and within each level; customers will be directed to available parking via
a red and green light indicator above each space. Additionally, the system has the
capability for a parking customer to go to the security personnel for assistance in
locating their vehicle.
Staff is currently exploring various parking guidance systems to install in the remainder
of the downtown structures, the costs of which are anticipated to be requested during
the Fiscal Year 2011(12 budget process. Installation of this system in Parking Structures
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7 and 8 does not predetermine which system will be installed in the remaining
structures.
Next Steps
Following review of the recommended approach by the City Attorney's office, some
regulatory questions were raised, which may require additional time to resolve.
Coastal Commission
Due to the location of Parking Structure 8 and the Civic Auditorium Lot in the Coastal
Zone, Coastal Commission approval is necessary before dedicated public valet spaces
can be approved. Staff will work with Macerich to seek its approval of the dedicated
public valet spaces.
CEQA
The proposed parking management public valet program is exempt from the provision
of CEQA pursuant to CEQA Guidelines Section 15061(b)(3) in that it can be seen with
certainty that the proposal will. not result in significant adverse environmental impacts
since the public valet program only represents an operational change to the use of the
existing parking spaces and will not result in the creation of any new parking demand.
Interim Agreement
In order to ensure staff and Macerich have sufficient time to address the Coastal
Commission process and to bring forward any necessary ordinances that may be
needed, staff recommends that Council authorize an interim agreement for the use of
143 spaces in the North Civic Center Lot, across from City Hall, for use by the public
valet at Santa Monica Place for three months with three one month options to extend.
During periods where it is necessary to complete pre-development work in the lot in
preparation for the design of the park, staff will relocate the valet to a designated facility
in or near the Civic Center. This will allow staff to maximize the use of existing City
parking resources during the peak. summer period and the mall's reopening. Macerich
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will be required to comply with standard valet requirements, including an approved
traffic control plan. Following execution of the Interim Agreement, staff will work with
Macerich to finalize an agreement within the parameters discussed above and will
return to Council for authorization to enter into any necessary agreements, and align
with any necessary code modifications.
Financial Impacts & Budget Actions
The Interim Agreement would generate approximately $6,101.50 per month for a total of
$36,609, if all options are executed. If executed, the longer term agreement would
generate approximately $42,000 in additional revenue, including $38,000 for the Civic
Auditorium Fund and $4,000 for the General Fund via the Parking Tax. The City also
will receive a Park Assist Parking Guidance System valued at $1.4 million.
Prepared by: Donald Patterson, Business & Revenue Operations Manager
Approved:
Carol Swindell
Finance Director
Forwarded to Council:
Rod Gould
City Manager
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Reference Contract Nos.
9248 (CCS/RAS) & 9249
(CCS/RAS).