1. 1 Fall 2008 and Fall 2009 Parking Permit Fee Proposal February 2008

2. 2 Current Financial Requirements Reserve requirements –TAMU Rule 23.02.02.M1, dated April 24,2006, requires that all university auxiliary departments maintain a three month operating reserve –In addition, the rule requires the auxiliary to maintain 115% of the succeeding year’s annual debt service payment as funds not allocated or budgeted for any other purpose

3. 3 Current Financial Requirements Deferred maintenance/capital renewal –Estimates suggest that $2M/year is needed to address deferred maintenance –In addition, $1M/year is needed going forward for capital renewal New budget assessments began in FY07 –Auxiliary assessments in the amount of $387K –Group Insurance Premium assessment in the amount of $74K

4. 4 Current Financial Requirements Increased utility costs –Utility costs for parking are expected to increase from $394K in FY05 to $662k in 2006 to $972K in FY07. They are expected to remain in the $1M range for the next few years. The savings from the reduction in force and reorganization have been offset by the new assessments and increased utility costs

5. 5 Financial Impact of the Increase

6. 6 Proposed FY08-FY11 Rates Compared to FY06-FY07 Rates

7. 7 Proposed Strategy The recommended strategy was to increase parking permit fees in FY08, FY09 and FY10 –Eliminate free parking and services (e.g. retirees, university vehicles, traffic control services) special events incl. football ($2 per space increase FY08) business permits ($25 FY08) –Begin to address the deferred maintenance/capital renewal needs Completed a detailed assessment of every parking lot and garage on campus and ranked them according to condition –Lots in the worst condition: 1, 23, 30, 32, 36, 37, 38, 47, 51, 50, 55, 61, 64, 72 and 100j –Begun replacement of expansion joints in Southside Garage –Planning phase for rebuilding Lot 1 at the Connally Building –Researching means of reducing construction costs

8. 8 Proposed Strategy –The proposed strategy will meet reserve requirements as required by TAMU rules within 5 years –Maintain current service levels –More closely align fee structure with service levels $25 Business Permit fee had 10% reduction in the number of Business Permits TSAC continues to discuss the Business Permit program –Achieve long term financial sustainability

9. 9 Rationale for Specific Increases Reserved numbered spaces –Higher level of service –Higher cost of enforcement –Lower utilization of spaces Reduced WCG rate –Replaces overnight parking in Lot 100, which is a problem for special events –Increased usage of WCG (5400 permits) –Moves students from Reed Arena (Lot 100) –Gives access on football game days (abuse)

10. 10 Rationale for Specific Increases Faculty/Staff surface lot –Adjusts the price differential between student and faculty/staff parking which maintains University business overlays –Currently offered at $25, a small reduction in the cost born by other permit holders –Reduces utilization of visitor and permit parking areas

11. 11 Proposed Project Costs FY08 - FY11

12. 12 Visitor Parking Demand Increased daytime demand in garages Desire for consistent pricing on campus Lot 72 overcrowding after 7pm Desire for increased access to Evans Library Desire for increased access to UCG for student activities at night

13. 13 Visitor Parking Strategies Daytime rate increase Nighttime rate decrease Add visitor spaces on the north side of campus Move business and campus permits above the gates in University Center and Northside Garages Allow departmental reservations above the gates in University Center and Northside Garages

14. 14 Visitor Parking Rates Location Daytime:Hours UCG, CCG, NSG, Lot 72 1/211 1/222 1/233 1/244 1/255 1/266 1/277 1/28 (Present Rates) $ 2.00 $ 3.00 $ 4.00 $ 4.50 $ 5.00 $ 5.50 $ 6.00 $ 6.50 $ 7.00 $ 7.50 $ 8.00 $ 8.50 $ 9.00 $ 9.50 $ 10.00 (Proposed Rates) $ 2.00 $ 4.00 $ 5.00 $ 6.00 $ 6.50 $ 7.00 $ 7.50 $ 8.00 $ 8.50 $ 9.00 $ 9.50 $ 10.00 $ 10.50 $ 11.00 7.34% 17.01%24.87%15.60%9.34%6.16%4.82%3.25%2.30%1.91%1.33%1.03%0.88%0.69%0.53%0.46% Transient Duration Percentage of Total (Taken from UCG over 2 month period) WCG (Present Rates) $ 1.00 $ 1.50 $ 2.00 $ 2.25 $ 2.50 $ 2.75 $ 3.00 $ 3.25 $ 3.50 $ 3.75 $ 4.00 $ 4.25 $ 4.50 $ 4.75 $ 5.00 (Proposed Rates) $ 2.00 $ 4.00 $ 5.00 $ 6.00 $ 6.50 $ 7.00 $ 7.50 $ 8.00 $ 8.50 $ 9.00 $ 9.50 $ 10.00 $ 10.50 $ 11.00 Nighttime:Hours UCG, CCG, NSG 1/211 1/222 1/233 1/244 1/255 1/266 1/277 1/28 (Present Rates) $ 1.00 $ 1.50 $ 2.00 $ 2.25 $ 2.50 $ 2.75 $ 3.00 $ 3.25 $ 3.50 $ 3.75 $ 4.00 $ 4.25 $ 4.50 $ 4.75 $ 5.00 (Prposed Rates) $ 0.50 $ 1.00 $ 1.50 $ 2.00 $ 2.50 $ 3.00 $ 3.50 $ 4.00 WCG (Present Rates) $ 0.50 $ 0.75 $ 1.00 $ 1.25 $ 1.50 $ 1.75 $ 2.00 $ 2.25 $ 2.50 $ 2.75 $ 3.00 $ 3.25 $ 3.50 $ 3.75 $ 4.00 (Proposed Rates) $ 0.50 $ 1.00 $ 1.50 $ 2.00 $ 2.50 $ 3.00 $ 3.50 $ 4.00 Lot 72 (Present Rates) $ - (Proposed Rates) $ 0.50 $ 1.00 $ 1.50 $ 2.00 $ 2.50 $ 3.00 $ 3.50 $ 4.00

15. 15 Appendix Parking Permit Pricing History How Do We Compare to Other Universities? How Do We Compare to Other Big 12 Schools? Debt Service Challenges Cost Savings/Reductions Proposed Strategies Financial Impact of the Increase Pre-tax Parking Fee

16. 16 Parking Permit Pricing History Over the last 17 years, there have been 8 price increases: FY91, FY96, FY00, FY03, FY04, FY05, FY06, and FY08 Over that same period, demand for services and new parking facilities increased Historically, there has been no real strategy to guide parking fees

17. 17 Parking Permit Pricing History

18. 18 How Do We Compare to Other Universities?

19. 19 How Do We Compare to Other Big 12 Schools?

20. 20 How Do We Compare to Other Big 12 Schools? (details)

21. 21 Debt Service Challenges Addition of West Campus Garage (WCG) and Pedestrian Passageway in FY05 added significant debt service and negatively impacted reserve balances: –Approximately $3MM annual debt service for these two projects

22. 22 Debt Service Challenges –Planned gradual rate increases were proposed that would cover the additional debt service costs Instead a 6% across the board increase was approved for three years (FY03 – FY05) These increases did not generate enough revenue to cover the additional debt service –Additional surface lots were built and expanded during WCG construction, which added the capacity to compete with WCG

23. 23 Cost Savings/Reductions In August 2005, the department experienced a reduction in force and reorganization: –33 positions were eliminated –Cost savings were approximately $1M Despite this reduction, the same level of service has been maintained by introducing technology (e.g., paying and appealing on line and pay by space machines in pay lots rather than cashiers) and consolidation of duties and functions

24. 24 Proposed Strategy The alternatives left to address the current financial requirements are to: a) increase revenues, b) decrease services, or c) a combination of the two

25. 25 Financial Impact of the Increase FY08 Required Reserves: Operating Reserve $2.1M Debt Service $7.3M Total Reserve Requirement $9.4M

26. 26 Pre-tax Parking Fee Pre-tax option implemented FY08 5% increase from FY07 to FY08 in total number of participants Approximate $140K benefit savings per year to TAMU 99.8% of Payroll Deduction is done pre-tax

27. 27 For Additional Information http://transport.tamu.edu/parking/announce/08P arkingForums.aspx