Things I'm Not Quite Sure About pt. 2

I'm not quite sure about the proposal to sell or lease Pittsburgh's parking garages to a private firm in order to provide cash to fund the ongoing pension obligations.

So the primary reason to do this, of course, is to offset the huuuuuuge deficit we have in the pension fund, about $600 million or so right now, based on my hasty math. That amount is bad and it's eating into the City's ability to do other stuff or lower local taxes, depending on which side of the economic coin you favor.

Now, the problem is that the pension obligation isn't really going down (well, unless there's a culling of the the retiree population). A pension obligation will continue into the foreseeable future, so a one time sale will provide a one time influx of cash. This will balance the budget in the short term, but will not necessarily be a sustainable solution.

I suppose there's a long term solution if the City wisely invested this money in the stock market (*snicker*) or some sort of (*chuckle*) investment bank or (*guffaws*) municipal credit default swaps. (*wipes tears from eye*) But seriously folks, they might as well just invest in Hummel figurines.

Let's step back a second. Is this kind of sale even really legal? Isn't the Parking Authority a separate legal entity? Isn't its obligation to its own bond holders and not the City's? I can't really wrap my heads around what amounts to parents telling their kids to pay the parents' credit card bills. Maybe it's just me.

And finally, I'm not the kind of person that believes that the government should own everything, but what the parking tax debacle has taught us is that the private market understands that the price of parking in Downtown is sticky. When the tax went down, prices in private lots stayed up; only the Parking Authority (after political pressure, admittedly) reduced their rates. So, I can see some advantage to keeping some measure of control on these prices for the public good.

Again, I'm not quite sure of all this and I hope folks that understand this kind of stuff more than me will be able to work it out. (*snicker*)