PPP – Will it Work at the University Level?

February, 2012

Sarah Blouch of Ohio State University will lead a panel discussing public-private partnerships during the PT-sponsored Parking Industry Exhibition (PIE) March 18-21 in Chicago. Editor.
How hard can running a parking organization be? Motorists park, they pay, they leave. It’s that simple, right? And on a university campus, where there is a captive audience, it looks even easier.
With this concept in mind, public-private partnerships (PPP’s) have become a popular topic with many university leaders as they look ahead to inevitable declining state and federal funding.
They are looking at anything that’s not core to their teaching and research missions, and evaluating whether the function should continue or if it has a value that can be sold or leased either to save costs or generate money.
Leasing campus parking through a long-term concession agreement appears to provide the best of both worlds. A significant amount of upfront cash that can be used to address university goals is generated immediately, and the services all remain exactly the same. Or do they?
In evaluating this type of agreement, it’s important to keep in mind the rather special needs and desires of parking clientele at universities, which are a bit different from those of traditional public parking facilities. There is a very high expectation among the various customer groups that the institution meet their parking needs.
Because the users of university parking facilities are also university clientele, they generally understand the trade-offs that need to be made from time to time in order to balance the needs of parking with other institutional requirements. Navigating the politics, providing high levels of service to customers, and accommodating all the special / unique needs of those customers (and the institution) is no small task, and requires an extraordinary level of engagement and partnership.
Most campuses view parking as a means to facilitate other university purposes. Although operated as an auxiliary, parking is not viewed as a business end unto itself, but rather as a support operation of a larger transportation system servicing various needs. Profit maximization has never been an operational imperative; often, parking is given away to benefit the greater good of the institution.
When looking at a long-term lease of parking, the allure of the initial cash payment needs to be balanced against the risks if operational requirements are not met, parking land is needed for other uses, or other events occur that may result in the university having to compensate the operator.
Compounding the complexity, the university’s parking department is usually combined with another such as Transportation or Public Safety, and often the parking staff ends up performing a variety of ancillary functions that may be unrelated to the specific act of parking, such as addressing construction impacts, traffic- or transportation-demand management.
Many of these functions are supported by parking revenue, and are “handed” to the department to manage in the absence of skills or funding in other campus areas.
Defining exactly which functions could be “concessioned” and which remain with the university is a daunting task. When you think about the changes that have occurred in the past 50 years (anyone seen a pay phone lately?), how are those potential new changes predicted for the next 50 years? Most university transportation systems are set up to function as an integrated whole.
Wayfinding, traffic flow, transit systems, parking policies and parking locations all reinforce and influence one another. By introducing a third party into the parking component, a university must reevaluate the purposes, function and funding models of the other parts of the system.
For example, quick decisions and customer complaints that may have been addressed by one department might now require multiple stops. Before consummating any agreement, accountability for transportation problems must be clearly defined or decision-making may be fractured to the point where no department has the ability or responsibility to solve the issue.
When run well, a university parking operation makes going to and from campus a non-event. Behind the scenes, however, there are parking professionals who work hard to make it seem so easy.
Part of the challenge of any university parking concession discussion is educating the campus community on the services the department provides and considering the cost implications of those services as they relate to a private operator’s willingness to perform them.
Application-based learning outcomes include:
• Consider the implications of transferring parking land and facilities to private control under a long-term lease, both in terms of service for the campus community and the use of land for further growth and development.
• Reflect on the changes in working relationships and processes when operating departments must work out changes in a paid, private environment, rather than within the university community.
• Consider how planning and operations might change as universities use public-private partnerships to raise funds and perform functions.
• Learn about an approach to articulating and isolating the different service functions that support parking from other university business.
• Evaluate options for first explaining this often foreign concept to a diverse customer base, then defining the unique requirements and addressing concerns and questions, as well as creating operating standards that meet the multiple needs of the institution.
Sarah Blouch is Executive Director of OSU Transportation & Parking Services in Columbus, OH. The PIE discussion panel she will lead (“PPP – Will it work on the university level?”) will be Tuesday morning, March 20, when campus officials, consultants and vendors weigh in on this touchy topic.