Parking fees tied to ABM contract, Farmville council learns

Published 9:36 am Tuesday, June 11, 2024

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It’s not just the proposed fines that Farmville residents have been upset about. Since the cost of parking fees in downtown rose in late May, the Herald has received multiple emails, posts, phone calls and Facebook messages, all annoyed over the change. And we weren’t the only ones getting those calls. 

“I’ve received probably 15-20 complaints, some of them so ugly I don’t dare repeat (what was said),” Farmville council member Thomas Pairet told his colleagues at the board’s Wednesday, June 5 work session. 

As of May 31, any spot with a parking meter in Farmville is $1 per hour. Now after the first hour, you can add time at a rate of an extra 30 minutes, but that first payment has to be $1 right now. To appease some of the irate residents, Pairet proposed a secondary plan, allowing people to put a quarter in for 15 minutes. And while some other council members were open to changing the fees, it’s not as simple as a quick vote, thanks to previously agreed upon contracts. 

Signing a deal with ABM

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Last fall and winter, we covered the council’s discussions with ABM Building Solutions, to look at energy efficiency. The council wanted to be more energy efficient and save money where possible. ABM did a comprehensive technical audit, with results presented to the council last November, detailing areas where the town needed to make upgrades. Over a 20-year period, they projected significant savings in multiple areas. For example, by letting ABM make the changes and replacements with the water meters, Farmville would save $4.36 million over 20 years. That’s $4.36 million combined, not annually. 

ABM detailed similar projected savings at every building and location operated by the town, looking at the HVAC systems, water meters, roof conditions, electric vehicle charging stations and yes, parking meters. 

ABM then gave the council a proposed contract in December, one where they would provide and install the needed upgrades. That includes things like the full electric vehicle charging stations at the Plaza Lot and Farmers’ Market, the thermostat replacements at the sports complex and the new parking meters. There are multiple other work projects included in this, such as HVAC work at the sports complex, roof upgrades at the bus facility and LED lighting at the public works department. 

The town council unanimously agreed to the contract during their Dec. 13 meeting, with Pairet making the motion and Donald Hunter as a second. 

This is where the parking meter fees come in. As part of the contract, the Farmville council agreed to three things when it comes to the meters. First, they agreed to let ABM replace the older meters with newer versions that would accept debit or credit cards. Second, they accepted ABM’s suggestion to increase parking fees to $1 per hour. And third, they agreed to a series of rate increases over the next 20 years. 

“Parking rate increase projected to increase 50 cents every five years, starting on Year 5 through Year 20,” the contract says. 

If that’s followed, it means a price hike to $1.50 per hour in 2028, then up to $2 per hour in 2033, finally arriving at $3 per hour in 2043. 

Those price hikes are required in order to see the projected total increased revenue that ABM estimated of $1.64 million. Again, just like the water meters, this is a combined estimate of increased revenue over the full 20-year-period. The increase for 2024 from the parking changes is projected to be $27,401. 

Parking fees, other considered changes 

Pairet asked in Wednesday’s work session if the town could revisit the rates in the contract and possibly bring in ABM for some discussion. Farmville Town Manager Dr. Scott Davis pointed out the council had already agreed to the current terms back in December. Any changes made now could potentially violate terms of the contract.  

“I mean we’ve already signed the agreement and (the meter fees) was part of the calculation of how it was figured,” Davis said. “I don’t know how you can change that.” 

The issue, Davis pointed out, is that if you lower the amount of money Farmville is receiving, then it throws all of the revenue projections out of sorts. At that point, there would be no guarantee Farmville would get the projected benefits. 

The total project stands at a cost of $7.8 million. The expected revenue growth/savings comes out to $10 million, giving Farmville a $2.2 million benefit. Again, this is combined, adding up all growth in these areas over the next 20 years. If you change the rates, even if ABM agrees to do that, then that $2.2 million gets smaller. 

“When we signed the contract with ABM for this whole project, the idea was that all these things had to be followed in order to see the return at the end,” Farmville Mayor Brian Vincent said. “So the agreement was all of these things lumped together, the parking meters, the water meters, the EV chargers, the energy efficiency measures for the buildings, and all of those things collectively are in that contract. We fulfill all of our obligations and we reap the reward of that revenue saved.”  

Now there is some protection built into the contract for Farmville. If the town fulfills all of its obligations, if it changes parking fees as requested, sets the water rate and does everything else but still doesn’t see that projected revenue growth/savings, ABM has to make up the difference. 

“The whole point of it is if we don’t make that savings, they’re obligated to pay us,” Davis told the council Wednesday. “But if us not getting that savings is because of our inaction, then they’re not going to pay us.” 

In other words, if the revenue growth drops because the town lowered rates below what was agreed to in the contract, ABM has no responsibility to make up the difference. 

Making payments

Also, there’s the issue of paying for the upgrades. In order to do that, the council agreed to a $4.896 million 30-year loan with Bank of America, at a 4.695% interest rate. Regardless of if parking fees get lowered, that loan will still be due to be paid back. 

The council asked Davis to go over the contract and talk with ABM, to see if changing parking meter rates would affect the rest of the contract.