Clout-heavy firm gets contracts for parking at O’Hare, Midway
BY FRAN SPIELMAN City Hall Reporter email@example.com August 16, 2012 2:26AM
Updated: September 17, 2012 1:02PM
Mayor Rahm Emanuel’s administration has awarded $203 million in contracts to manage parking and ground transportation at O’Hare and Midway Airports to a clout-heavy company that’s had a lock on the business for nearly two decades.
Standard Parking was one of four companies vying for the five-year, $145 million O’Hare contract in a field that included LAZ Parking, the operator hired by the consortium that paid $1.15 billion to lease Chicago’s 36,000 parking meters for 75 years.
In the competition for the five-year, $58 million Midway parking contract, Standard beat out a four-member field of competitors that included LAZ, Imperial Parking and CPS Chicago Parking LLC.
Standard Parking served as an O’Hare parking consultant for much of the 1980s before assuming control over the entire operation in 1993 in exchange for a $250,000-a-year management fee, plus incentives for generating additional revenue.
The company promised to save the city $3 million-a-year and usher in an array of customer amenities that ranged from musical floor reminders, more cashier lanes and valet parking to car repairs for out-of-town travelers and battery charges on cold-weather days.
Security in the world’s largest parking garage was enhanced with the installation of high-intensity lighting, panic alarms and elevator call boxes and an order of constant vehicle patrols, a first-ever canine unit and armed off-duty Chicago Police officers to secure cashier booths.
In 1997, Standard was rewarded with a five-year, $58.5 million contract to take over Midway parking.
Four years later, then-Mayor Richard M. Daley bundled ground transportation and parking services into one giant contract and put it out to bid at both airports. Standard Parking came out on top again.
Standard Parking has managed parking at the Millennium Park garage, Navy Pier, McCormick Place and the nearby Hyatt Regency Hotel. The company is also authorized to boot cars parked at O’Hare and Midway registered to motorists with three or more unpaid parking tickets.
The 20-year gravy train of city parking contracts has been worth at least $306.9 million to Standard Parking, records show.
Standard Parking has made $190,718 in campaign contributions to local politicians in recent years. The company has also been an insurance client of Cook County Commissioner and Finance Committee Chairman John Daley, the former mayor’s brother.
Mike Wolf, executive vice-president of Standard Parking, refused to say what service improvements, if any, the company expects to implement at O’Hare and Midway over the next five years.
He would say only, “We’re delighted to continue to operate those facilities. Our objective, as always, is to give the customers a great parking experience in a way that reflects positively on the city of Chicago.”
A consulting company hired by Emanuel to consolidate and overhaul city contracts has claimed $5 million in savings for Chicago taxpayers by rebidding the O’Hare parking contract under terms more favorable to the city.
Changes made by Accenture included lower profit margins, reduced internal management and fewer employees at all levels of the parking operation—from security and maintenance to payment booths.
“They use horses for mounted security. Why not use pick-up trucks that don’t cost as much. It’s just a less expensive way to do something that needs to be done,” said a city purchasing official, who asked to remain anonymous.
Earlier this year, the Emanuel administration issued a request for proposals for a new “parking access and revenue control technology” system that could pave the way for motorists using O’Hare’s 25,000 parking spaces to use their cell phones to pay and locate empty spaces and credit cards to pay on foot before they exit.
Respondents were further required to “accurately maintain a space count inventory for each lot and level of the main garage” and offer a “mobile device application that assists customers with finding an available space” on their cell phone or Blackberry.
Since taking office 15 months ago, Emanuel has sought to rebid a host of lucrative airport concession contracts and spread the wealth beyond a clout-heavy few.
But, he has now continued Standard Parking’s stranglehold at O’Hare and Midway and turned the international terminal over to the same joint-venture that’s already running Midway.
O’Hare has 25,000 spaces under “revenue control,” including 9,266 in the main garage. There are three surface lots adjacent to the terminal buildings and three long-term surface lots.
Together, they provided 3.4 million “paid exits” in 2010. The 23 entry and 35 exit lanes handle 20,000 transactions each day.