Ald. Brendan Reilly breaks with mayor over city’s parking tax
BY FRAN SPIELMAN City Hall Reporter email@example.com April 9, 2013 2:26PM
Updated: May 11, 2013 6:33AM
Warning of a “chilling” impact on tourism, downtown Ald. Brendan Reilly (42nd) on Tuesday broke with Mayor Rahm Emanuel over the mayor’s plan to shift Chicago’s parking tax from a sliding scale to a fixed percentage.
Budget Director Alex Holt has argued that the switch — from a sliding scale that tops out at $5 for a parking tab of $12 or more to a flat tax of 20 percent on weekdays and 18 percent on weekends — would be “revenue-neutral.”
But Reilly said Tuesday it’s more like a windfall that could kill the golden goose that drives the downtown economy at a time when hotel occupancy is rising.
“Things like this have the potential to have a chilling effect on filling hotel rooms…Mayor Emanuel has done many good things to support the tourism economy. I just hate for this to be one of those unintended negative consequences,” Reilly said.
After a targeted advertising campaign tailor-made to boost “regional tourism,” the aldermen noted that Chicago is drawing heavily from Iowa, Wisconsin, Michigan and Indiana.
“These are folks who aren’t flying or taking the train. They’re driving. When they end up at their destination in downtown Chicago, being met with $50-plus overnight parking fees is a bit too much,” he said.
“One of those issues that regional visitors especially complain about are our high parking rates… I just want to make sure we’re not making it harder to attract those most sought after conventions and tourist dollars. I’d like to find a way to soften that blow.”
Marc Gordon, president and CEO of the Illinois Hotel and Lodging Association, has argued that 18 percent of the people who stay in Chicago hotels drive to the city and park overnight, paying an average overnight parking fee of $42.31 and $50 at high-end hotels.
Under the mayor’s plan, those same motorists who were paying $3 in taxes in 2011 and $5 now would pay anywhere from $8.62-to-$10 in taxes.
“It has a severe impact on our hotels and the overnight guests who stay there,” Gordon told the City Council’s Finance Committee earlier this week.
“These are the guests who come in and stay in our hotels and spend their money in our city and pay the taxes and do all the good things that have a tremendous effect on the city’s economic [health].”
The parking tax overhaul is expected to be approved Wednesday by the full City Council, effective July 1.
Holt has argued that a percentage-based tax is more equitable for economy parkers now paying too much of the freight while downtown hotel guests pay too little.
Reilly’s break with the mayor over the parking tax did not stop the downtown aldermen from praising Police Superintendent Garry McCarthy for last weekend’s surge in police visibility on Michigan Avenue aimed at sending a message to menacing young thugs who had caused trouble the weekend before.
“He proved he’s a man of his word. We saw an increased presence on the avenue and the commercial corridor downtown. It was a substantial increase in regular force levels. That was reassuring to visitors and downtown residents,” Reilly said.
The alderman was asked how long the city can afford the downtown surge at a time when the Police Department is paying more than 400 officers-a-night to work overtime in high-crime areas.
“For the immediate future, it’s a good thing to maintain that presence on the avenue, especially on the weekends. Hopefully, this will be in place as we work into the warm weather months,” Reilly said.
“At a minimum at the very beginning of the season, we’re sending a signal to folks who might want to come downtown to do wrong that this isn’t the place to do it. You’ll be met with lots of folks in uniform ready to arrest you.”