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Meter company sends city $13.5 million bill for disabled parking

Abuse disabled-parking placards like one hanging car above has prompted new state law thtakes effect next year.  |

Abuse of disabled-parking placards like the one hanging in the car above has prompted a new state law that takes effect next year. | Sun-Times files

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Updated: January 31, 2012 10:00PM

People with disabilities aren’t the only ones victimized by able-bodied drivers who use disabled-parking placards to park for free at metered spots in Chicago.

The city’s taxpayers are now being asked to pay for the problem, a tab that could run in the tens of millions of dollars over the course of the city’s 75-year meter-privatization deal, the Chicago Sun-Times has learned.

Chicago Parking Meters LLC sent the city a $13.5 million bill to cover losses from people who used disability placards or license plates to park for free in metered spots between Feb. 28, 2010, and Feb. 28, 2011, records show. The parking-meter company didn’t gauge how many of those drivers were legitimately disabled — though its surveys have city officials convinced that fraud played a major role in the bill being that high.

Using a formula outlined in the 521-page meter deal championed by former Mayor Richard M. Daley, Chicago Parking Meters calculated that drivers who displayed disabled-parking placards and plates got $17.9 million worth of free parking for the yearlong period.

The formula calls for Chicago Parking Meters to absorb some of that cost, based on a percentage of its annual revenues. But, for 2010-2011, the formula capped the level of free disability parking that the company had to provide at $4.4 million — with the city’s taxpayers left to pick up the $13.5 million difference, according to documents obtained by the Sun-Times.

Mayor Rahm Emanuel, who succeeded Daley on May 16, is disputing the bill and has yet to pay anything to Chicago Parking Meters.

Still, a mayoral spokeswoman concedes that the company’s audit “illustrates that the city has long been losing parking revenue as a result of” disabled-parking cheating and said, “It is time to reform the process of issuing placards and enforcing the law.”

A Sun-Times investigation last month found widespread disability-parking abuses in Chicago. The number of parking tickets and court cases involving placard abuse is on the rise, with able-bodied people using relatives’ placards, fake placards and even stolen placards to park for free.

“Their crime hurts every Chicago taxpayer,” Emanuel spokeswoman Kathleen Strand said.

There’s now one disabled-parking placard in circulation for every 13 passenger vehicles throughout Cook County.

Strand said mayoral aides haven’t figured out who devised the disabled-parking reimbursement formula — or whether it’s even based on handicapped-parking counts taken before Daley’s administration signed the deal with Chicago Parking Meters in December 2008.

Chicago Parking Meters randomly selected eight days to count cars in various parts of the city on a quarterly basis, records show. In some areas, more people parked for free by displaying a placard or plate than drivers who paid.

Daley, his former corporation counsel and two former press aides now work at Katten Muchin Rosenman LLP, the law firm that handled the negotiations that led to the city’s trading its right to collect all meter revenues until 2084 in exchange for an upfront payment of $1.15 billion to City Hall. Katten got $662,760 in fees on the deal, the Sun-Times has reported. The firm did not respond to requests for comment.

“We didn’t make this deal with CPM, but we are contractually obligated to follow it,” said Strand.

Still, she said, “Being contractually bound to the deal doesn’t mean we just cut the checks when they ask for them.”

Emanuel’s administration objected to the additional $13.5 million being sought by Chicago Parking Meters, which provided 15 boxes of documents to support its calculations, records show.

If the city paid that amount in full, it would boost the company’s meter collections by about 19 percent — from $72.3 million to nearly $86 million for 2010. A more exact percentage can’t be determined because the company reports its finances for the calendar year, not the Feb. 28-to-Feb. 28 year used to calculate the “exempt persons annual excess loss” under which it’s seeking the additional payment from the city.

The company didn’t survey disability-parking use in 2009-2010, when a public outcry emerged over equipment problems and its steep schedule of parking-rate increases.

Strand said Emanuel’s administration is making progress on lowering the $13.5 million bill.

A review of Chicago Parking Meters’ “surveys and methodology of exempt parking led to an estimate significantly less than $13.5 million,” she said. “The city and CPM are still in the process of sharing information and negotiating the payment amount, and both sides are cooperating on the matter.”

Avis LaVelle, a former Daley press secretary who serves as a spokeswoman for Chicago Parking Meters, declined to comment.

State law long has allowed disabled people to park free all day in metered spots — a benefit that dates to when public transportation wasn’t handicapped-accessible and meters had to be fed with coins and fed again when the time ran out.

Escalating parking-meter fees that took effect when Chicago Parking Meters took over the system in early 2009 are providing a greater incentive for people to cheat, experts say.

Hourly metered rates in the Loop will hit $5.75 an hour next year and $6.50 in 2013.

The City Council’s pedestrian and traffic safety committee signed off Monday on an ordinance proposed by Emanuel to tighten penalties for drivers caught illegally using disability-parking placards and plates. If approved by the full council on Wednesday, able-bodied drivers who use fraudulent placards — or use a disabled person’s placard without that person present — would face having their cars impounded and thousands of dollars in fees if caught in the act by the police.

Emanuel aides also said they’ll be part of a top-to-bottom review of disabled-parking rules that Illinois Secretary of State Jesse White has announced he’ll launch next month.

Besides those initiatives, state Rep. Karen May (D-Highland Park) has begun drafting legislation to end free parking statewide for all but certain disabled people. Currently, people can get placards for free for a wide range of disabilities by having their doctor sign a two-page form. May wants free parking only for those who are truly unable to physically feed meter kiosks or who meet certain income guidelines.

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