A D.C. government report issued yesterday describes the private management of parking meters in the city as a financial waste, saying the outsourcing not only failed to save money but drove up costs by nearly $9 million from 1999 to 2005.
The system is riddled with other problems as well, the report says. Among the findings: The city improperly issued almost 7,000 tickets to vehicles parked at broken meters in that seven-year span, while residents' complaints about meters jumped from 3,652 in 1997, shortly before privatization, to 89,840 in 2005.
The report, by the Office of the D.C. Auditor, cites an array of alleged inefficiencies by Affiliated Computer Services, or ACS, the company hired to install and maintain 16,500 parking meters in the city. The auditors found that the D.C. Department of Transportation, which is responsible for keeping tabs on ACS, "generally was uninformed and disengaged from the details and quality of the contractor's performance."
ACS, which is paid based on parking meter revenue, sometimes got more than it was entitled to, according to the auditor's findings, first reported yesterday by the Washington Examiner. When meters along streets are "bagged" with hoods because of construction, parades, funerals or other events, the people or companies involved pay the city a fee. ACS is not supposed to share in that money.
However, from 1999 to 2005, the report says, "ACS billed, and the District inexplicably paid ACS, $644,952 in fees for bagged meter revenue."
In a written response to the audit, the Transportation Department said the increase in residents' complaints came about because it has become easier for people to register complaints via the Web and because record-keeping has improved since 1997.
The department also used a different formula in calculating the cost of parking-meter management under privatization and disputed the assertion that the city has not saved money by outsourcing the work.
As for the complaints, the report found "no evidence that DDOT management ever investigated" the reasons for the increase.
One reason for the surge in complaints: "The auditor found that although ACS failed repeatedly to repair parking meters within the 72-hour period specified in the privatization contract, the District continued issuing tickets for overtime or expired meter violations to vehicles parked at meters that were at the time inoperable."
An examination of meter maintenance records, along with 734,578 parking tickets from 1999 to 2005, found that 6,888 tickets were issued to vehicles parked at meters that had been broken for at least three days, the report says. The fines totaled $159,975.
ACS, which signed a 7 1/2 -year contract with the city in 1998, was paid $26.4 million from 1999 to 2005. The contract was extended for a year, then renewed in October for five more years, the Transportation Department said.
A spokesman for ACS referred questions about the audit to the D.C. government. Acting transportation chief Emeka C. Moneme, who has been nominated by Mayor Adrian M. Fenty (D) to head the department, told D.C. Council members at his confirmation hearing yesterday that the agency will be rigorous in keeping tabs on meters in the city.
"The contract is only as good as the contract manager," he said. "One of the great things about our new contract is that we did make it performance-based." For example, he said, under the new deal, 97 percent of the meters must be operable.
After the terrorist attacks of Sept. 11, 2001, the report says, federal officials asked the District to remove 2,278 meters around federal buildings for security reasons. The Transportation Department did so without negotiating compensation agreements with federal agencies, probably costing the city several million dollars in revenue, the audit found.
When the auditors examined paperwork related to meters along seven sample traffic routes, ACS records showed that there were 1,906 meters on those routes. But the auditors found only 1,236, of which 197 were "completely inoperative." Hundred of others were damaged.
As for the 670 missing meters, "DDOT management had no clue . . . how many had been removed from service, the revenue implications of these removals, the reason for the removals or how long the meters had been removed."
The report states that in 1993, the most profitable parking-meter year of the decade before privatization, the city took in $13.2 million in revenue against $1.1 million in expenses, for a net gain of $12.1 million -- a return of about $11 for each dollar spent. In the best year under privatization, 2003, the return was $2.63 per dollar spent.
Based on the 1993 expense total of $1.1 million, adjusted for inflation, it would have cost the city $17.6 million to manage parking meters from 1999 to 2005, the report concludes. Instead, it paid ACS $26.4 million, meaning that privatization, which was supposed to have saved money, wound up costing the city an additional $8.8 million.