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An Offer We Can't Refuse
by David Stanowski
26 March 2008


Great news!

Photo Violation Technologies has offered to replace the annoying parking meters in downtown Galveston with their user-friendly meters!

Introduction letter from PVT

The reasons to upgrade to their parking meters were outlined in Downtown Parking Meters: A Solution, but the primary advantage would be to remove the frustration that nearly everyone has with the current meters, which should bring more people downtown, and get the economy moving again.

PVT

Advantages to the user:

Every Way to Pay:
Pay with coins, credit cards, debit cards, and smart cards; eliminating the need to stock pile coins for a trip downtown. Time can even be added to a meter via cell phone.

No Fine Feature:
One option allows the user to bill their credit card just for the time used rather than estimating the time needed, and paying in 15 minute increments.

Grace Period:
If the user returns a few minutes late, they can pay for the overage without getting a ticket.

Pay Your Fine:
Tickets can be paid at the meter.

Special Notifications:
These meters can also be programmed for special events where they notify users that parking is not allowed, on certain days and times, or allow free parking for promotions.


Advantages to the City:

PVT's studies show that the City should be able to earn at least five times the revenue that they collect with the current system. This is because all the time that is used must be paid for since the meter's sensors start billing as soon as a car arrives in a space, and do not allow the next car to use any left over time. In addition, with a camera in each meter, every violator receives a ticket.

PVT will also retrain existing City employees, so layoffs are unnecessary.

For the first week or two after installation, PVT will send "greeters" to walk the streets, and introduce the features of the meters to the public.

Finally, since the PVT meters run on a Wi-Fi system, the City will get a free Wi-Fi system that can be used by anyone who is within 300 feet of a parking meter!


Advantages to downtown merchants:

These parking meters should remove all of the current frustrations that customers have with street parking near downtown stores, restaurants, clubs, and bars.

It will also allow downtown businesses to re-open their negotiations with the City to earmark parking meter revenue for an on-going marketing campaign just for downtown Galveston.

Downtown business owners can use the free Wi-Fi network, along with their customers.


The City has not yet responded to my request to provide the total number of metered spaces in downtown Galveston, but a Meter Maid said that, at the present time, there are 900 parking meters, and at least 200-300 pay-and-display spaces. This means the cost to do a total retrofit would be over $3 million.

The City can certainly afford to do this, but it does present a rather sizable political hurdle, because there is bound to be opposition to spending that amount of money on these meters. This is why PVT made us "an offer we can't refuse". They have agreed to install their parking meters with no up-front cost to the City!!

Under this proposal, PVT will be reimbursed for their investment from parking revenue, and will enter into a revenue-sharing agreement with the City.

The arrangement would begin with PVT establishing Galveston's current average parking meter revenue per month by using receipts from the last 36 months. After the new meters are installed, the City would always receive its average monthly revenue before any other monies are distributed. This means that the City is guaranteed to maintain its existing revenue, no matter what happens, but it has the opportunity to increase it's collections dramatically!

The parking meter revenue that is generated over and above the baseline amount will be allocated first to paying off the meters, second to PVT's operating expenses, and the remainder will be split 50-50 between PVT and the City. PVT expects the meters to be fully paid off in 3-6 months, so after that, the City would receive a 50-50 split (minus expenses) on all revenue that the new meters generate above the baseline.

Revenue Sharing Proposal


Due Diligence:
Galveston's current parking meters annoy and frustrate customers, so they interfere with the ability of downtown businesses to increase their revenues and profits. PVT's new technology would remove this barrier, and open up commerce in downtown Galveston. Therefore, there is no reason not to accept this offer after the proper due diligence is completed.

PVT has an award-winning technology that will solve all of the current parking meter problems in downtown Galveston, but it was founded in 2004, which means it has not been around long enough for its meters to be in widespread use.

Currently, they are installed in San Francisco, and Vancouver in very limited pilot programs,
with full-scale deployment limited to Niagara Falls, NY. There have been some start up problems in Niagara Falls, but they seem to be due to the lack of cooperation from the City, and the local power company.

Case Studies: San Francisco, Vancouver, Niagara Falls

This means that BEFORE the City of Galveston accepts this offer, its designated representatives need to investigate the reputation and financial condition of PVT, and then they should visit Niagara Falls, to observe these parking meters in action. While they are in Niagara Falls, they can also speak to officials from the City of Niagara Falls about their experiences with PVT, and their meters.

PVT's offer to fund the start up costs of this project could disappear at any time, so t
ime is of the essence! The credit markets have been in chaos for months, and they are not getting any better. This means that it is possible that PVT could lose the source of its funding, if the City of Galveston waits too long to make a decision.


To watch a video of the meters in operation, Click Here.

For a video of parking solutions in non-metered areas, Click Here.

PVT

References:

Business 2.0
New York Times - 09 September 2007
Parking Today - September 2007
Time Magazine: Best Inventions of 2007
Cisco Customer Case Study
More Media


For more information on the Galveston Economy:
 
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