Parking in Santa Monica can be both costly and difficult.
The same could be said of operating all of those credit card-friendly parking
meters across the City.
Council members approved at their Tuesday special meeting
two contract amendments that will cost City Hall an extra $3.6 million to
continue providing credit card processing services for single-space parking
One contract is for an additional $600,000 to
California-based IPS Group, Inc., bringing the total value of that agreement to
The second contract amendment is for an additional $3
million to Kansas-based TransFirst Health and Government Services, Inc. That
contract, which is for five years, is now worth $6.35 million.
According to City staff, due to the increased use of
parking meters with credit cards, City Hall’s operating costs of those meters
have also increased. Specifically, City Hall’s operating costs have shot up by
$1.4 million since 2011.
The amended contract will also include an additional
$150,000 to IPS Group to replenish battery meters and perform other routine
Ever since City Hall launched a trial program of credit
card parking meters, usage of such meters increased from about 30 percent in
2011 to 60 percent of all transactions today.
According to City staff, an average of 1 million
transactions per month occurs at single-space parking meters. Based upon City
Hall’s statistics, about 600,000 of those transactions involve credit cards.
With the increased usage of credit cards at parking
meters, City Hall has had to pay IPS Group an additional $450,000 per year and
another $1 million annual in credit card processing fees to TransFirst Health
and Government Services.
IPS Group is primarily in charge of maintaining the
meters. TransFirst Health and Government Services oversees each transaction and
collects a per-charge transaction fee. Under the original contract, the firm
collects about 35 percent of transactions involving credit cards.
In 2011, City Hall converted all 5,967 on-street
parking meters to credit card enabled meters operated by IPS Group. The
technology of the meters included sensors providing real-time parking
information to drivers who had a mobile application on their cell phone. The
same info was also available on the City’s website.
IPS Group was selected in January 2011 to assist City
Hall in its trial program “to test new single-space on-street parking meters
with electronic payment options.”
According to City staff, IPS Group “was the only company
that could deliver a functional single-space product.” They also installed
single-space meters with credit card capability in Los Angeles, Beverly Hills,
and West Hollywood.
A third company – Parkmobile – had its agreement with
City Hall terminated, saving Santa Monica $250,000 annually. Parkmobile was in
charge of the pay-by-phone service option. However, City staff reported only
6,000 monthly users took advantage of the pay-by-phone option, which is only
about 0.6 percent of all monthly meter users in Santa Monica.
Copyright © 2011 by Santa Monica Mirror. All rights reserved.