THE MASSACHUSETTS DEPARTMENT OF CONSERVATION AND RECREATION put the management of a state-owned Boston parking lot out to bid for the first time in more than 20 years and saw its revenue increase by nearly nine-fold.
The successful bidder, LAZ Parking, will pay $5.2 million to operate the state-owned parking lot in the middle of Storrow Drive over the next five years. LAZ will pay $988,000 next year and more than $1 million in each of the next four years.
The cumulative rent is 8.7 times more than the $120,000 annual fee the current parking lot operator, the Massachusetts Eye and Ear Infirmary, is paying. The infirmary came in second to LAZ in the competitive bidding process, submitting an offer of $4.2 million to continue operating the parking lot for the next five years.
The state’s original rental arrangement with Mass. Eye and Ear was one of several highlighted in a CommonWealth report in January on sweetheart deals handed out by the Department of Conservation and Recreation.
The Legislature authorized DCR to negotiate a 20-year lease with Mass. Eye and Ear in 1989. The initial size of the infirmary’s rental payment is unclear, but by the end of the license period in 2009 the infirmary was paying $10,000 a month, or $120,000 a year. DCR extended the lease each year under the same terms until CommonWealth began asking questions about it.
Following the initial CommonWealth report, DCR Commissioner Edward Lambert called in state Auditor Suzanne Bump to review all of the agency’s leases. Bump has yet to release her report.
“This RFP and subsequent award is consistent with DCR’s ongoing top to bottom review of our leases and permits to ensure maximum value for taxpayers,” Lambert said in a press release. “The current occupant’s use of the property had been extended past its legislated time and was significantly undervalued. Whenever there’s a chance for us to provide a better value for the Commonwealth and taxpayers, DCR will make the effort to do so.”
Mass. Eye and Ear, which says it desperately needs more parking for its patients and staff, is working hard to build legislative and community support for draft legislation whose passage would allow the infirmary to lease the property for 99 years.
As part of its proposal, the infirmary would build a four-story, 1,000-car garage underneath the Storrow Drive surface lot it now uses and construct a park atop it. The proposal also calls for a section of Storrow Drive to be relocated and Mass. Eye and Ear to expand its existing facilities out over the Charles River Extension to the edge of the new park. The project would cost an estimated $170 million; Mass. Eye and Ear is seeking state funds to help with the relocation of Storrow Drive.
“We are very concerned with what the impact will be on our short-term patient parking and long term on our proposed project, which we think answers the community desire for green space while also allowing us to invest in underground parking needed to support our operation,” said Jennifer Street, a spokeswoman for Mass. Eye and Ear. “We remain hopeful that legislation to allow DCR to enter into negotiation with us on a long-term lease will still be considered during the upcoming [legislative] session.”
It is unclear what would happen if Mass Eye and Ear succeeds in getting its legislation passed. “I suppose that legislation can be written to abrogate contracts,” Lambert told CommonWealth last September.
LAZ, which is based in Hartford, said it planned to increase the availability of overnight and monthly parking programs at the 327-space Storrow Drive lot.
DCR Spokesperson SJ Port says that LAZ, which has an office in Boston, was particularly enthusiastic about increasing access for local residents and Esplanade visitors.