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Council presses staff on why the $2.5M annual parking transfer hasn’t grown as revenues rise
Summary
Councilors at the May 13 session asked why the longstanding $2.5 million parking transfer to the general fund has been flat despite growing parking revenues; parking staff said building a fund balance to reduce bonding needs for a future garage explains the approach and cautioned against increasing transfers while the fund is in deficit.
Portsmouth parking officials and councilors debated the city’s recurring $2.5 million annual parking transfer during the May 13 budget work session, with council members asking why the transfer has remained static while gross parking revenues have grown.
“By having a fund balance that’s adequate, we can reduce the bonding required to complete that [third] garage,” Ben Fletcher, the city’s parking director, told the council, describing the transfer as part of a plan to preserve borrowing flexibility for large capital projects. Fletcher said roughly 48% of FY27 estimated parking revenue will fund support services (downtown sweeping, trash collection, crossing guards, snow removal) and that nonresident visitors supply the large share of garage and monthly-visitor revenues.
Councilors pressed staff for a ten-year look-back on how the $2.5 million figure was set and how much of parking revenue is retained in the parking fund each year. Several councilors said the $2.5 million appeared unchanged over time even as parking receipts increased, and they requested a report showing retained earnings, fund-balance trends and the allowable uses of parking revenue.
Staff cautioned that the parking fund has run into deficits in recent years and that increasing an established transfer without sustained surpluses could create cash-flow stress. “I would caution against it at this point,” staff said, noting that the transfer was originally set to make the Foundry Garage sale and financing palatable and that the city has drawn on fund balance to cover shortfalls.
The council asked staff to provide historical accounting and fund-balance analysis before any decision to change the transfer amount; no change or action was decided at the session.
