CHICAGO Oct 15 Chicago will launch an operational and financial management audit of its controversial parking meter lease deal with a private company that is seeking more than $50 million in reimbursements from the city, Mayor Rahm Emanuel said on Monday.
The third-largest U.S. city received $1.157 billion in 2008 from the 75-year lease with Chicago Parking Meters LLC (CPM), an investor group that includes Morgan Stanley.
The deal, which resulted in parking meter rate hikes, was slammed in 2009 by a Chicago inspector general report that said it undervalued the system of 36,000 parking meters by $974 million.
Emanuel, who inherited the lease from former mayor Richard Daley, has balked at reimbursing the group for out-of-service meters due to street closures and other reasons.
"This administration will continue to fight any charges sent by CPM that we feel are not accurate or justified," Emanuel said in a statement. "As I have said before, the city does not cut a check simply because we receive a bill."
The audit, which will begin next month, is expected to include interviews with top CPM officials and representatives from Morgan Stanley. The city will look into CPM's compliance with hiring requirements for minorities and other groups and revenue reconciliation between transactions and collections records, according to the statement.
The mayor said similar audits will be conducted for the city's other leases for parking garages and the Skyway toll bridge.
"These comprehensive, regular audits will help ensure accountability and keep those behind the agreements honest and responsible," Emanuel said.
A spokeswoman for CPM did not immediately respond to a request for comment. Chicago tapped parking meter deal proceeds to help close budget gaps under Daley.