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SR - AGR-6474 - VALET PARKING SERVICE IN OLD TOWNE1. SUBJECT Valet Parking Service for Old Towne. 2. SUMMARY City staff is proposing a three month pilot program for valet parking service to help address the parking challenges in the Old Towne area. The valet service would be sponsored and managed by the City through a contract with a professional valet company. The drop off and pick -up area is recommended to be located directly in front of the Community Services building located at 230 E. Chapman Avenue. 3. RECOMMENDATION 1. Direct the City Manager to enter into a contract with AmeriPark LLC (AmeriPark) to provide a City sponsored valet parking service for a three month period with one three month extension; and 2. Authorize the use of public parking lots as illustrated in Exhibit A for the valet parking service as needed. 4. FISCAL IMPACT The monthly cost of the contract is approximately $19,440. It is anticipated that the contract cost will be offset with revenue received by patrons utilizing the service. As such, it is hoped that the program will have a neutral fiscal impact. Should the program not be revenue neutral after three months, the pilot program may be discontinued. 5. STRATEGIC PLAN 3e. Develop and strengthen collaborative partnerships to enhance and promote quality of life programs, projects, and services; and 4b. Provide facilities and services to meet customer expectations. 6. DISCUSSION and BACKGROUND Background Approximately 15 years ago, the City began an ambitious redevelopment effort for the downtown area of Old Towne with the goal to create a vibrant business climate. One of the strategies was to proactively work with the property owners and brokers to attract additional quality tenants as a means to increase the amount of patrons to the area. The results have been impressive. The downtown area of Old Towne is extremely successful with over 50 restaurants and as many retail establishments in the downtown core. Our downtown is consistently rated as one of the top downtowns in Southern California, and for good reason. Downtown has some of the best and most unique restaurants in Orange County; the beautifully restored buildings and Plaza area provide excellent ambiance; and the location is very family friendly. During peak lunch -time and evening hours, the downtown area is thriving with thousands of visitors. Unfortunately, the success of downtown has resulted in parking challenges. While the City has approximately 1,490 parking spaces in numerous public lots and on- street throughout Old Towne, many are at capacity during peak times of the day. Recent studies have concluded that there is a significant parking deficiency and as a result, our restaurants and retail establishments are missing out on customers. In early 2017, staff organized a group of merchants, property owners, and Old Towne stakeholders to initiate a conversation regarding parking. The goal of the focus group was to define the parking challenges and develop potential short and long -term solutions. The group has met several times and has established a short list of preferred options to improve the parking conditions in Old Towne. Among the preferred options include building an additional parking structure on the east side of Plaza (in addition to the Metrolink structure planned for the west side), provide additional parking options for employees of the downtown businesses, increase enforcement of parking limits, and consider paid /metered parking for the core parking lots and on- street spaces. In addition, the group is recommending that the City establish a valet parking service. Valet service is not a new concept for Old Towne. In recent years, some businesses have expressed an interest in providing valet service for their establishment, however they did not have a place to park cars nor the appropriate right -of -way to coordinate the pick -up and drop off activity. Therefore, up until now valet service has not been permitted by the City. That said, one business (Citrus City Grill) does have a valet service that is entirely contained on their property. After talking the concept through with the parking focus group as well as with the internal city organization, it has been determined that a City- sponsored and managed valet program is feasible. The members of the focus group strongly believe a valet program will be embraced by their customers, will partially alleviate some of the parking difficulties, and serve as an excellent short - term option that can be implemented quickly. 2 5/9/17 Discussion As a result of the discussions with the focus group, staff began to formulate a valet parking plan. Among the considerations to be reviewed included: valet drop off and pick up location, where to park the cars, circulation of valet operations, hours of operation, selection of a valet contractor, and cost. As this is a new concept for the City, it is recommended that a three -month pilot program be initiated to serve as a trial run to determine if the program can be successful. Provided below are many of the program details: • Drop -off and pick -up location: While the preferred location would be directly adjacent to the Plaza, it would also be the most problematic due to traffic concerns as well as the perception that the use would only benefit a nearby particular establishment. In researching, staff determined that the most ideal location would be on Chapman Avenue directly in front of the Community Services building located at 230 E. Chapman Avenue (Exhibit A). This location does not inhibit nearby businesses, is within walking distance to the Plaza, and is in a neutral area adjacent to City Hall. To utilize this location, it is recommended that the City establish a loading zone for the five parking spaces directly west of Grand Street on Chapman Avenue to accommodate the valet service as well as mitigate any potential traffic impacts. • Hours of Operations: Based on the discussions with the merchants, it has been determined that for the initial pilot program the proposed valet service would be as follows: Sunday through Saturday 11:00 a.m. to 2:30 p.m. and 5:30 p.m. to 11:00 p.m. The focus group indicated that the weekday lunch peak is the most challenging time for their customers. This is due to the concentrated "lunch rush" as well as the area office employees utilizing the public parking lots. As such, it is possible that the weekend lunch peak may not warrant the valet parking program as the office employees are not present. The group also indicated that the evening hours are extremely busy for them as the increased number of customers more than offset the departing office employees in the parking lots. • Staging of the vehicles: The City lots (Exhibit A) that are currently underutilized and available to be used to park the valeted cars are: 1) Almond Avenue, 2) Grand Street, and 3) West Civic Center (employee parking lot at the corner of Grand Street and Almond Avenue behind the Finance Building). Staff proposes using the Almond Avenue lot during the day and the Grand Street and West Civic Center lots for evening hours. As the Almond lot is directly adjacent to residential properties, the lot will not be used for evening use. Staff reached out to St. John's Lutheran Church and the Women's Club to discuss the proposed locations and was advised that both primarily use the East Civic Center parking lot while only using the Almond and West Civic Center lots on a limited basis, and likely not during the times that the valet service is being proposed. As such, the East Civic Center public lot is not being considered for the valet program at this time. It is estimated that the Almond lot can accommodate approximately 45 cars, the West Civic Center lot can park approximately 50 cars and the Grand St. lot park 45 cars. Among the advantages of these three lots are they are minimally used during peak hours (Almond at lunch and West Civic Center and Grand St. in the evening) and the traffic circulation of the valet operation is least impactful to nearby residents and businesses. 3 5/9/17 • Valet Operator: Staff requested and received proposals from four companies who are well known in the area and are experienced in providing valet service. The proposals were fairly consistent and the cost ranged between $506 and $770 per day for three attendants, nine hours per day. Based on the proposals received, Staff is recommending to use AmeriPark for the pilot program. While AmeriPark did not submit the lowest proposal, they have the best qualifications. They currently provide valet service to local businesses including The Outlets at Orange and the Brea Mall and come highly recommended by these establishments. In addition, AmeriPark has the capability to provide ticket -less valet service which provides more convenience to the customers as well as the service provider. AmeriPark utilizes a smartphone based valet parking technology which allows for text - ahead vehicle retrieval, repeat customer recognition, real -time vehicle inventory tracking, and various reporting options. The vendor will provide all necessary insurance, uniforms, signs, and supplies required for the service. At the end of each month, AmeriPark will either reimburse the City with the excess revenue or bill for the cost. • Cost: The proposed contract with AmeriPark includes an approximately daily cost of $648. At a rate of $5.00 or $6.00 per customer, the break -even point for the valet program is 130 or 108 cars per day respectively. It is important to note that during the meetings with the focus group, the $5.00 rate has been the fee discussed. However, in further discussions with AmeriPark, they believe $6.00 would be very accepted by the valet customers. Obviously, by using the $6.00 rate, the breakeven threshold is lower. It is anticipated that demand for the valet program will be strong and therefore incoming revenue will completely offset the monthly cost of $19,440, particularly if the rate is set at $6.00. Should the valet program not attract sufficient patrons to offset the costs of the program, staff will likely recommend discontinuing the program after the conclusion of the pilot program. Conclusion Based on the increasing parking demands in the downtown area, a multi- faceted parking solution is necessary. As a result, a number of options are being considered. One option preferred by the merchants, property owners, and other stakeholders in Old Towne, is a City- sponsored valet parking program. It is recommended the City establish a three to six month pilot program for a valet parking service. Because valet service for the Old Towne area is a novelty, staff is uncertain what impacts, if any, may arise. Therefore, during the pilot program, staff will carefully monitor the operations of the service and make adjustments including, but not limited to, altering the hours of operation, changing the location of the pick -up /drop off area, and adjusting the cost per car as necessary. Within the first three months, staff will determine whether the program is successful and return to City Council with sufficient time before the end of the contract with an update and a recommendation to either extend or conclude the service. 7. ATTACHMENTS • Exhibit A — Aerial Map 4 5/9/17