In a textbook case of robbing Peter to pay Paul, the City of Oakland has chosen to enforce a long dormant 18.5% parking tax for all Coliseum events. Starting with the next A’s homestand, parking will go up $2. Prepaid parking will not be affected.
East Bay Express scribe Robert Gammon points out that per the lease terms, the A’s can deduct the tax from the team’s lease payment. The payment gets split between the City and County evenly, which means that the County takes the hit. That has caused Alameda County to sue Oakland to prevent the tax collection.
In the grand scheme of things, this is really pushing pennies around. The A’s only pay $750k this year and next, and around $1 million the following two years. $2 isn’t exactly 18.5% percent, so the A’s will be “covering” the remainder. Oakland’s budget deficit had been estimated to be around $60 million for this fiscal year until massive cuts were made last week. Let’s take a look at the numbers:
- 42 games x 5,000 parking spaces x $2 = $420,000
- $750,000 lease payment – $420,000 tax deduction = $330,000 new lease payment
- Normal terms are $750,000 / 2 = $375,000 to City, $375,000 to County
- $330,000 / 2 = $165,000 to City, $165,000 to County
- City’s final take is $420,000 + $165,000 = $585,000 (additional $210,000 revenue)
- County’s final take = $165,000 (loss of $210,000 in revenue)
Depending on how long the legal battle is, accrued fees could total $100,000 or more, cutting into revenue even further. And keep in mind that this money doesn’t go directly into public services, it’s there to service the combined $22 million in debt service and operating costs on the stadium. Since the tax is a perfectly legal part of the agreement, the City is perfectly within its rights to levy it. It can’t make for a better working relationship among the three parties, however.
As far as the A’s are concerned, it’s roughly the same money going out. The tax will probably push some percentage of fans to either the BART lot or to use BART instead. Happy times, people!