The city expected to subsidize the cost of operating the garage for two years, but business was so good that the city needed only half the money it set aside. The model worked for a decade.
Councilmember Nick Licata opposed the garage deal at the time it was made, but he said proponents were proven right for years.
"Basically, we became a developer," he said, "and developers, sometimes they make money and sometimes they don't. They ride an economic tidal wave."
The City Council placed strict limits on the garage when it bought it from Pine Street Development. By ordinance, the garage cannot make a profit or carry a big reserve. It must set aside almost all parking spots for short-term parking.
The parking at Pacific Place is well below market rate, which could be one reason revenues have suffered during the downturn: It costs just $5 an hour to park at Pacific Place, compared to an average of $10 to $12 an hour at privately owned lots within three or four blocks. Those lots are doing better financially than the Pacific Place garage, Heffter reports.
In a tangentially related story, the Tacoma News Tribune reports that a nearly $3 million, 200-stall Sound Transit park-and-ride lot in Puyallup has sat virtually unused since it opened earlier this year. More than 1,000 people use the station every day.