The New York City Department of Parks and Recreation (DPR) owns over 29,000 acres of parkland that house over a thousand recreational facilities including playgrounds, athletic fields, swimming pools, tennis courts, and comfort stations. In the past decade, the DPR has made notable progress in restoring these facilities from a condition of neglect dating from the 1970s and early 1990s fiscal crises to a much improved condition that encourages use by residents and visitors.58 Much of the progress is related to the development and expansion of a form of public-private partnership that differs from the PPPs discussed in this report. These partnerships involve nonprofit organizations, and these organizations provide philanthropic resources to the DPR facilities rather than depend exclusively on payments from the public sector or on user fees. The leading example, the Central Park Conservancy, has raised hundreds of millions of dollars in donations for capital improvements in that park as well as for its ongoing maintenance. Similar entities have been established for numerous other parks, although they have typically been less successful in generating philanthropic support.
Despite its progress, the DPR still faces three challenges that PPPs might help address. First, many neighborhood parks, relatively often those in poorer neighborhoods, are still not in satisfactory condition. DPR has a relatively sophisticated system for monitoring the condition of its parks that includes visual inspections of park conditions one to three times a year. Data collected on 17 different indicators assessing custodial, structural, and horticultural maintenance are aggregated in the Mayor's Management Report. The data show that the condition of parks by almost all measures has improved since the early 1990s; however, citywide ratings have slipped slightly in recent years. The percentage of parks rated as not in an acceptable condition in fiscal year 2007 was 16 percent and the percentage of parks not rated as acceptably clean was 9 percent.59
Independent civic and community groups issue their own assessments of parks. One group, New Yorkers for Parks, conducts inspections of parks and issues a yearly report card on their condition. The most recent report card, issued in 2007, highlighted geographic disparities in park conditions and found that poor conditions tend to persist in the same parks.60 An analysis by the CBC confirmed a statistically significant correlation between overall park condition and median household income - that is, parks tend to be in poorer condition in poorer neighborhoods.61
Additional evidence of a continuing backlog in repairs appears in the Asset Management Information System (AIMS), a report that quantifies the repair work needed to bring assets to a state of good repair.62 Funding requirements for the Department of Parks and Recreation (DPR) have grown steadily over the past ten years, from $190 million in fiscal year 1998 to $433 million in fiscal year 2008. A significant portion of these needs are bulkhead repairs on waterfront properties that may not correspond to the parks in poor condition, but neglect of those local parks facilities is also a part of the picture. 63
A second challenge relates to planned enhancements of existing parkland. Specifically, the PLANYC initiative calls for significant improvements to eight large parks, totaling about 500 acres, which have not been fully developed: Fort Washington Park and Highbridge Park in Manhattan; Soundview Park in the Bronx; Highland Park and Rockaway Beach in Queens; McCarren Park and Dreier-Offerman Park in Brooklyn; and Ocean Breeze in Staten Island. These parks- ranging in size from 36 to 212 acres- face different challenges, including improving access to the parks for the surrounding community, developing around a natural preserve, performing major repairs to bring facilities to a state of good repair, creating and upgrading recreational and athletic facilities, and improving amenities on the boardwalk.64 The City's current ten-year capital plan allocates $386.4 million for these projects.65
A third challenge for the DPR is making the most of the revenue opportunities in the parks. Parks are not intended to be self-financing and New York's facilities have very limited user fees, but there are profitable concessions in the parks. About $50 million annually is generated by concessions that include restaurants, push carts, and parking lots; however, there is potential for significantly greater revenues from these and similar sources. The DPR has only limited incentives to optimize these revenues, because they flow to the City's general fund rather than being dedicated to the DPR. The CBC has recommended modifying this policy to allow incremental revenues to be shared between the DPR and the general fund,66 but a PPP arrangement might be a preferred option by allowing the private partner to keep these revenues (as is the case for some of the existing partnerships with nonprofit organizations) and take that potential into account in setting the availability payment (or shadow toll, if parks use were to be measured and made the basis of payment).
Given these challenges, two types of PPPs might be appropriate for the DPR. First, a group of smaller parks in need of significant repairs could be grouped for an arrangement with a single private partner. Availability or shadow payments would be made by the DPR, with the necessary payments made lower than otherwise necessary to reflect the private partner's ability to generate and retain concession revenue. Ongoing monitoring would include comparisons with the use and conditions in parks maintained by the DPR.
Second, one or more of the larger underutilized parks scheduled for improvement could be developed as a PPP. The private partner would be responsible for design, building and maintaining the new facilities. As noted above, the public sector payment could be lowered by allowing the private partner to retain concession revenues. This arrangement would allow for innovative designs and create incentives to encourage park use, a major purpose of the City's planned investments in these areas.
In both these cases, the DPR will need to adapt its performance monitoring system to meet the needs of a PPP. Using its indicators as a basis for financial penalties and incentives likely will require modifying and refining the system. This is a challenge that should be thoughtfully addressed in preparing for a PPP initiative.
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58 The progress and remaining challenges are described in Citizens Budget Commission's Report: Making the Most of Our Parks, June 2007, available online at http://www.cbcny.org/parks%20white%20paper%20final.pdf.
59 New York City Mayor's Office of Operations. Mayor's Preliminary Management Report, Fiscal Year 2008.
60 New Yorkers for Parks. The Report Card on Parks 2007. Available online at http://www.ny4p.org/index.php?option=com_content&task=view&id=57&Itemid=83.
61 Relationship statistically significant at the .05 level. For details of CBC analysis, see Making the Most of Our Parks, June 2007, pages 40-42.
62 An agency's assets are reviewed on a rolling basis every four years. Only assets with a replacement value above $10 million and a useful life of over ten years are covered. Some special systems and aesthetic components, such as landscaping, are also excluded from review.
63 Sum of capital and operating needs. See Asset Information Management System for fiscal years 1998 and 2008.
64 PLANYC. "A Greener, Greater New York." City of New York. 22 April 2006. Available online at http://www.nyc.gov/html/planyc2030/html/downloads/download.shtml.
65 City of New York. Ten-Year Capital Strategy, Fiscal Years 2008-2017. April 2007, p. 125.
66 Citizens Budget Commission. Making the Most of Our Parks, June 2007, pages 54-60.