City Government and Local Government and City-County Council and Government & Economic Development and Government and Government services and Privatization

Local parking vendor eyes contract with ACS

November 17, 2010

A local company that fears losing a lucrative parking-enforcement contract with Indianapolis hopes to retain the business by making a deal with the private firm that received approval to lease city parking meters.

Founded in 1994, T2 Systems Inc. makes software to manage fee collections and enforcement for parking violations for universities and governments. The city of Indianapolis has been a customer since 1998 and just renewed a three-year contract this past summer.

But T2 Systems CEO and co-founder Mike Simmons said he was worried his company would lose the agreement if the city leased its parking meters to Dallas-based Affiliated Computer Services.

After months of contentious debate, City-County Council members voted 15-14 Monday evening to turn over meter operations to ACS. Despite the change in management, Simmons said he’s more confident T2 Systems will keep the business than he was during the days leading up to the vote.

T2 Systems is negotiating a new deal with ACS to continue providing city services and could have an agreement signed within the next few weeks, Simmons said. The length of the new contract is part of the discussions.

“We were optimistic, but we hadn’t received any direct feedback on what role we might play,” he said, “and we were forced to assume the worst.”

Most important, a “six-figure” contract is on the line, said Simmons, who declined to be more specific.

“The city of Indianapolis is certainly one of our top five customers in the country,” he said. “I would classify the relationship and revenue as very meaningful to us.”

ACS, meanwhile, is remaining tight-lipped about its potential relationship with T2 Systems.

Company spokesman Chris Gilligan said in an e-mail that ACS does not discuss the status of confidential business contracts while they’re being negotiated.

“However, when signing any contract, ACS will look to bring the best value to the people of Indianapolis to provide the best parking experience,” he said.

Gilligan cited ACS’s partnerships to manage the parking meters with Indianapolis-based Denison Parking and Evens Time Inc.

Deputy Mayor Michael Huber said T2 Systems has done a "great job" for the city.

"ACS has told the mayor that they're committed to maximizing opportunities for local companies," he said. "Therefore, we're not surprised that ACS and T2 would be in negotiations."

Under a new deal, T2 Systems would continue to provide the same enforcement services to the city. The only difference would be that ACS would be T2’s customer instead of the city's, Simmons added.

Overall, T2 Systems has about 360 customers and 115 employees.

As part of its deal with the city, ACS also has agreed to add 200 jobs in Indianapolis in the next two years.

The city worked to revise the terms of its proposed deal with ACS after public opposition mounted. The changes give Indianapolis greater flexibility in removing parking meters and the option of terminating the agreement every 10 years.

Supporters say the deal brings a long overdue upgrade to the system even as it generates revenue for infrastructure improvements.

The deal calls for ACS to give the city $20 million upfront and an estimated $363 million to $620 million in meter revenue over the life of the 50-year deal.

Opponents nevertheless have complained the deal is short-sighted and riddled with hidden costs.
 

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