An Illinois state court judge last week agreed to allow a lawsuit to proceed challenging Chicago’s 99-year, $563 million lease of four downtown parking garages to a private consortium.
The complaint was filed in mid-February in Cook County Circuit Court by the Illinois Independent Precinct Organization and a citizen against Chicago Loop Parking LLC and the city comptroller, Amer Ahmad.
Judge Rodolfo Garcia granted the plaintiffs’ motion last week for leave to proceed with the complaint.
The defendants have 60 days to respond. Chicago Parking Meters is being represented by Winston & Strawn LLP.
The group behind the complaint is being represented by lead attorney Clint Krislov of Krislov & Associates. The firm also represented the voter organization in a challenge filed against the city’s parking meter lease.
Chicago and the Chicago Park District in late 2006 closed on the lease handing control of the garages to the consortium led by investment arms of Morgan Stanley.
Chicago Loop Parking filed a claim for $200 million in 2011 arguing that the city’s approval of a new parking facility within a designated zone triggers a provision in the lease that allows it to recoup current and future lost revenue. The city is challenging the request.
The lawsuit argues that the lease illegally usurps the city’s legislative and police powers by barring it from opening new public garages in the area. It seeks to void the lease.
The company operates the garages and collects parking revenues from the three Grant Park garages and the Millennium Park garage.
All four are located in the area between Michigan Avenue and the Lake Michigan shoreline downtown.
Chicago used $278 million from the deal to retire limited-tax bonds that financed construction of the Millennium Park garage.
Another $120 million went into an escrow with interest covering the $5 million in annual revenue the district will lose as a result of handing over control of the garages. Another $150 million is financing park improvements.
