CHICAGO – Chicago is reviewing its options after a Cook County Circuit Court judge rejected the city’s request to trim a $58 million arbitration award won by the private operators of four downtown city and park district-owned parking garages.

An arbitration panel earlier this year ruled that Chicago must compensate the private operators for lost revenue and interest stemming from approval granted to a competing parking facility by former Mayor Richard Daley’s administration.

The private operators — Chicago Loop Parking LLC  — filed a claim in 2011 seeking as much as $200 million from the city. The group argued that the city violated terms of its 99-year, $563 million 2006 lease that prohibits the city from approving new public parking facilities within a designated zone around the garages. The matter went to arbitration. Under terms of the lease, independent arbitration rulings are binding.

The city in May sought relief in the courts by filing a complaint in which it asked that the award be modified. The city argued that an agreement struck with the building that houses the competing garage limits future losses to the private operators by ending public parking there. The $58 million award had assumed future damages.

Judge Sophia H. Hall in a written order handed down Friday granted the private operators’ request to dismiss the lawsuit. She said she lacks authority to modify or vacate the arbitration decision. She also concluded that she could not even consider the impact of the city’s agreement with the operators of the competing parking garage because that pact was struck after the arbitration decision.

“We are disappointed with the court’s decision. Nearly all of the $58 million awarded to CLP by the arbitration panel was for future damages,” said Roderick Drew, spokesman for city Corporation Counsel Stephen Patton. “We are now in the process of reviewing the court’s opinion and considering all available options, including filing an appeal.”

The city disagrees with Hall’s position that the applicable statutes and case law do not allow for the modification of a judgment based on an arbitration award “under these circumstances.” The city had hoped to achieve a net savings of $30 million.

Daley and the Chicago Park District handed control of the garages to the consortium led by investment arm of Morgan Stanley in 2006. 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 account 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.

Not long after, the city approved permits for the new Aqua Building and in 2009 signed off a permit for a 1,200-spot public parking garage in the building, which is located within the no-compete zone.

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