The Morality of a Bribe — Can you say “Portland” or now “Chicago”

Just as the bribee in Portland begins his prison sentence for taking money to send a lucrative contract to a certain parking equipment vendor, it comes out that a similar activity may have happened in Chicago, perhaps involving the same briber. Read about it here.

I was talking about this with a friend who said that he could see no moral problem with ‘offering’ a bribe, but his moral compass would not allow him to take one. The obvious inconsistency here got me to thinking.

In some cultures a “kickback” or “backhand” or ‘fee’ paid to the buyer by the seller is part of doing business.  It is so prevalent that it is built into many transactions. Many Asian and Middle Eastern Cultures find this perfectly acceptable, and in many cases necessary to do business.

Of course the problem is that is negatively affects the free enterprise system. Prices are affected, quality may be stressed, and of course, playing fields aren’t in any way level. People buy products based on what compensation they receive personally, not what the product will do for their organization or what fits best for their operation.

Bribery may ‘oil’ the process and make it run smoother, but does it also mean that there isn’t as much rebar in that bridge, or the inspection of the electrical system is not complete, or that the equipment warranty runs out too soon? Will the service be what you expect? Will the paint curl two years sooner?  Remember, the money for that bribe has to come from somewhere.

When people take bribes they think that the money comes from the manufacturer. Nope! It comes from them. If the manufacturer can afford $90K for a bribe, doesn’t that mean that the equipment cost $90K more than it needed to? When a purchasing agent takes a bribe, they are stealing money from the organization for whom they work, NOT from the manufacturer.

All the money in the process comes from only one place, the consumer, not the supplier.

In the end, a bribe is theft. It is money stolen from your company or organization, be it university, city, airport, or development. The briber is a conduit. Taking money from an organization with one hand and giving it back to someone within that organization with the other.

There is another type of bribe — its called paying for access. One of our largest parking organizations holds a meeting once a year where all its managers come in to be exposed to products the industry has to sell. To be allowed to attend this meeting, the organization charges the vendors big bucks.  Vendors are then allowed to make presentations, meet the regional managers, and be put on lists the managers use when selecting products or services.  Is this a bribe?

You are paying for access.  Everybody does it, so you sign up.  You raise your prices a bit, maybe just for that organization, and then you go to the meeting, pay the fee, and give your pitch. When you sell them a product, it costs a bit more than it might have. The money comes from the same place.

Now about my friend and his moral compass. Remember he wasn’t opposed to giving a bribe but was opposed to taking one. Giving was OK, but taking was morally repugnant to him. This man is a very independent cuss. He wouldn’t take a bribe because he would feel that in doing so he would be giving up his ability to make certain decisions.  He would be forced to act a certain way.  He would not put himself in that position. He would lose control.

My friend’s decision has little to do with right or wrong, but with control. My guess is that at least in this issue, his moral compass is spinning.

How can we affect any change, anywhere, if we don’t reflect that change in what we do and how we act? Both the bribee and the briber are equally immoral, equally thieves, equally responsible. If we want to fix the problem, we must first clean up our own act, on both sides of the process.

JVH

 

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Trending – Autonomous Vehicles and Loss of Municipal Revenue

In Parknew’s Trending column, the lead article deals with autonomous vehicles, ie driverless cars. The author sounds the alarm that the natural extension of this phenomena is that a tremendous amount of money is going to be taken from local government coffers. Parking fees and citations will no longer bring in tens of millions. Driving citations (red lights, speeding, and DUI) will be nonexistent. We in the parking industry understand these numbers. We deal with them every day.

The inference is that many of the services provided by cities will go away because this lucrative funding pot is gone. Balderdash.

That irrepressible maw known as government won’t be stopped so easily. Fees and the like will replace parking revenue. Driverless car — Super — there will be a fee for allowing it to use the city streets. Autonomous Vehicle? How about a fee per mile. That is already being discussed in places where automobile usage is down and where high mileage vehicles are prevalent. Those two pesky facts mean that less gas is being used so there is less gas tax collected. The law of unintended consequences. We want people to drive high mileage vehicles so we bribe them to do so (with tax credits and the like) but when the revenues go down, we reach in their other pocket and pull out a fee per mile.

I don’t know that this is such a bad thing. Shouldn’t the fee for usage come from the people who actual use the service. When we subsidize parking, as we do virtually everywhere, bicyclists and bus riders pay to let you park your car a little cheaper. Why not charge enough for the right to use the roads so they can be properly built and maintained and the people using them pay for them.

In my neighborhood the city wouldn’t repair the streets because the curbs were in such bad repair. We had to form a district and assess everyone living in the area so the curbs could be repaired and then the streets replaced. People who don’t own cars or seldom use the streets are being charged the same as those who have three cars and pummel the asphalt daily.

People who benefit from the sale and use of automobiles lobby for low or hidden charges (like the gas tax) so folks will buy the newest Belchfire V12 and drive it proudly in front of their neighbor’s noses. I wonder how many people would forgo a new car or maybe that extra trip to the corner market if they had to pay so much per actual mile driven.

It becomes a viscous circle.  We do away with fees to park, but charge more for the right to use the roads. In a perfect world, properly taxes would go down and user fees go up so those who use the service pay for it.

In the good old days of firemarks, the insurance companies provided the fire departments. If your house caught fire, you called the proper fire department and they came out and put out the fire. They checked to see if you had the proper “Firemark” on your wall and if so, you got the service. If not, let her burn. You had paid for that service through your insurance policy. Now I pay a goodly sum in taxes for firemen and their modern house a block away, and hopefully. like most of my neighbors, will never use their service.

If all streets were treated like toll roads and (gasp) run by private entities, then good business would demand that the monies paid to use the streets be used to keep them in proper repair. If not, the company running, say, Venice Boulevard in Los Angeles, would lose its franchise and some other entrepreneur would take over and make things right.

Who knows, maybe autonomous vehicles could start a trend. Most likely, however, the bureaucracies we call local governments will simply find ways to take more and more and deliver less and less.

JVH

 

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A New Computer – Starting Over – Other Musings

I had a computer blow up the other day. The only way out was to do a total reset which of course lost all my data. Now I had fragmented back up here and there, but bookmarks were gone, and a lot of passwords. My stories and other data was safe — but starting over is a pain.

There are programs and apps which I take for granted (FTP, Server Log in, Firefox, etc) and use automatically daily. Each had to be downloaded (and some paid for) and then configured the way I like them. Outlook was the worst — I did have my email files on a separate drive, but getting Verizon to work was hell. I finally gave up and set up another gmail account. Verizon seems to work for phones and internet, but not email.

There were probably a hundred internet bookmarks in my old PC. They were everything from Costco to Amazon to blogs I like to read. I’m recreating them, but find that I actually visited very few of the sites. They are gone — meh. As for passwords, no problem there — just ask the site and it will tell you what the password is assuming you know your mothers maiden name or the name of your first pet. It is so easy it is scary.

Losing all that stuff from time to time is not a bad thing. A lot of clutter just goes away. Its like spring cleaning. If it was important, I could with a little effort recreate it, if not,so be it.

I have friends who remember everything. Every nuance, every word, every event, everything, just like the computer. It seems to me to be emotionally draining. Someone says something, and an issue you had with them in college pops up. Damn. There are a lot of things I just don’t want to remember.

Flew to Vegas the other day to tend to some last minute IPI booth stuff. The captain stepped back into the cabin and told us that Mary Smith, the first officer, would be in command of the plane over to Sin City. He noted that it would be bumpy over the desert but it always is this time of year. We were on final approach to McCarran Airport, about 200 feet off the ground, when the engines cranked up and we went around. Five minutes later we landed on a different runway. Mary did a great job but we were all curious as to why we got an extra bit of flying time. My guess, wind shift. Oh well, they say any landing you walk away from is a good one.

I would like to blame the sparse blogging on the computer and email hell I have been through, but that’s not the real reason. I have just been a bit lazy, and stressed a tad about Parking Technology Today. As is always the case, the next issue is just fine, and in this case, has a ton of great articles you will want to read. We cover EMV, PCI, and lots of technology. It will be on line by July 1 and in you mailbox shortly after.

If you are going to the IPI, bring your swim suit — it was 104 in Las Vegas yesterday. Marcy tells me that she is looking forward to it. It was 112 in Phoenix…but is a dry heat.

We are going to the IPI show in Shifts this year – Marcy, Astrid and I will be there for the entire show, Eric comes in on Tuesday, Joyce for the day on Wednesday. Drop by and sit a while. We have comfortable chairs, good conversation, and a bit of entertainment to distract you from the rigors of parking.

JVH

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My Kind of Technology

Of all the things that are frustrating in life, dealing with municipal government is high on the list. As an outsider, you have no understanding of the process, the timeline, or the heavy hand of bureaucracy.

According to pix11.com, A smartphone app offered in New York City makes it easy for users to address parking tickets.

Christian Fama and Ari Lemmel are the brains behind “Win it” – a new app that will fight parking tickets issued in New York on your behalf. If their legal team gets the summons dismissed, they collect half of what the city fined you. If you are found guilty, you just pay the fine and nothing else.

Most users send a photo of their ticket and Win It staff ask for additional information if needed. Then, Win It goes after the ticket with the absolute goal of getting it revoked. They deal with the red tape, are fully schooled in the process and say their success rate is 50 percent.

Win It’s leadership say they city should find the service helpful, as well. If a disputed ticket is not revoked, the app helps users transmit their payment expeditiously.

Works for me. Now I need an app like that to deal with my health insurance company.

Read the article here.

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Parking Meter Bugs Bite

Credit card capable meters in Columbus, Ohio, take credit cards but don’t allow credit card users to pay for anything less than two hours, reports The Columbus Dispatch at dispatch.com. City workers, especially, have felt the sting of this misguided default. The city is hard at work fixing the problem. So far, reports the Dispatch, the bug has been corrected to allow credit card users to pay for time in increments, except for the first user of the day, who will still be required to pay for two hours.

Initially, meters that started with 2 hours could not be reduced to a lesser amount of time, but the city fixed that part of the glitch this afternoon. The first transaction after the fix still will be stuck at 2 hours, but every one after that should allow users to reduce the time they want to purchase, said Rick Tilton, spokesman for the Department of Public Service. “I know it’s frustrating for people,” he said. “We’re sorry there was any inconvenience.”

I’m not much for computer programming myself, but I imagine 40 pages of code and 5 tiny characters that have to be found and fixed for this problem to go away. I don’t envy anyone that job. Still, you have to wonder how these glitches occur in technology that has been installed and used elsewhere.

Users who want to avoid the problem entirely can just use coins. The 2-hour bug doesn’t affect coins.

Read the article here.

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Shoup and more Shoup

I know you may be on Shoup overload after our last issue with the Shoup Dogg on the cover and articles from his students and me lauding the professor. Fair Enough.
I did attend a reception this past week at UCLA for Don Shoup and he was lauded by his students and his peers. They really seem to like him over there. The event was appropriately held on the roof of a parking structure near the campus. They charged us to park. I thought that was cheeky, but what can you say. I was told that they had to pay for the spaces they used on the roof for the event.
There were posters discussing Shoup’s theories, an excellent spread of hors oeuvres, open wine bar, and TV screens lauding his accomplishments during his four decades toiling at the university. There were quite a few non-Bruins there – Liliana Rambo and Cindy Campbell (in PIX below with moi) from the IPI were present, as were media from the LA Times and parknews.biz. I ran into Peer Ghent from the City of LA, and Mario Inga and his wife from the City of Beverly Hills. It was the place to be if you were in Parking.

 

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When we walked in, he was alone, looking at an octopus like bicycle built for eight. Strange creature. He noted that he was glad to see us (I introduced my wife, who had never met him.) He noticed my hearing aids and commented that he had gotten them a few years before. He’s the one in the tan Jacket on the Octobike facing away from camera.

octopus
“I noticed I couldn’t hear the students in the back rows. I would have to walk back there to get their comments or questions. Actually it wasn’t a bad idea, then I could see what they were really doing on those laptops.” That was typical Shoup – a great sense of humor.
He told us that he wasn’t really retiring, he just wasn’t working for someone any more. He was going to be writing another book and keeping his fingers in the parking and planning pies.
I asked him how it was that whenever there was a story on parking, he figured prominently in the copy. He said he wasn’t sure, but once when he was on Good Morning America they sent a limo to pick him up at 4 AM and take him to the studio. He was interviewed for nearly half an hour. The reporter told him that there was far too much “good stuff” to use in the one segment, and that he may show up on GMA again and again. He laughed as he said that the segment used that day was about 30 seconds.
However he is quick with a parable whether its talking about how parking minimums are set by counting the number of nuns in a convent (so many spaces per nun) or the number of gallons of water in a swimming pool (so many spaces per gallon). He notes that the relationship between who actually drives at a convent or a swimming pool is irrelevant.
Newscasters love to see a senior professor who actually looks like a senior professor expound on a topic that affects everyone. “If you have to pay for a car, insure a car, put gas and oil in it, provide maintenance, why should someone else pay for you to park it?” There is no ‘free parking’, he notes, only parking paid for by someone else, the merchant, the city, the apartment building owner, or the shopping center. The cost for the parking is plowed back into everything you buy, your rent, the cost of a movie ticket, your taxes. Talk about not being fair.
Don Shoup caused a firestorm in the industry when he published his book, “The High Cost of Free Parking.” He not only reached out to parking folks, he reached out to mayors, city managers, city planners and the like. They began to ask hard questions of their parking managers and consultants. No wonder he is off so many Christmas Card lists.
He spoke for about 15 minutes and had the crowd in stitches. Wife Robyn commented that she doesn’t know if he knows anything about parking, but she can see why I Iike the guy.

JVH

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Parking Technology Today, and Chip Payment Myths Part Deux

Yesterday to stirred up quite a bit of comment, for this blog at least, with a myth versus reality note from Visa on the upcoming integration of chip technology in credit and debit cards that are accepted by parking operations.  It was a precursor to an article I’m preparing for the upcoming July issue of Parking Technology Today.  There are a number of more they address, but I will note the following here, as this specific question came up in rta’s comments below.

Myth
U.S. merchants that choose to upgrade their terminal to support EMV chip payment acceptance must install a PIN pad.

Reality
Small-ticket unattended merchants must support the processing of transactions without a Card Verification Method (C\!M)*. Unattended merchants are not required to support PIN acceptance. However, if the chip card is presented that supports PIN, and 1- the unattended terminal has a PIN pad, the transaction must be processed with a PIN, if requested.

What it means:

Nope –Assuming you elect to do anything at all,  you don’t have to install a pin pad.  However if the chip card is used that supports a pin, and if there is a pin pad present, then the transaction must be processed with a pin, if the terminal requests it.

Want to learn about the other three myths Visa shoots down, read Parking Technology Today, coming in July.  (Note:  That was a shameless plug.)

JVH

 

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Chip Payment Acceptance Myth and reality

I am working on a major article for Parking Technology Today coming out in July.  I am in receipt of a document from Visa that I will share with you in the article. But I thought you might like a taste:

Myth: All US Merchants must be set up to accept chip payments by 1 October 2015.

Reality: US merchants are NOT required to support chip processing. However Effective 1 October 2015 the Visa global POS counterfeit fraud liability shift will be instituted in the US. With this liability shift, that party that, due to their lack of chip technology, is the cause of a contact EMV ship transaction not occurring (i.e. either the issuer or the merchant’s acquirer) will be held financially liable for any resulting card-present counterfeit fraud losses.

  • Issuers retain counterfeit fraud related liability if they do not issue chip card
  • Conversely, acquirers assume counterfeit liability if the magnetic-stripe data from a contact ship card is copied and used in a non-contact chip terminal.

What this means:

One purpose, among others, of issuing the chip card is to prevent fraudulent duplication of the data on the card (which is relatively easy with a mag stripe card.)  So if the card is cloned the responsibility for the transaction is moved  to the issuing bank if it does not issue chip cards, or to the acquirer (the company processing the transaction for the merchant and hence to the merchant)  for the fraudulent amount charged. This is for transactions where the card is present. It is not true for transactions where the card is not present (like over the internet.)  It is also not true if the card is stolen and used before the theft is reported.  The liability is ONLY placed on the merchants if the card is counterfeited and used at a terminal that is not chip enabled.

What is your liability assuming you do nothing. Its the cost of a parking space.  If its on street it may be only a few dollars, and beside, how often are counterfeit cards used for small ticket items. Off street, when dealing with long term parking, like an airport, and monthly permits, may be different. Also if you are a city or a university and have many different potential charges on the cards, the risk may be higher.

Unfortunately you have to review carefully your potential liability and decide whether to upgrade equipment now, or wait until you would normally upgrade, at the end of its natural life.

Nothing is ever easy, is it.

Stay tuned for more Myths and reality.

JVH

 

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Collection is the hardest part of enforcement

In Statesville, North Carolina, local leaders are just about to give up on collecting more than $37,000 in uncollected parking tickets. They might have done it already if their city council members showed up to meetings in numbers that would meet quorum requirements. According to Statesville.com, city leadership voted two years ago to intensify efforts to collect unpaid parking fees, but the work has proved unsuccessful. The fines, along with another $117,000 on unpaid utility bills are not appearing.

In a memo to the council, City Finance Director Lisa Salmon explained that the actual amount in question is $37,765 and it involves nearly 2,700 parking tickets issued during the time period of Jan. 1, 2004, through May 1, 2008.

The memo said that collection efforts had been exhausted.

If collection efforts have been exhausted, you have to wonder what powers the city has on hand to collect unpaid parking fines and utility bills. Can they garnish wages? Can they call for arrests? Can they refuse to renew vehicle registration or utility service? Can the boot a car parked on city streets?

It’s hard to fathom a system that imposes fines it cannot collect. Even though writing off these sums does seem like the best thing to do now, it does not create a positive perception of the city or its policies. How many of use could afford to walk away from that much money because it would be too much trouble to get it back? Statesville is just sending a message to everyone that it doesn’t enforce its own laws.

Read the article here.

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Off the Record

As I mentioned before, I spoke to someone at VISA who actually was clear and concise about what the upcoming migration to chip cards (EMV) means to the parking industry, both to the vendors and to the organizations that actually accept credit cards. He also told me that he couldn’t speak ‘on the record’.  I figured that since he didn’t mince words, told the truth, and was clear.  Almost exactly the opposite of those who CAN speak ‘on the record.’ He promised to get me the name of someone who could.

I think that this all goes back to our litigious society.  VISA is afraid of being sued, so they limit the amount of information available to the public. After it has been cleansed, edited, approved by legal, the release is basically useless.  VISA isn’t alone.  Fear is rampant in boardrooms across the fruited plain.  A slip of the tongue and millions in liability money could change hands. Quotes also have political ramifications.

Wherever I go, I get it. “Is this off the record?”  Last Friday I had some adult beverages with a group of friends from the industry. I asked a question. The first words were “is this off the record.” Sigh –

I was interviewing the parking manager for a medium size city a couple of years ago.  I asked him whether the policy of the city in setting rates and enforcement rules was based on protecting the parking resource or to generate money. He said “On the record or off the record?”

I said on the record:  He said – “Of course we set policy to protect the resource, to have as many spaces available to the public and to support our merchants. Parking is extremely important not only to individual drivers, but also to business in our community. I can’t say enough about how the mayor and the city council have been working to make our city ‘parking centric.”

I then said “off the record:”  “Are you nuts, of course we set policy to maximize revenue. We are constantly looking for money for the general fund and parking is a cash cow.”

Hmmmm   Interesting different approach, on or off the record. Which one do you think was the truth and not BS.

Unfortunately journalists need to keep the faith. If we didn’t, no one would talk to us more than once.

JVH

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