The revised parking fee in Thimphu city’s core areas is hurting deep into users’ pockets but parking operators say losses are mounting?
Beginning April 1, the parking fee across all areas in the city was raised to Nu 20 for every 30 minutes. Before the hike, the parking fee along the Norzin Lam was Nu 15 per 30 minutes and other areas were Nu 10.
Parking users said that the fee raise could have been managed better. For instance, the fee remains the same whether one parks the vehicle for five minutes or 30 minutes.
“They could have broken down the fee structure further into 10 minutes, 20 minutes and so on and fixed the rates,” a resident said.
Another resident said that the increased fees could hurt business establishments as customers opt for areas where they don’t have to pay such high fees or businesses with free parking.
Some commuters said that the raise has also lead to some conflicts between those using the parking slots and parking fee collectors.
Those who operate the parking spaces say they are also worried about adequate returns.
KCR Private Limited has a 20-year contract to manage the 943 parking slots in Thimphu city’s core area and the two multi-level car parking (MLCP) buildings. For the 943 parking slots, KCR has to pay Nu 3.4 million quarterly to Thimphu thromde as royalty.
Before the fee hike, KCR official said it earned between Nu 80,000 and Nu 90,000 from 943 parking slots and monthly salary of fee collectors was about Nu 700,000.
In three months KCR earns about Nu 7.2 million and after deducting the royalty and salary of parking fee collectors, its net profit was about Nu 1.7 million. A source said that KCR sometimes used to earn about Nu 130,000 daily before the parking fee hike. But that is history, they said.
KCR’s general manager Jamyang Tenzin said one week into the collection of revised parking fees they earned about Nu 20,000 more.
He said that they hoped to earn 1.5 times more with the hike but the ground reality was different. “The earning from parking slot is only enough for the company to stay afloat with huge loan repayment for MLCPs.”
Jamyang Tenzin said with unutilised parking slots at MLCPs paying the principal amount was out of the question as the daily interest amounts to Nu 160,000.
There are 570 parking slots at MLCPs. MLCP II earns Nu 3,000 and MLCP I earns Nu 1,000 every day. MLCPs charge Nu 10 for 30 minutes. There are 150 cars for thromde officials, that are exempted from parking fees, that park in the MLCP II.
Jamyang Tenzin said that they hoped with this initiative people would park their cars at MLCPs.
KCR has 55 parking fee collectors and their salary ranges between Nu 5,000 and Nu 23,000.
A parking fee collector said, though the parking fee before the raise was Nu 10 they charged Nu 15 as they couldn’t meet the target. “With the fee raise I am expected to collect Nu 5,500 but I cannot collect more than Nu 3,700.” Before the fee raise, he had to at least collect Nu 3,000.
The situation is different for parking fee collectors along Norzin Lam as they can collect more than the target amount.
Chimi Dorji, a parking fee collector at Norzin lam had to collect at least Nu 2,300 from 18 parking slots. Now, he has to collect at least Nu 5,800. He said that with the fee raise he could collect about Nu 6,000 daily.
Jamyang Tenzin said though the target was set they couldn’t collect the desired amount as there was no system to monitor actual fees collected. “Automatic parking machine will be used to collect parking fees in coming days.”
He said that going by the situation parking fee collectors not meeting targets occasionally were considered. “Only for those missing the target every day, their salary was deducted.”
Another parking operator, Lhaki Enterprise that manages 555 parking slots in Motithang, JDWNRH, Memorial Choeten, and Centenary Farmers’ Market has not raised the fees.
Lhaki Enterprise has a three-year contract to manage the parking slots beginning in August 2020.
An official said they quoted the tender for Nu 36 million and expected to collect Nu 40,000 daily to earn at least Nu 43 million in three years. “With CFM’s closure and lockdowns, we cannot collect more than Nu 18,000 daily.”
The management is expecting thromde to increase parking fees in its areas but not increase the tender amount. “We have not been able to pay the royalty.”
Lhaki Enterprise has to pay a royalty of Nu 3 million to Thimphu thromde every three months.
Lhaki Enterprise submitted two requests to the thromde office to reduce the royalty amount considering the Covid-19 pandemic.
The official said they have not received a response from thromde office to date.
Meanwhile, the thromde and KCR Private Limited have not decided on revised royalty.