Rampant California wildfires. Devastating floods in Texas. A windflattened Florida. Island-drowning downpours in the Caribbean. Killer earthquakes in Mexico. Even by recent standards, 2017 may go down as the most deadly and costly year for natural disasters in North American history.
It Can Happen to You
Human lives matter most, of course, but here’s one eye-popping statistic: In Texas alone, it was estimated that more than 1 million vehicles were totaled by Hurricane Harvey. Managers with the city of Houston, for example, failed to relocate city vehicles from an underground municipal garage thought to be “safe” behind a floodwall. That loss alone is projected to cost $11.7 million. Total losses from Harvey will likely exceed $200 billion.
Perhaps your facilities escaped these cataclysms. But keep in mind, the tragic loss of lives and destruction of property can happen anywhere.
Consequently, parking facility owners and managers should take steps now to ensure their customers, employees and investments are protected when—not if—disaster strikes.
Know Your Risks
The risks to your operation, like the underlying asset value, are mostly local.
Many parking operations in the paths of the recent spate of hurricanes, mudslides and fires analyzed their risks and invested in combating the most likely culprits. In South Florida, for example, wind and water damage are the enemies.
“Park One operates over 150 locations in South Florida and the majority are in the coastal areas of Miami Dade and Broward counties,” says Fred Bredemeyer, president of the firm.
“As expected, there was flooding in many areas. Windblown trees, debris and sand were also major problems. We were fortunate that there were no injuries to any of our staff, though many stayed at their properties throughout the entire storm.”
Create and Rehearse an Emergency Preparedness & Response Plan
Bredemeyer attributes the firm’s good fortune to thoughtful planning. “Park One has a company- wide emergency action plan that begins at the corporate level with Citizens Parking, our corporate parent,” he says.
“The plan is then further customized for each individual facility. This disaster plan includes emergency data backup and other action items that allow us to maintain our corporate infrastructure while ensuring continuity at the location level.”
Park One may be an exception to the rule. “Most parking companies don’t have true disaster plans in place,” said Kathy Phillips, senior vice president of Alliant Insurance Services. “Disaster plans are quite complex and need to cover a lot of different pieces of the operational puzzle including people and property.
“Unfortunately, even entities that have plans in place may not be practicing to make sure employees know what to do in an emergency. Organizations should perform at least one drill annually; quarterly is better.”
Hedge Against Losses With Insurance
Alliant’s Phillips says many operators may be surprised to learn that most catastrophic-type exposures are not covered by standard insurance.
“Flood and earthquake perils are typically excluded and have to be purchased separately,” she says. “These are for first party (the operator) coverage. So-called ‘Acts of God’ (flood, earthquake, wind, hail, etc.) are not considered the negligence of the parking company that operates the facility, so vehicles in its care, custody and control would not be its responsibility.”
Phillips also points out the need to consider “loss of use” policy riders. These policies enable operators without significant cash reserves to survive the aftermath of a disaster.
“Business Interruption coverage is a first party coverage for loss of profit and continuing expenses,” she says.
“However, very few parking companies carry this important coverage. Many parking companies just went out of business after Hurricane Katrina, for example. Some didn’t restart their businesses until New Orleans was able to rebuild, recover and allowed cars to return to the city center.”
Consider the Needs of Your Employees and Stakeholders
Says Bredemeyer, “The biggest lesson we learned from Irma is that no matter what your emergency action plan is, it must be aligned with your clients’ expectations.
“We had some clients who wanted to maintain normal parking services throughout the storm in areas that were under mandatory evacuation orders. Some clients were not aware of our specific policy on evacuation zones and closing time in advance of a hurricane warning.”
Bredemeyer adds, “Obviously, the safety of our employees is our highest priority. Our employees also need time to secure their own property and provide for the safety of their families.”
Park One used bikes to move personnel, performing off-site data backups and maintaining alternative lines of communication.
For instance, since high winds can wreak havoc with cell towers, Bredemeyer explains that as a fallback, “We used the common mobile communication app ‘Whatsapp.’ We also maintained a toll-free telephone number that employees could call at any time to get instructions on what they should do.”
Safeguard Your People and Your Property
Alliant’s Phillips says, “Even when organizations do in fact have plans for a disaster, often they start preparations too late. They end up not having the manpower to take safeguards as employees have already left the facilities to take care of their own families.”
Failure can be costly. Suspended clearance bars and sidewalk sandwich board signs can become missiles in the wind, injuring people and damaging property.
Water pouring into elevator wells can destroy the motors. Moisture can damage sensitive parking access and revenue control systems (PARCS) components.
Constantine Kyriazis, CEO of Chicago-based Citytec, a DESIGNA distributor that sells, installs and maintains PARCS, offers a few tips for protecting these high-tech investments:
- Ensure that all the power is shut down at the point-of-sale terminals and the main source, to prevent any power surges.
- Place waterproof covers over all terminals.
- Remove all the major and most expensive components (e.g., ticket reader, bank note/ credit card reader, color screens, etc.).
- Lock barrier gate arms in an upright position to allow vehicles to enter and exit freely during the disaster period.
- Secure all data in a cloud-based, redundant solution to prevent loss of valuable information.
Survey Your Losses Before Recommencing Operations
Assessing the condition of your facilities following the disaster—but prior to the restart of business operations—is critical.
An experienced manager should make an initial after-action assessment to answer a simple question: How can the facility be prepared for safe occupancy?
“Brickell Avenue in Miami’s financial district was entirely under water for several hours,” Bredemeyer reports. “We had valet services there through this period and were able to prevent any cars from getting flooded.
There were many facilities that had huge amounts of debris, including sand and mud brought from the floodwaters. We worked hard to clean our facilities and re-open as quickly as possible. Fallen trees blocking roads and surface lots were the biggest challenges.”
However, if a property is under water for any time, structural deterioration can occur and may only be evident to experts.
“Water can severely damage structures,” says Alliant’s Phillips. “While not always visible, it seeps into concrete and over time weakens the concrete mix and damages the rebar holding the structure together.
It is very important to have structures checked by a licensed structural engineer as soon as possible after they have been compromised by a storm.”
Start planning now for the next big hit: It may be coming your way.