In a surprise move orchestrated by Mayor-elect Michael Nutter, leaders of the Philadelphia Parking Authority said yesterday that they would give the city and schools $26.25 million this year - $2.71 million more than originally budgeted - and they pledged to step up their contributions in future years as well.

"I see it continuing to go up under the Nutter administration, and you can quote me on that in big, bold letters," said the authority's executive director, Vincent Fenerty, after a board meeting where the news was announced.

The bulk of the extra money this year will come from the Parking Authority's cash reserves and from authority income streams (such as a car-impounding program) that historically have not been shared with the city and schools.

All told, the agency is transferring $6.77 million over the next two years into the authority division that gives its profits to the city and schools. That cash will help the agency catch up on its payments to the city - which are $2.3 million below budget, as reported in yesterday's Inquirer - with enough left over for the school district to get $1.25 million this year and $1.75 million next year, assuming the authority can meet its revised budgets.

By legislative agreement, the city gets the first $25 million in parking enforcement profits, while the rest goes to the schools. But since the state seized control of the authority in 2001, the agency has typically fallen well short of that threshold and exceeded it only in 2004.

That financial track record prompted a series of articles in The Inquirer and the Philadelphia Daily News over the last two months that examined the authority's free-spending ways, including a doubling of the agency's staff, the high salaries of its top executives, big consulting contracts and more.

It was in that context that Nutter met with senior Parking Authority executives on Nov. 28. Though both parties said the meeting was cordial, Nutter made it clear in an interview yesterday that he demanded immediate action.

"I told them, 'I want you to come back to me in two days and show me how you're going to get over the $25 million threshold and then beyond. That's what I want,' " Nutter said, adding that he was asking the agency's leaders to take a salary cut, which they subsequently did.

After a few days, the authority came back proposing a $700,000 increase in its payment to the city. Nutter said he told them that wasn't enough. The final deal was worked out Friday, Nutter said.

The extra money for the city and schools came after insistent requests by Parents United for Public Education.

"The parents deserve a tremendous amount of credit," Nutter said. "They came upon this issue, focused on this issue, and drew some serious attention to it, and they are the true champions here."

Another key figure was State Rep. Dwight Evans (D., Phila.), who joined Nutter at the authority's board meeting.

Although the authority is firmly in the control of Philadelphia Republicans led by State Rep. John Perzel, Evans has long been a key legislative ally of the authority, where his brother is an employee. Evans' history of support for the authority, and his position as chairman of the House Appropriations Committee, has given him plenty of influence with authority leaders.

Yesterday, Evans threw his support behind the revised budgets, and said again that he favored plans for a comprehensive audit of the Parking Authority. But he was also keen to remind reporters and members of Parents United that the Parking Authority does not exist to fund the schools.

"The Parking Authority is not responsible for funding public education," Evans said. "It is not their mission."

Leaders of Parents United praised Evans and Nutter for stepping in, and said they were encouraged by the Parking Authority's revised budgets.

"It's an important start, and I think it's significant because making progress has been very difficult," said Helen Gym of Parents United. "I will say the Parking Authority still has huge expenditures that are of real concern, and I think it remains to be seen if things will really change over there."

If the authority is to continue exceeding the $25 million threshold, it will either have to cut expenses or increase revenue. A large chunk of the money it plans to transfer to the city and schools - $3.07 million - comes from reserves the agency kept as part of a self-insurance plan, and those reserves will be soon be gone. Fenerty said the authority's finance managers had been "extremely conservative" in determining how much cash to keep on hand for self-insuring purposes.

Contact staff writer Patrick Kerkstra at 215-854-2827 or pkerkstra@phillynews.com.