The injustice of bundled parking

The other day, we looked at a new apartment building proposed for downtown San Rafael with mindbogglingly expensive parking and tried to determine how the project could be improved. One big way that deserves a second look is allowing people to rent parking spots and apartments separately.

Thanks to city law, a developer is not allowed to unbundle the cost of those parking spaces from the rent it charges tenants. Tenants don’t get the choice of whether they get a parking space or not. They just do.

Unlike a single-family home, however, these garages aren’t adaptable. A tenant can’t just use their reserved 153 square feet (8’6” by 18’) for storage or as a workspace. Adaptation isn’t just impractical, but per the city code, it would be illegal. Instead, the parking space will just sit, an empty slab of concrete soaking up $700 per month in rent. That raises the income needed to rent a market-rate home by $25,200. This is fundamentally unfair, soaking money from tenants for a resource that may not be used, damaging the vitality of the city. It gets worse.

If I’m already paying for car storage, then it’s a strong incentive for me to get a car. The developer has already spent over $55,000; I might as well go the extra $5,000 and buy a car. That will incentivize me to do things like drive more, avoid transit, and otherwise help choke up the roads and air. It gets worse.

If I’m paying $700 per month for the required car storage and another $300 per month on car ownership (car payments, gas, maintenance), that’s $1,000 I won’t be able to spend around Marin, depressing my value as a resident. That’s $12,000 per year leaving the county rather than going to local business (gas and maintenance shops ship most of their income out of the local economy).

Not only does this law restrict personal freedom of choice, it drains away hundreds of thousands of dollars from the local economy each year, and that’s just on this project. If San Rafael’s empty parcels get a similar treatment, it will be millions. It encourages car ownership and traffic and wastes the money of people who might want to go car-free.

There are three, radically simple solutions.

Repeal the parking minimum requirements for all new development in San Rafael. Developers know that they need parking sometimes to sell or rent units, but the city shouldn't substitute the judgment of skilled businesspeople for the judgment of whoever wrote the parking codes long ago.

Allow developers to unbundle parking spaces from any rent or purchase. If someone wants to buy or rent a place to keep their car, they're welcome to it, but like most products it shouldn't be forced upon consumers.

Allow parking space owners or renters to use the space for other purposes, whether a storage unit or even a workshop. It's a lot of square feet, and the owner/renter is paying for it. They should have a right to do whatever they like with it.

Each of these may have some unintended consequences, which we'll discuss next week.

Mill Valley tries free parking downtown

Free parking has, over the last decade, been identified as a major cause of sprawl, tax wastage, and traffic. San Francisco’s pioneering SFPark program, which attempts to price parking according to demand, has found that a well-managed parking supply can decrease traffic, increase retail sales, and even increase the availability of spaces.

Downtown Mill Valley is running an opposite experiment of sorts with 30 of its downtown parking spaces. PG&E will be replacing a significant amount of pipe downtown for weeks, taking 8 spaces out of commission and causing major disruptions to the usually bucolic town center. To counteract that, Mill Valley has made 30 spaces – a hefty fraction of its on-street parking – free from April 14 to May 2.

The research

I’m sure you’ve had the misfortune of circling endlessly for a parking space, only to have the one you spotted snatched up by someone in front of you. Research from UCLA’s Donald Shoup has found that such circling accounts for up to 30 percent of traffic (PDF) in dense areas.

This is a problem. The more time people spend hunting for a parking space (average is around 3 minutes), the less time they’ll want to spend at local shops. And, the more painful the search for a space, the less likely people will want to come back.

The culprit is underpriced parking.

When SFPark started operating, the aim was to leave at least one space available on every block by adjusting the price of parking. SFPark measured occupancy by each block and raised or lowered prices incrementally one space was free per block.

After three years, SFPark has decreased traffic, increased turnover, and – for the most part – accomplished its aims. The number of parking tickets has dropped and even the average price to park fell. This validates Shoup’s theories in a major real-world setting.

The plan

The 30 spaces Mill Valley has made free are funded by PG&E and the local Chamber of Commerce, as the city relies on the income from parking meters for its general operations.

Though there was apparently some talk about reducing bus fare to downtown, Chamber officials told The Greater Marin that PG&E didn’t give them enough of a heads-up to coordinate with another agency, and they’d rather do half of something – give free parking – rather than do nothing at all.

Unfortunately, Mill Valley isn’t using this as an opportunity for research. Because only a few of the parking spaces will be free, those will be at a premium. Will it cause more circling in the free area? Will it decrease turnover?

While the Christmas seasons’ free parking offers a great experiment for the whole downtown, it would be incredibly useful to understand how setting the price of parking at $0 for only a few spaces would affect downtown demand. It would also show whether this sort of program is a useful incentive to shop downtown or if it’s just going to muck things up more.

Given the research on parking policy, it seems unlikely the two-week program will lead to anything like the efficiency downtown Mill Valley will need with PG&E’s construction. I suspect there will be people circling around for the free parking spaces and lower turnover than normal, though without data we’ll have no idea whether that’s true or not.

It seems rather more likely that the program’s advertising aims – to let potential customers know that yes, indeed, Mill Valley is still open for business – will be the big win. The Chamber of Commerce will gather anecdotal evidence from its member merchants about what worked and what didn’t, and we’ll have to see what can be gleaned from that when the program ends.

In the meantime, be sure to take Route 17 downtown. They could use the business, and I suspect they’ll also need the parking spaces.

Steps toward, and away, from performance parking in San Rafael

Parking is always a sticky problem: there never seems to be enough. The solution, as discovered by San Francisco and described by parking academic Donald Shoup, is demand-responsive pricing, also known as performance parking: charge more for the most in-demand spots and less for ones that are out of the way. With a vote last week, San Rafael will put in place the technology to determine where to do just that in downtown.

But with the same vote, the city moves away from a range of prices based on location – the core of performance parking – to a flat rate across downtown. It’s one step forward, one step back.

Performance parking theory and practice

Like any scarce resource, the easiest way to manage it is through pricing. The more valuable a parking space – like one at Courthouse Square – the more the city should charge for it. The less valuable a space, the less the city should charge. People would self-select: if they really want to park on the street at Courthouse Square, they may. If not, they might choose to park in the cheaper spaces or the nearby garage.

Most cities today, however, don’t use this approach to parking. They charge a flat rate for all parking spaces, so there’s no self-selection. The result? Insufferable circling for a space, going ‘round and ‘round the block to see if something opens up.

It’s like Saturday at the mall: there are plenty of spaces around the lot, but people still circle around, trying to find somewhere closer to the door, often taking longer to park than they would take to just walk from a slightly further-away spot.

In addition to being annoying to drivers, all this circling causes traffic congestion. In particularly high-traffic areas, a sizable percentage of congestion is attributable to people circling for a spot.

San Francisco took this research to heart and created SFPark, which tries to keep 20 percent of parking spaces free on each block within a number of pilot areas. The city embedded sensors to detect whether a space is occupied. Staff take that data to adjust the price of parking incrementally up or down each month. The result has been a decline in traffic congestion, parking tickets, and even the average price to park, as price reductions have been more common than price hikes.

San Rafael gets sensors and a flat rate

In San Rafael, the city’s parking program is facing a budgetary shortfall. The program runs on the parking charges, but those weren’t enough to cover the various renovations needed as well as operations. The city, in response, decided to pass a moderate reform of how it does parking in downtown.

On the technology side, the city will purchase about 1,000 new parking meters with credit-card readers and parking space sensors. The sensors will tell the meters when the space is vacated so it can reset, tell parking staff when someone has run out of time, and tell drivers where parking is available via a phone app.

The sensors could also be used by parking staff to do a running survey of how people use the city’s spaces, but, at this point, there’s no sign they will.

And, rather than implement a performance parking program, the city has raised the rate on all on-street parking spaces to $1.50 per hour, up from $1.00 on Fourth Street and $0.75 on side streets.

It was on this hike Kate Colin raised concerns, and why she was the lone dissenting vote. The former planning commissioner wondered why side street parking should double in price. Those areas aren’t in demand now, and raising their price relative to Fourth could put more pressure on Fourth Street’s spaces.

One reason for such a dramatic hike, however, was to encourage people to use the garages and parking lots, whose prices won't be changed. Lots will remain at $0.75 per hour, and garages at $1.00 per hour. While a good idea, it does make one wonder how much spare capacity the garages and parking lots have that they can absorb much of the on-street demand.

Going forward

Despite the rate hike, the technology is the real win. It’s a $750,000 investment – about $750 per meter – that will last for a very long time. It would have been difficult to get the sensors and meters under a performance parking program. The parking charge, while misguided, is on paper. If the city wants to start a performance parking program now, it would be extremely cheap, without any extra capital investment. It would simply be a matter of legislation and organization, not money.

This would be a good project for the Downtown BID and Kate Colin to spearhead, perhaps with TAM PDA funding.

A concern for those interested in performance parking is that revenue seems to be an overriding concern for the Parking Services. It has outstanding capital costs now, along with two parking structures that are apparently at the end of their lifespan. Performance parking can actually mean less revenue for the city than the traditional flat-rate charge, which runs counter to revenue needs. If some of these capital projects are found to be unnecessary, or if another revenue stream can be found, then that would take some pressure off.

For the city planning department, the sensors could mean a real-time survey of parking conditions around the city, a fabulous tool. It would let planners know how new office tenants or apartments change parking demand. It would let them know whether there was spare capacity in the parking system to shape changes to parking policy, such as eliminating parking minimums or residential use of downtown the garages. Someone has to make the data available to other city departments, however, for this to happen.

The changes to parking in San Rafael are promising, and it’s encouraging to see Councilmember Colin taking a stand for the essence of performance parking: varying the price based on location.