Planning — May 2012

Smart Parking Revisited

Lessons from the pioneers.

By Jeremy Nelson and Jason Schrieber, AICP

How much is a parking space really worth? Is the space you just grabbed downtown really worth what you paid (assuming you paid anything for it)? Would you pay even more to get that elusive "front door" parking space or to park longer than the posted time limits allow? These are some of the questions a growing number of communities are trying to answer as part of the parking revolution quietly spreading across the country.

Historically, solving "the parking problem" has meant building more off-street parking, assuming your community had the land and money to do so. With costs of $20,000 to $50,000 per space for a typical downtown parking garage, many communities often waited a long time for the stars to align on a new garage; meanwhile their parking problems (and community complaints) worsened.

These days, the emphasis is on making more efficient use of the existing parking supply. Supported by new research, notably the book, The High Cost of Free Parking by Donald Shoup, FAICP (updated and issued in paperback in 2011), and the actual results of early adopters, cities large and small have learned that smarter parking management can be a valuable tool for revitalizing downtown districts, improving the customer experience, and reducing both traffic and parking congestion.

Defying conventional wisdom that "Main Street" must have free parking to compete with shopping malls, these communities are finding that demand-responsive parking pricing can smooth out parking crunches, fix deficits, and help motorists find available parking more quickly. These new approaches not only avoid the need to build expensive parking garages, they also generate revenue for projects and programs that create a customer-friendly environment. As a result, the "parking pioneers" are finding that smart parking management is a win-win-win for city budgets, taxpayers, and local businesses.

The six communities described here take different approaches, and each is at a different stage of implementation. But one thing is certain: Communities wrestling with their own parking problems should pay close attention to the successes (and challenges) of these pioneers.

Redwood City supports revitalization

One of the first cities to implement the smart approach to parking management was Redwood City, California, located on the peninsula south of San Francisco. Redwood City had an array of time limits in place to manage parking, but the variety led to confusion, and time limits weren't opening up parking spots. Broadway, the city's most popular commercial street, had one-hour time limits and no parking meters at all. As a result, curb parking on Broadway was essentially 100 percent full, all day, every day. Meanwhile, spaces just around the corner rarely exceeded 70 percent of capacity.

In 2007, the city's downtown development coordinator, Dan Zack, AICP, switched gears dramatically by deciding to establish demand-responsive pricing. Rather than merely adopting new parking rates, the city chose to set a vacancy goal of 15 percent for every block, with Zack continually monitoring parking demand and adjusting rates — as often as four times a year — to ensure that the occupancy target is met.

Redwood City introduced three price tiers — the highest on Broadway — and installed high-tech, multispace meters that allow users to pay by coin, credit card, or cell phone. Even employee lots were priced according to demand tiers. The city also took the radical step of eliminating time limits because, as Zack noted, "If a customer is having a good time in a restaurant, and they are happy to pay the market price for their parking spot, do we want them to wrap up their evening early because their time limit wasn't long enough? Do we want them to skip dessert or that last cappuccino in order to avoid a ticket?"

Results: The new strategy worked, with average parking availability increasing on Broadway to 18 percent even as average stays lengthened by over an hour. With the new revenue stream, the city dedicated net surplus parking revenues to help fund neighborhood improvements and contribute to downtown's comeback. As new leadership has taken office and new businesses have opened downtown, however, planners have had to remind people of the parking program's purpose and benefits, especially as the economy slid into recession in 2008 and 2009. Today, the program is self-sustaining, as meter and citation revenues pay for a dedicated police presence downtown.

Oak Park spurns new garages

The historic village of Oak Park, Illinois, bordering the city of Chicago, has dense residential neighborhoods, most of which were built before widespread car use. Like many growing suburbs, the village built many off-street parking facilities. But by the late 1990s, it was apparent that the village could not keep perpetually building more parking. Its parking fund was losing money each year; by 2007 it had a deficit of $10.8 million, forcing officials to draw on general funds to bridge the gap.

That same year, the village studied about 4,000 spaces — on streets, in lots, and in four garages. The study revealed that high-demand streets in the commercial district had an average occupancy rate of 91 percent, often peaking at 100 percent. At the time of the study, the price of parking ranged from 25 cents to 50 cents an hour for on-street and off-street lots, with fees collected from 8 a.m. to 6 p.m. Time limits varied from 15 minutes to 12 hours, depending on location.

In August 2008, the village board voted to create four tiered demand zones, increase rates to range from 50 cents to $1.50, and extend pricing until 8 p.m. All time limits were removed to let pricing drive the system. The reaction was less than welcoming — so much so that the village rolled back the highest price category to $1, dropped a pricing tier, and returned the end of payment to 6 p.m.

Results: According to Oak Park's interim parking manager, Cara Pavlicek, in the three years since the pricing system stabilized, public complaints have dropped and the business community now applauds the resulting shift of long-term parkers from the most convenient street parking into lots and garages. A local business association testified before the village board saying that the increased cost of street parking is "fantastic" for local businesses, and that they have "heard no complaints" from customers now that parking is always available at the curb.

Another local business owner commented that many of his employees commute to work by bus or train in order to avoid paying the meter fees, and employees who do drive are priced off the street spaces directly in front of the businesses. Moreover, village businesses have weathered the economic downturn better than those in neighboring towns; sales tax revenues increased 12 percent from FY2009 to FY2010 when most locales suffered. Overall parking revenues also have grown 37 percent; revenues in some months grew by 70 percent or more.

Washington manages growth

Washington, D.C., is one of the fastest-growing metro areas in the nation and has the congestion headaches to prove it, despite great strides in promoting transit-oriented growth. In 2011, it topped the Texas Transportation Institute's list of the nation's most congested cities. The city's transportation department has zeroed in on demand-responsive pricing as its best weapon for accommodating growth while battling gridlock.

That agency began experimenting in 2008, when the Washington Nationals' new baseball stadium opened on the southeast waterfront, while across town, a 500,000-square-foot, big box retail center opened in the northwest neighborhood of Columbia Heights. Residents of both neighborhoods resisted outsiders parking on neighborhood streets, and merchants feared their customers would be squeezed out by increased competition for curb spaces.

Demand-responsive pricing pilots were begun in each neighborhood, coupled with enhanced resident-only restrictions and reinvestment of most net surplus meter revenues into the local community. In Columbia Heights, parking rates were raised only in the areas closest to the retail center.

Around the ballpark, standard pricing was dramatically increased during games and events. Rates also escalated for longer stays, making ballgame parking extraordinarily expensive, while keeping shorter errand and dinner stays reasonably priced. Usage was routinely monitored and parking rates reevaluated quarterly.

Results: While not perfect, Washington's new parking pricing pilots proved successful, and the transportation department began planning a citywide parking pricing program in 2010. In anticipating this rollout, Ellen Jones, the director of infrastructure and sustainability for the city's downtown business improvement district, said: "Accessibility is downtown's primary competitive advantage. However, while pedestrian and bicycle access has been steadily improving, congestion has eroded access by motorized vehicles, including surface transit. We think the price of parking could be an effective tool for addressing our congestion problem."

San Francisco reduces ticket anxiety

Smart parking management is most visible in San Francisco. In 2008, the San Francisco Metropolitan Transportation Agency was awarded a competitive Federal Urban Partnership Program grant to evaluate how parking management could help reduce auto trips and traffic congestion. Dubbed SFpark, the resulting program rolled out in 2010 and 2011 with a focus on demand-responsive pricing coupled with the latest information technologies to make it easier for drivers to find and pay for parking, reducing the hunt for an empty space.

There is a tradeoff: higher prices for the most desirable spaces, but lower prices a few blocks away. The SFMTA hopes those prices will encourage many motorists to shift to other modes, travel at off-peak times, or simply park in areas with lower demand and walk a few blocks.

According to SFpark program manager Jay Primus, SFpark's primary goal is to "use a transparent, rules-based, and data-driven approach to manage parking demand so drivers can find parking quickly, rather than circling or double parking." At all of the program's 7,000 on-street spaces (one-quarter of the city's total metered on-street spaces), located in eight pilot districts, new meters allow drivers to use coins, credit cards, or debit cards to pay for parking. Pay-by-phone technology is also available at all meters citywide. SFpark meters have longer time limits to allow longer stays for shopping.

Meanwhile, wireless parking sensors at each parking space tell drivers where spaces are open, via an online map, smart phone app, text message, and parking availability signs. The sensor data also help SFMTA to adjust prices block by block in order to maximize use while ensuring that at least a space or two is always available. The program also includes 12,250 off-street spaces (three-quarters of the city's public off-street parking) to comprehensively manage on- and off-street public parking as a single, integrated supply rather than as two separate animals.

Results: While SFpark's impact on parking and traffic congestion will not be evaluated until later this year and next, the program has already shown benefits for both drivers and the city. A SFMTA review of SFpark in January 2012 showed a $6 million (35 percent) drop in revenue from parking fines along with a $5.2 million (24 percent) increase in meter revenue. The program is essentially revenue neutral even during the current economic downturn, and San Francisco motorists have a better chance of paying a fair price for parking when and where they need it.

Chicago asks what parking is worth

For many years, planners in Chicago believed that demand-responsive pricing would help improve the nation's third largest parking system, but the political will was simply not there. That was true until an enormous budget deficit in 2009 drove then-Mayor Richard M. Daley and the city council to lease parking meters to a consortium of investors led by Morgan Stanley. In return, the consortium, called Chicago Parking Meters, LLC, paid the city $1.15 billion upfront to cover the budget gap and more.

Before 2009, most Chicago parking spaces had not seen a price increase in nearly 20 years. More than two-thirds of the spaces in the city cost only 25 cents per hour, and spaces within the high-demand Loop area cost $3 an hour. At the start of the lease (which runs 75 years), CPM divided the city into three zones based on demand and between 2009 and 2011 increased the parking rates incrementally.

As of January, most areas of the city cost $1.75 per hour, the central business district $3.50 per hour, and the downtown Loop $5.75 per hour. The consortium will raise prices again in 2013 to $6.50 an hour in the Loop. (Midtown Manhattan maxes out at $3 an hour on the street.) CPM has also extended pricing hours to match demand, with the Loop now priced 24 hours a day.

The city's lease required that CPM provide some conveniences to go along with higher rates. Just a year after signing, CPM had invested more than $40 million into the system, replacing all 36,000 antiquated single-spot, coin-fed meters with 4,600 new solar-powered, multispace meters that provide several pay options and customer conveniences, such as portable time slips that can be reused in any space of equal or lesser value, extended periods of stay where longer stays are common, discounted monthly parking in lots, and 24-hour customer service.

Results: Chicago's parking management approach continues to evolve. Many residents have complained about the dramatic changes as well as the forfeit of parking meter fees as a city revenue stream. Active Transportation Alliance, an alternative transportation advocacy group, collected use data in 2010 after prices had been raised to $2 an hour in the central business district. The group noted that many parking spaces were still 100 percent full and that vehicles were parked illegally in loading zones and bike lanes. With the highest meter rates in the nation — and spaces still full — CPM has proven that parking is a commodity that people will pay for.

Ventura benefits more than drivers

Ventura, California, wanted to continue the revitalization of its pedestrian-friendly downtown by encouraging mixed use development on former surface parking lots. It also installed downtown parking pay stations, as suggested in a 2007 Downtown Specific Plan.

A survey conducted by the Downtown Association revealed that more than four-fifths of downtown business owners supported the new parking management program. Still, a vocal minority gathered enough signatures to place an initiative on the November 2011 ballot. Had a judge not declared the initiative invalid, it would have outlawed paid parking downtown.

Tom Mericle, the city's transportation manager, says there were many challenges in getting the program implemented. There were technological glitches to iron out with vendors when some of the new equipment failed to perform consistently. In addition, the initial business outreach efforts performed by the Downtown Association didn't go far enough, so the city had to go door-to-door to explain the program to merchants.

Their input led to a highly successful discount parking coupon offered during the initial holiday season. "It's critical that parking management be a cooperative effort," says Mericle. "Not everyone has to agree with the concept, but all merchants should be educated about the specifics of the program and its potential benefits. Here, many merchants who were originally opposed have been swayed by the improvement of downtown; the program is working."

Results: Once on life support, the downtown parking plan is now thriving, creating better parking availability for customers and generating net monthly revenue for the city. These funds are already being used exclusively for improvements that merchants identified as a priority, including free public Wi-Fi access and additional police officers assigned to downtown. Future parking revenue is programmed for new lighting and landscaping, street furniture, wayfinding, marketing and education programs, street cleaning, and possibly a universal valet program.

Parking's future in your community

Many other communities are joining the smart parking revolution, from Nashua, New Hampshire, to New York City. The lessons learned from these parking pioneers may be illuminating; cities can:

• Support downtown revitalization with a renewed focus on increasing availability of existing parking, as in Redwood City;
• Recognize that new garages won't get customers the front-door access they want, as Oak Park has learned;
• Use parking management as a tool to accommodate "low traffic" growth in your community, as Washington, D.C., is doing;
• Move away from a reliance on time limits and tickets, and motorists will pay more for more convenience, as in San Francisco;
• Acknowledge, as Chicago has, that parking may be more valuable than you think; and
• Use net parking proceeds to fund merchant priorities, as Ventura has done.

Cities large and small, realizing that they can't afford to build their way out of parking problems, are exploring demand-management approaches that help increase the efficiency and user-friendliness of the existing parking supply. When these approaches are implemented thoughtfully, they can increase parking availability, reduce traffic congestion, and generate revenue to pay for improvements that merchants and residents want.

The next time you are circling endlessly for an empty parking space or worrying about a parking ticket at the end of an otherwise enjoyable evening, you may just decide it's time that your community joined the parking revolution.

Jeremy Nelson and Jason Schrieber are principals with Nelson\Nygaard Consulting Associates. The firm consulted on some of the highlighted projects.

Resources

Images: Top — A solar-powered, multispace parking meter in REDWOOD CITY, California, which was an early adopter of parking management techniques. Photo by Dan Zack. Bottom — The SFpark app for smartphones delivers real-time info on parking availability and cost in SAN FRANCISCO. Images courtesy of SFpak.org.

It's a classic:The High Cost of Free Parking, by Donald Shoup, FAICP.

Up close: Redwood City: www.redwoodcity.org/bit/transportation/parking/index.html

Oak Park: www.oak-park.us/public_works/Parking.html

Washington, D.C.: http://ddot.dc.gov/DC/DDOT/On+Your+Street/Traffic+Management/ Parking/Performance+Based+Parking+Pilots

SFpark: www.sfpark.org

Chicago: www.chicagometers.com

Ventura: www.cityofventura.net/parking

LA ExpressPark: www.expresspark.lacity.org