Unbundling parking isn’t simple, but it’s worth it

Municipal parking policies were not created with bad intentions, or without some thought. Though they have evolved into somewhat mindless orthodoxy, they do still serve the purposes of managing parking supply. Undoing this supply-sided management scheme in favor of a demand-sided management scheme is not a simple task.

Unbundling parking, which involves separating the cost to rent a parking space from the cost to rent an apartment, is one vital tool in managing parking demand. To be effective, though, it will need to address the same issues bundled parking addresses.

So how might a city cope with the concerns opponents will raise when considering unbundling parking?

Parking will overflow into the streets!

This is a real concern. Parking minimums were originally enacted to stop drivers from taking over neighborhood streets. Simply abolishing them today without concern for the consequences would be wrongheaded.

The basic concern, ensuring neighborhoods near to downtown don’t get overwhelmed, is resolved by a residential parking permit program. The city gives or sells residents the right to the street parking in their neighborhood and also grants them the ability to temporarily give permission to their guests. All others are either strictly limited in how much time they can spend in a given space or are banned from parking in that zone entirely. To target the program more narrowly, perhaps dwellers of new apartments could be barred from receiving parking permits.

It will become impossible to park downtown!

With all of downtown’s parking demand now squeezed into its own borders, the city will have to get creative to manage it.

While the first impulse is to boost parking supply, generally parking problems are a result of poorly managed demand. Studies into the view that there’s “nowhere to park” have found that sentiment to generally be illusory. Even in Tiburon, a study into their downtown’s parking problems found that there was more than enough off-street parking to handle demand; people simply weren’t looking for it.

In San Francisco, their SFPark program addressed the issue with price signals. They lowered the price of parking in their garages, which were generally underutilized, and on low-demand side streets and raised the price of parking in high-demand main streets. Even though some prices went up, overall the average cost of parking declined and street spaces opened up.

Paired with this demand-based pricing – which would have as its goal one open space on each block – should be transportation demand management policies. These policies, proven effective in communities across the country, are designed to reduce driving and therefore parking demand. Reduced ZipCar memberships, taxi or Uber discounts, transit discounts, and bike-supportive services and infrastructure are all proven to reduce demand for parking.

In short, building new supply should be the last thing a city tries. It shouldn’t be taken off the table entirely – no tool should be – but managing demand is much cheaper and effective than shelling out $50,000+ for a new parking space. Once the cost/benefit ratio of adding new parking is greater than the ratio of demand management schemes, supply should be considered, but with care: each parking space will be one or more new trips to the garage on roads that might already be clogged.

Low-income people won’t be able to afford a parking space!

Sometimes, a family does need a car. Herding a gaggle of kids onto a bus isn’t terribly feasible, and commuting to, say, Oakland by transit just doesn’t work on a daily basis. But with parking spots going for upwards of $600 a month, a low-income family might not be able to afford it.

The simplest way to approach this conundrum is to determine the ratio of how much a parking space costs to rent to how much an apartment alone costs to rent, both at market value, and to apply that same ratio to the affordable apartment rent. Okay, that sounds less simple that it did in my head, so here’s an example.

Let’s say a market rate two-bedroom apartment goes for $2,400 a month alone and the attendant parking space costs $600 a month. Together, the market rate for this place is $3,000: 4/5ths going to the apartment and 1/5th going to parking. Since the building has unbundled parking, the $600 is an optional add-on.

Now, let’s say the maximum rent a very low income family can afford for a two-bedroom is $1,200.* If we apply the same ratios as before, the family should be charged 4/5ths of their rent for the apartment itself and 1/5th for the parking. Since this building also has unbundled parking, they are charged a maximum of $960 for the apartment (4/5ths of $1,200) and $240 for the parking spot (1/5th of $1,200), meaning the most they would pay is still the most they could afford.

While $240 still sounds like a lot to charge per month, consider it in the reverse. While a low-income family may want a car, they might want the $240 per month more. Bundled parking makes that choice for them; unbundled parking allows the family to make that choice for themselves. And, even if they do choose to take the parking spot, they won’t be paying more than one-third of their income.

You just irrationally hate parking!

No, I just really hate unnecessary traffic, and I hate it when government makes choices for people. Bundled parking, an outgrowth of the latter, causes the former.

Donald Shoup, professor of urban studies at UCLA, has said that free parking is like a fertility drug for cars. It removes the price signals that tell people maybe there’s a better way to move around and creates a shortage of the road space and parking required to support car trips.

As with any goods shortage, this means that what people don’t pay in money they pay in time: time spent in congestion, time spent hunting for a space, time spent walking from wherever that space was found. As IJ columnist Dick Spotswood observed recently, population density in and of itself doesn’t cause traffic. It’s the number of cars those people own, and how often they use them, that causes traffic.

This means the people who really do need a car, like the family with the gaggle of kids, the contractor heading to a job, or the long-haul commuter trying to get to work, will get stuck behind people who really don’t need a car but have one anyway, all thanks to decisions made on their behalf.

San Rafael and other cities should look carefully at how they manage their parking supply. If they stay on the same path, they will only make more problems for themselves and residents.

*It’s actually $1,138 in San Rafael (PDF), but I’m rounding up for the sake of example.