How do we design a performance-based parking policy?
Ensuring a city’s success based on urban assets requires physical connections, proximities, urban density and a high diversity of activities. This usually comes with a heavy dose of space dedicated to parking vehicles, which, contrary to what is generally thought, can hinder local economic growth, social cohesion, and the overall quality of life.
The more public transportation is accessible and efficient, the larger the Active Transit Area will be. The ATA is also used in planning laws to set parking caps. The parking requirements for new projects within the ATA will be capped. For development projects outside the ATA, the minimum parking requirements are lifted, and market dynamics are used to determine their number and price. This generates a self-reinforcing loop: the more the city invests in public transport, the more efficient it is. The logic is relatively simple: the more efficient public transit is, the higher the parking price; the broader the reach of efficient public transit is, the larger the paid parking zone.
A bid for equitable parking reform
Cities thrive based on their physical connections, proximity, density, and a high diversity of activity patterns. It is believed that for this to happen, buildings and streets must have a generous share of space dedicated solely to parking vehicles. In Europe alone, there are 236 million cars, which corresponds to more than one car for every two people. In the US, local parking regulations went so far with their requirements that today there are about eight parking spots for each car.
The cost of parking
Cities can often collect parking fees to augment their municipal budgets, but those are primarily concentrated in the urban core, while parking fees are waived in the rest of the city.
While some drivers may not pay for parking, parking is never free: there is the cost of negative externalities (such as the health and environmental costs of building, maintaining and utilizing a parking spot). Eventually, it is also worth considering the opportunity costs of not having a parking spot, which is the missed opportunity to improve the wellbeing of urban dwellers.
In paid parking areas, the drivers pay for the construction and maintenance costs through hourly fees. In free-parking areas, those costs are shared among taxpayers, whether they own a car or not. Whenever a parking spot is built, something else is not.
Big box stores tend to increase their parking offer beyond the minimum number required by local planning norms. They do so to boost their chances of attracting more car-dependent customers who can afford to purchase more goods compared to cyclists and pedestrians, who have limited carrying capabilities. The cost of building a parking spot is around $10,000 per car, while for underground parking, it is between $18,000 and $30,000 per car. An average-sized underground parking garage for 400 vehicles can cost between $7.5 million and $12 million. When parking is free, drivers will not bear the construction and maintenance costs of their spot. However, the high cost of free parking will be unequally distributed among all other people, drivers or not, and drive an increase in the prices of goods and services.
The map of each single parking space in Tallinn // On-street + off-street + public + private + garages + underground parking
The argument for less parking
In an attempt to redistribute the cost of parking more equitably, cities are starting to increase parking prices in the center and expand the paid parking zone. Retailers often believe that increasing parking fees and removing street parking will decrease the number of visitors and clients, eventually hurting their businesses.
For decades, world-known professor Donald Shoup has studied the relationship between parking and retail and published the results in numerous articles and publications. His work suggests that paid parking does not decrease the turnover of visitors but rather increases it while improving the outlook of businesses and the overall wellbeing of the districts in question. He observed that when parking is not free, people still visit retail and purchase the same amount of goods; however, they do it quicker. Shorter stops mean more parking spots will be available, and the increased availability allows for turnover – increasing the daily number of customers. The complete removal of street parking can further increase the foot traffic on high streets as public space without cars is more pleasant and attracts more visitors.
How do we price parking?
The hourly fees of on-street parking are often determined by how central the spot is and how much it costs to maintain. To democratize and economize the use of public space, Donald Shoup introduced the idea of performance-based parking. This treats parking as a traded good, where the relationship between offer and demand determines the price. The logic is simple to understand, but it is also easy to deploy: the higher the occupancy rates of street parking, the higher the hourly cost.
The dynamic hourly fee can be determined by measuring the demand for parking every quarter. With parking apps and real-time monitoring, the parking fee can be adjusted hourly. This would also relieve the political burden on decision-makers, who often keep parking fees low to avoid political discontent. With performance-based parking, it is the drivers themselves who determine the cost of their parking spots.
From theory to policy making
Drafting a fair and equitable parking policy begins by assessing the added value of replacing parking spots with better, greener, more active public spaces. Better in the sense of increased design and material quality, greener to improve planetary wellbeing, and active through the increase of bike lanes. It also involves understanding public parking as commons to quantify their social, economic and environmental impact. Eventually, it is about avoiding shaping a confrontational debate between drivers and cyclists that, so far, has only led to polarization and limited solutions.
Active Transit Area
To harness the real economic value of parking space and return it to the city equitably, we have proposed establishing an Active Transit Area (ATA) to define where and how much to pay for parking. The geographical boundaries of the ATA are determined by the area where public transport is the most accessible and efficient.
The logic is relatively simple: the more efficient public transit is, the higher the parking price; the broader the reach of efficient public transit is, the wider the paid parking zone.