Traveler Response to Transportation System Changes Handbook, Third Edition: Chapter 13, Parking Pricing and Fees (2005) / Chapter Skim
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13-1 13 -- Parking Pricing and Fees OVERVIEW AND SUMMARY This chapter presents information on how travelers respond to both the introduction of parking pricing and fees, and to changes in the level, structure, or method of application of parking fees. Included are actions that can change the costs to users of parking even without fee changes, notably through elimination of employer parking subsidies, and fee structures that differentiate by mode of parking (short/long term)
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Objectives of Parking Pricing and Fees The primary objective of setting a price on parking, for parking facility owners/operators, is to cover costs and earn a reasonable return on investment. However, this objective must often be balanced against other objectives, such as the desire to attract shoppers or employees.
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13-3 On-Street Parking Fees. This strategy covers putting a price on curbside parking on urban streets, typically through use of meters.
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13-4 Traveler Response Summary Research appears to corroborate conventional wisdom that parking demand, as measured strictly by number of cars parking (parking facility entries) , is inelastic with respect to price.
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13-5 price elasticities averaging -0.15, also revealed a decline in employees driving cars to work from 72 to 53 percent, a substantial drop in auto use in comparison to other policies with a trip reduction objective. Price elasticity can be a deceptive gauge when taken at face value without applying it to a particular price change situation.
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13-6 On the other hand, logic and some evidence suggest that quality of transit service may significantly affect SOV trip reduction potential. One set of model-derived estimates shows SOV work trip reduction as varying from 10 percent where transit would be poorest (suburbs of small cities with below-average transit service)
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13-7 municipally operated garages are shown in Table 13-1. The full tax was in effect over a twoyear period.
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13-8 The range of other areawide parking price elasticity determinations conforms, in general, with the empirically derived overall San Francisco price elasticity of -0.3 for number of cars parked. A mid-1970s study of commuter (work purpose)
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13-9 Table 13-2 Parking in CBD Areas of U.S. Cities: Availability, Price, and Utilization City Off-Street Spaces per Employee Average Monthly Parking Price Percent Commute Trips by SOV Philadelphia $165 14% Baltimore 0.22 95 64 Pittsburgh 0.30 n/a n/a n/a n/a n/a 45*
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13-10 Table 13-3 Data Summary - Sensitivity of Mode Share to Parking Subsidy Policy, by Mode Share Percentage Avg. Parking Price: Financial Co Location and re ($121)
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13-11 Table 13-4 Change in Travel Behavior Resulting from Peak-Period Surcharge in Madison, Wisconsin Reported Change in Behavior Number in Sample Reporting (percent) Percent Attributing Change to Surcharge Changed Parking Facility 96 (35%)
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13-12 Table 13-5 Differential Rate Increases at Chicago Parking Garages Median Rates at Municipal Garages Median Rates at Time Period Before Increase After Increase Percent Change Comparable Private Facilities 1 hour $ 0.90 $ 1.15 28% $1.75 8 hour 2.15 4.03 87% 4.05 Monthly 30.50 58.00 90% n/a Source: Kunze, Heramb and Martin (1980) and calculations by Handbook authors.
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13-13 Table 13-7 Summary of Eugene, Oregon, Residential Parking Management and Pricing Program Effects (Percent Change) Area Program Cars Parked Duration Turnover Zone B Resid ential Permit 2-Hr.
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13-14 3 A more conventional but instructive on-street parking pricing application in Pasadena, California, newly documented as of this chapter's final publication, is evolutionary in practical application but revolutionary in its use of parking revenues. Pasadena's historic CBD suffered a 50-year decline starting in 1930.
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13-15 Table 13-8 Relation of Trip Reduction Rates to Parking Charges in 22 TDM Programs Restricted Parking Supply Program Net Trip Reduction No Yes No Yes Greater than 30% 1 5 1 5 15 t Parking Charges o 30% 2 7 0 9 Less than 15% 5 2 4 3 Note: Table gives number of programs in each cross-classification. Source: Comsis and ITE (1993)
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13-16 Table 13-10 Case Studies of Parking Pricing Effects at Seven Employment Locations Solo Driver Mode Share Cars per 100 Employees Location, Date (Type of Case Study) Employer Pays for Parking Driver Pays for Parking Difference Employer Pays for Parking Driver Pays for Parking Difference Price Elasticity of Parking Demand 1.
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13-17 Table 13-11 Additional Examples of Charging for Workplace Parking Canadian Study Los Angeles Study Mode Share Before BeforeAfter After Drive alone 35% 28% 55% 30% Carpool 11 10 13 45 Transit 42 49 29 22 Other 12 13 3 3 Total 100% 100% 100% 100% Source: Data is from Feeney (1989)
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13-18 Table 13-12 Average Parking Cash-Out Travel Impacts for Eight Southern California Case Studies Measure Before After Change Drive Alone Mode Sh are 76.8% 65.3% -11.5%-Pts.
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13-19 Table 13-13 Parking Pricing Details and Mode Choice Impacts for Eleven Subsidy Elimination and Cash-Out Programs After Case Study Location (CA unless noted) Monthly Parking Subsidya Alternative Mode Subsidyb SOV Mode Share HOV Mode Share Transit Mode Sharec Parking Subsidy /Priced Alternative Mode Subsidyb SOV Mode Share HOV Mode Share Transit Mode Sharec 1.
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13-20 Table 13-14 Predicted Effect of Parking Subsidy Elimination and Cash-Out Among Los Angeles CBD Commuters Driver Employer Pays for Parking Travel Behavior or Travel Expenditure Pays for Parking With CashOut Option Without Cash-Out Solo Driver Share 48% 55% 69% Vehicle Trips to Work (Parking Spaces Occupied) (per employee)
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13-21 Table 13-15 Modeling of Employee Parking Pricing Regional Impacts Region Minimum Price ($) Weekday VMT (percent)
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13-22 The predicted base year parking charge impacts proved to be modest; for example, estimated overall VMT reductions for the California regions ranged from -2.3 to -2.9 percent. Yet the reductions were not vastly different than for the other pricing strategies studied, excepting a $2.00 per gallon fuel tax.
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13-23 The latest U.S. federal transportation funding bill, TEA 21, enacted in 1998, raises the maximum monthly tax-free cap for transit and vanpool transportation from $65 per month (plus inflation adjustment)
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13-24 Table 13-17 Ten Employer Sites with Differential Parking Prices or Subsidies for SOV and HOV Employer/Location Subsidies Vehicle Trip Rate per capita Ambient Trip Rate per capita Site vs. Ambient Trip Rate Hartford Steam Boiler Hartford, CT, CBD $110/month SOV $75/month carpool-2 $40/month carpool-3 $10/month carpool-4+ 50% Parking Pricing transit subsidy 0.49 0.77 -36.4% GEICO Insurance Friendship Heights, MD (Washington, DC area)
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13-25 In still another example, the city of Seattle reduced parking charges for carpools at two Seattle parking facilities downtown, from $25 to $5 per month at one facility and from $25 to nothing at the other. A survey of participants in the carpool incentive program reported that while the reduced parking charges stimulated new carpool formation, 40 percent of the participants were former bus riders and 38 percent already rideshared.
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13-26 Table 13-18 Estimated Impacts of Parking Policy by Income Quintile in Sacramento and Income Quintile 1 2 3 4 5 Total Baseline SOV work trip share Sacramento 0.65 0.71 0.76 0.79 0.77 0.75 Los Angeles 0.58 0.64 0.70 0.75 0.80 0.72 $5 regional fee (percent change in SOV work trip share) Sacramento -43% -26% -15% -10% -8% -16% Los Angeles -39% -23% -14% -9% -4% -12% Core parking fee (percent change in SOV work trip share)
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13-27 isolated suburban, exurban and rural areas. Non-auto local area site accessibility, as measured by the number of services located within a five minute walk of each site, was likewise found to be significantly related to trip reduction: TDM sites with poor access to services had a vehicle trip rate that was 5.3 percent lower than ambient trip rates, the rate for sites with fair access was 8.3 percent lower and sites with good local area pedestrian access had a rate 21.5 percent lower than ambient (Comsis, 1994)
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13-28 Table 13-19 Predicted Mode Share for Alternative Levels of Transit Access, Transit Service, and "Pay-to-Park" Probability Modal Shares Attribute/Level SOV Carpool Transit (1) Percent within 1/4 mile of transit 30 0.785 0.129 0.086 40 0.781 0.130 0.089 50 0.778 0.131 0.091 60 0.775 0.132 0.093 (2)
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13-29 The estimated SOV trip reduction varies from 10 percent where transit would be poorest (suburbs of small cities with low levels of overall transit service) to 36 percent where transit would be best (core areas of large cities with high levels of overall transit service)
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13-30 In the Seattle experiment, the parking rate of $25 per month at one facility was eliminated entirely for pools of 3 or more persons and discounted to $5 per month at the other. Additional incentives for carpooling independent of the discounted parking were also being offered in the area at about the same time, including opening a bus priority lane to carpools, cutting an associated bridge toll from 19¢ to 10¢, opening a priority ramp to the I-5 freeway, and conducting an areawide matching and promotional program.
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13-31 Other Incentives, Options, and Associated Programs Most parking pricing initiatives, particularly those with any TDM orientation, are implemented in conjunction with a broader array of changes including improvements in transit service and various financial or compensatory incentives. It is important to note and be aware of these overlapping and potentially confounding circumstances.
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13-32 Table 13-22 Relationship Between Parking Pricing and/or Subsidies and Vehicle Trip Rates at Employment Sites Type Employer and Site Setting Employment Parking Pricing Subsidies Vehicle Trip Rate per capita Ambient Trip Rate per capita Site versus Ambient Trip Rate Professional/Office Prudential CBD CBD 3,400 None None 0.82 0.87 -5.7% Aetna 2,450 None $21/mo. Transit 0.77 0.77 Same Hartford Steam Boiler CBD 300 $110/mo.
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13-33 Table 13-22 Relationship Between Parking Pricing and/or Subsidies and Vehicle Trip Rates at Employment Sites (continued) Type Employer and Site Setting Employment king Pricing Subsidies Vehicle Trip Rate per capita Ambient Trip Rate per capita Site versus Ambient Trip Rate Manufacturing/Industrial Allergan Office Park 1,400 None 100% Vanpool Subsidy 50% Transit Subsidy 0.75 0.87 -13.8% P.L.
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13-34 Table 13-22 Relationship Between Parking Pricing and/or Subsidies and Vehicle Trip Rates at Employment Sites (continued) Type Employer and Site Setting Employment Parking Pricing Subsidies Vehicle Trip Rate per capita Ambient Trip Rate per capita Site vs.
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13-35 Table 13-22 Relationship Between Parking Pricing and/or Subsidies and Vehicle Trip Rates at Employment Sites (continued) Type Employer and Site Setting Employment Parking Pricing Subsidies Vehicle Trip Rate per capita Ambient Trip Rate per capita Site versus Ambient Trip Rate Educational Institution Univ.
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13-36 RELATED INFORMATION AND IMPACTS Mode and Destination Shifts Proponents of parking pricing schemes may assume that reduction in parking demand will occur entirely through mode shifts rather than in part through reduced trip making or activity at a parking destination. Yet, with the exception of commuters, most travelers do have a choice of destinations for their activities.
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13-37 • Annual Direct Cost per Employee: Total annualized cost of implementing and administering program, less any offsetting revenues (especially from parking fees)
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13-38 However, in cases where employees experience a charge for parking, the net costs per trip or employee are negative, representing employer savings, both because of sizable trip reductions and because the employer can realistically divest itself of its excess parking obligations. When these savings are accounted for, the programs with "nominal" parking charges show a net annual savings of $152.49 per employee and $3.72 per daily trip reduced.
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13-39 Table 13-24 Summary of Parking Cash-Out Emissions and Fuel Consumption Impacts Measure Change (per Employee per Year) Percent Change Vehicle Trips -43 -11% Vehicle Miles Traveled (VMT)
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13-40 CASE STUDIES The Victoria Transport Policy Institute (VTPI) maintains an "Online TDM Encyclopedia" http://www.vtpi.org/tdm/.
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13-41 increased central area congestion caused by construction of the Bay Area Rapid Transit (BART) system, increased fares on the San Francisco Municipal Railway, and greatly improved transit services to suburban areas north of the Golden Gate.
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13-42 Table 13-25 Parking Price Elasticities by Year of Tax Adjustment and Type of Garage Year Basis of Estimate Commuter Garages Shopper Garages FY 1970-71 Autos Parked Gross Income -0.27 -1.50 -0.08 -1.23 FY 1971-72 Autos Parked Gross Income -0.26 -1.29 -0.25 -1.22 FY 1972-73 Autos Parked Gross Income -0.91 -2.19 -0.23 -1.45 3 Year Average Autos Parked Gross Income -0.48 -1.66 -0.19 -1.30 When the parking tax was reduced from 25 percent to 10 percent in 1972, the response of commuters reflected much more sensitivity than when the tax was initially imposed. The drop in price meant that the demand for commuter-oriented parking increased in an almost elastic (-0.91)
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13-43 Actions. The demonstration was implemented in four phases.
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13-44 US WEST Parking Pricing and Management - Bellevue, Washington Situation. Bellevue, Washington, is a suburb located about 5 miles east of Seattle, across Lake Washington.
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13-45 adapted, aided by their prior experience of commuting into Seattle with heavy use of carpooling and transit. Sources: Comsis Corporation and Harold Katz and Associates, "Evaluation of Travel Demand Management Measures to Relieve Congestion." Federal Highway Administration, Washington,DC (1990)
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13-46 Table 13-26 Parking Cost and Mode Choice at Two Companies in Downtown Los Angeles Company A Company B Cost per Leased Parking Space $100.00 $100.00 Monthly Subsidy per Vehicle: $40.00 $50.00 $40.00 $75.00 $40.00 $100.00 • • • Solo Drivers Carpools of Two Carpools of Three $40.00 $250.00b • • • • • • Solo Drivers • Carpools of Two • Carpools of Three Vanpoolsa • Vanpoolsa Monthly Subsidy per Employee: $40.00 $50.00 $20.00 $37.50 $13.33c $33.33 $4.00c $25.00 Public Transit Users none $15.00 Other TDM Program Elements No organized program Active program Commute Modes (Survey) : Drive Alone 49% 48% Carpool/Vanpool 20% 34% Transit 31% 18% Notes: a Assumed vanpool occupancy of ten employees per van.
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13-47 Charles River Associates, Inc., "Madison Peak-Period Parking Pricing Demonstration Project." Urban Mass Transit Administration, Washington, DC (1984)
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13-48 Kuppam, A., Pendyala, R., and Gollakoti, M., Analysis of the Potential Effectiveness of Parking Pricing Based Transportation Control Measures Using Stated Response Data. University of South Florida, Department of Civil and Environmental Engineering, Tampa, FL (1997)
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