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This post follows on the earlier discussion of the The High Cost of Free Parking. I realized that I left a couple of important points out of the last post. First, Shoup applies the Hippocratic Oath of “first, do no harm,” to parking requirements. What a great way to think about city planning. If this standard was applied to all policies, we’d be living in libertarian utopia already. Secondly, he gives great treatment to the issue of why politicians sometimes choose regulations over taxation. Regulation imposes costs on everyone, but because these costs are hard to see, their costs are not easily traced to government. It is a less transparent way of manipulating behavior. Chapter 10 – Reduce Demand Rather Than Increase Supply This chapter explores some of the policy alternatives available to cities that could reduce the number of parking spaces needed to satisfy demand. Shoup supports programs that allow employers to provide their employees with unlimited transit passes. In cities where transit operates below capacity, transit agencies may be willing to sell this type of pass to employers at a low cost, knowing that many pass employees won’t use their passes regularly. As of 2002, Dallas, Denver, Salt Lake, and San Jose had adopted this type of program. In two studies, providing these eco passes reduced employees’ demand for parking by 19%, offering employers an opportunity for significant cost savings if they can provide 19% fewer parking spaces as a result. Shoup points out that in some cases this policy can be a win for everyone involved because employees receive an additional benefit, employers can save money, traffic is reduced for the cities’ other commuters, and transit agencies earn some additional revenue at near zero marginal cost, assuming they are operating below capacity. Unfortunately, Shoup finds that in some California cities that […]
This post follows on the earlier discussion of the first four chapters of The High Cost of Free Parking. Chapter 5- A Great Planning Disaster Shoup sets up parking requirements as a great planning disaster. If an individual developer chose to dedicate more of his land to parking than his customers demanded, he would lose money on the margin. If he is a major property owner and somehow made this mistake repeatedly at many properties, we might consider it a disaster. But a planning disaster occurs when no individual loses a lot of money in this type of error, but rather we all lose some. Shoup explains that parking requirements breed demand for more parking. By subsidizing driving, these rules lead more people to become drivers and encourages sprawling development. This in turn creates an increased demand for free parking and leads to higher parking requirements, since many cities base these requirements on the peak number of people who would like to park at a building for free, leading to the parking disaster we have today. Shoup explains that oftentimes parking requirements are so onerous that they dictate development both in use and in architecture. For example, Los Angeles’ “dingbat” apartments which are apartments built on stilts over driveways were created to fulfill requirements for covered parking. This chapter includes the empirical evidence that I find most persuasive so far, a study of changes in development after Oakland implemented a parking requirement in 1961. For new developments in the two years after the regulation went into effect, residential construction costs increased 18% per unit, housing density decreased by 30%, housing investment decreased by 18%, and land values fell by 33% compared to the four years before the requirement. This is strong evidence that in Oakland, at least, parking requirements, rather than demand […]
Here’s the first installation of Market Urbanism Book Club, covering the first four chapters of Donald Shoup’s The High Cost of Free Parking. If you’ve read the book previously or are reading along, please share your thoughts and questions in the comments. Chapter 1: Shoup outlines the unusual view that we take toward parking. Rather than assuming that demand for parking, like any other good, is a function of its price, urban planners typically assume that parking is a zero-price good and require building owners to provide enough parking to meet demand given a zero price. Imagine that this was the way we treated other goods… This Friday afternoon I’m thinking of a municipality that requires bars to provide their customers with as much beer as they’d like at a zero monetary cost. Shoup points out that of course we pay for the cost of all this parking, only drivers do not pay this price in their role as drivers. We pay for it as a tax on housing, retail goods, and in the form of lower wages as workers. Those who pay the highest tax are of course non-drivers. Some drivers are subsidized under this system with the highest subsidy going to drivers who make frequent, short car trips. He explains that off-street parking requirements developed as the demand for zero-price curb parking outpaced supply. This is a classic case of the Tragedy of the Commons. Because no one had property rights of street parking, it was overused. Rather than charging for this scarce resource, or allowing building owners to provide their customers with parking at profit-maximizing prices, city governments turned to regulations. Chapter 2: In this chapter, Shoup really gets to the core of the problems that government employees face when they try to provide consumer goods. Some […]
I’m very excited that some of you expressed interest in doing a book club this summer. I think we should start with The High Cost of Free Parking. It’s the longer of the two books, but it looks like the relative beach read. I am thinking that what makes the most sense is for me to post some brief thoughts on sections of the book here on the blog that we can discuss in the comments. Other options for the book club would be doing a Google Group which is basically an email chain, or we could do a Google Hangout or Skype discussion live. Please let me know if you have strong preferences for one of these methods. Otherwise, I’ll plan to do a first post on the first four chapters of the book late next week.
At Wabi-sabi, Sandy Ikeda (former Market Urbanism writer) has a great analysis of San Francisco’s pricing for parking. He points out that assigning prices to spots is not equivalent to allowing a market to determine a price. For a real price to emerge capital (the parking space) cannot be state-owned. Sandy points out that the “shortage” of parking arises because no one owns street parking, so the appropriate incentives are not in place for someone to charge an equilibrium price for parking. While the San Francisco programmay be a step in the right direction, he explains that “more intervention usually doesn’t solve the problems that were themselves the result of a prior intervention.” In this case, the city is trying to set a price for something that it could instead auction off to eliminate the original intervention. On yesterday’s post, two commenters pointed out other parking reforms in Austin and in Long Beach that go a step further than charging higher prices for parking. These cities have allowed businesses to lease parking spots for outdoor restaurant seating or retail. San Francisco has also tried turning parking spots into mini parks. This has several benefits, including allowing for land to be better-utilized by permitting a form of street narrowing. However, as long as curbside parking remains city-owned, prices for either parking or land leases will be determined arbitrarily, preventing the actual highest-value use from being discovered.
1) Nate Berg at The Atlantic Cities covers new research on the world’s earliest cities. The findings would make Jane Jacobs happy as researchers have uncovered evidence that the earliest urbanization was a case of spontaneous order. Their construction wasn’t directed by kings as some historians previously thought, but rather by bottom-up decision-making. 2) Alex Block had two interesting pieces a while back on the politics of increasing urban density. He points out that the vested interests in urban development complicate the policy prescriptions that we often advocate here of loosening regulations. 3) Charlie Gardner at Old Urbanist points out that we shouldn’t get carried away with hopes for housing prices dropping in expensive cities with increased housing supply. While land use restrictions that Matt Yglesias, Ryan Avent, Ed Glaeser and others have written on force urban housing prices higher than they need to be, infill redevelopment is inherently a costly, slow process. It’s much easier for the price of housing in, say, Houston to stay closer to costs of construction because Houston has available land to build on cheaply and easily. Housing in New York is expensive in large part because of market fundamentals, but density restrictions make it more expensive than it has to be. 4) The case of the successful parking pricing in San Francisco that continues to receive opposition reminds me of this passage from Murray Rothbard’s For a New Liberty: The libertarian who wants to replace government by private enterprises in the above areas is thus treated in the same way as he would be if the government had, for various reasons, been supplying shoes as a tax-financed monopoly from time immemorial. If the government and only the government had had a monopoly of the shoe manufacturing and retailing business, how would most of the public treat the libertarian who now came along to […]
California Assembly Bill 710 was introduced to earlier this year to tackle the problem of municipalities requiring onerous amounts of parking for new development, widely recognized as one of the main impediments to transit-oriented development and infill growth. The bill would have capped city and county parking requirements in neighborhoods with good transit to one space per residential unit and one space per 1,000 sq. ft. of non-residential space, with an exemption process for areas with a true parking crunch and some other caveats….
DCist reports that DC city councilmembers Tommy Wells and Mary Cheh proposed legislation that would allow the mayor to designate apartment buildings where residents would not be allowed to purchase residential parking permits. This innovative legislation would mark a sharp turn away from typical municipal policies that enforce parking minimums for developers. According to the DCist, building owners would be able to seek this designation for their properties only when no units are currently leased. I contacted both councilmembers to find out more information on this proposed rule — such as whether developers will be incentivized to achieve this designation or if this designation would be voided when these buildings sell — but have not yet heard back. My first thought on this legislation is that it has low potential for costs or unintended consequences and certainly marks an improvement over parking minimums. However, I also can’t imagine that this legislation would have a significant impact on the number of people parking on DC streets. Because people would self-select into buildings designated as parking-free, those who choose to rent in these buildings will probably be people who don’t have cars anyway. A more effective solution would be to raise the cost of residential parking permits to the revenue-maximizing levels, varying these rates across neighborhoods in accordance with demand.
The New York Times discusses a new building in Denver that embraces many of the ideals of transit-oriented development. The Spire is a mixed-use condo building that includes retail and recreation space along with residential units. Saqib Rahim explains: If they wish, the denizens of this mini-world can step outside into the arts district, or they can walk fractions of a mile to three of Denver’s light rail lines. Spire scores a 91 on WalkScore.com, earning the label “Walker’s Paradise.” To reach paradise, though, Spire residents won’t have to give up their cars. The 33 floors of residences sit atop a “parking podium” eight floors tall. It contains bikes and cars for rent, but most of the room is for 600 parking spaces. The building has 500 condos. Denver residents clearly enjoy the option to live in a walkable, transit-friendly neighborhood, as The Spire is one of the fastest-selling condo buildings in the country. It exemplifies that walkable development can be achieved in Western cities that have been primarily built around the automobile. The building’s prime location in the city’s downtown Arts District allows it to command high enough prices to pay for an underground parking podium, but Rahim questions whether transit-oriented development should include any parking at all. While Denver has adopted many Portland-style Smart Growth features including one of the nation’s largest light rail systems, many city residents still rely on and enjoy easy use of their vehicles. Scott McFadden, a Denver area developer who focuses on TOD said in the article: “You still need it to go to work and to shop and, quite frankly, to take it to the mountains, which is why you live in Denver in the first place.” The Spire is located in an area of the city that does not have parking […]
In Triumph of the City, Ed Glaeser offers a very insightful analysis of density restriction in India, home of some of the fastest growing cities in the world. He explains that while land use regulations are detrimental to economic growth in the United States, the consequences are much greater in developing countries. In particular he examines the strict FSI (floor space index, equivalent to FAR) limits in Mumbai and the ramifications for business there. This week at India Lives in her Cities Too, Karthik Rao-Cavale offers and in-depth analysis of the impact of parking requirements in India. In New Delhi’s Khan Market, one of the most upscale shopping destinations in India, business owners are fighting against fees for parking, which the Environmental Pollution Authority has mandated. The case is currently at the High Court, and could have significant bearings for the future provision of parking in India. The Times of India reports on the specifics of the case. The New Delhi Municipal Council that owns the garage wants to begin to start charging for use of the garage, but the traders at the market propose they could begin compensating the council to maintain free revenue for their customers. The court has ruled that parking will remain free for customers for now, with the market’s businesses paying a fee to the NDMC. Currently, parking mandates play an important part in new development in India’s cities. The Urban Development minister supports requiring parking for all new buildings. This is on top of the extreme FSI limits in some Indian cities (1.33 in Mumbai for new construction). Rao-Cavale suggests that instead of providing parking at no cost, the NDMC should sell its garages: The task of providing parking primarily belongs to the private sector. The government can permit paid on-street parking where the […]