Cars vs. Transit

I’ve been mulling over Josh Barro’s contention that cars should not be blamed for the failures of mass transit and his conclusion that planning and zoning is to blame. His basic contention is thus:

…the real culprit keeping Americans away from mass transit and inside cars isn’t subsidies; it’s planning and zoning. Cities impose barriers to density that limit the number of housing units and offices that can be located near buses and trains, which reduces mass-transit usage. These barriers also drive up property prices in areas near mass transit, penalizing transit-oriented living and encouraging people to live farther from urban cores, in areas where they have to drive. Meanwhile, cities often require builders to include a minimum number of parking spaces in new developments, depressing the market price of parking and further rewarding drivers.

A better approach would take advantage of the fact that proximity to transit increases property values. Cities should allow dense development, collect the property taxes that are generated, and use them to finance transit. Increased development also means more transit users and more fare revenues. But locals tend to oppose greater housing density; they also often demand parking minimums, since they don’t want to face too much competition for free on-street parking. An ironic result is that the very urban liberals who like to complain about suburban sprawl can end up encouraging it.

I concur with the larger argument about minimum parking requirements and value capture but I believe the argument falls short. While, I see how decisions made in land use policy at the local level distort the market equilibrium of supply and demand when it comes to parking, it is not as simple as to just blame the planner and the zoning code. The fact is, sprawl is baked into the cake of modern urban (and suburban) development. This makes the failure (or at least, under utilization) of mass transit easier and more likely. Here’s why:

Housing

Suburban development in Colorado Springs, Colorado

Suburban development in Colorado Springs, Colorado (Photo credit: Wikipedia)

We’ve been basically building one type of housing for the past 60 years: single family homes with attached garages, driveways and subdivisions modeled on the Plan for Riverside. When we’re not building single family homes, we’re building townhouses and apartment complexes with a similar auto-centric design. The fact is, despite the population growth in cities over the past 10 years and outside of new urbanism and rebuilding in existing neighborhoods, we have not really built any new greenfield communities that resembles any pre-depression urban form.

Finance

Even if we were to start building communities in greenfield locations with high densities that could support transit, like residential development that was built-in the streetcar era, we still likely could not build these communities without adding significant amounts of parking or by limiting density. This is in large part because of the financial institutions that provide funding for these developments do not properly know how to value these assets. Banks like to finance products in which they know and know well. The suburban form of development is one that banks have been financing for 60 years.

Other Government Agencies

November the 15th Street - also known as Flowe...

This kind of development is illegal under most zoning codes throughout the U.S. However, there are a variety of other factors at play. (Photo credit: Wikipedia)

Let’s say that we can get the financing to build an urban development along new urbanism guidelines, for example. Let’s say we’ve got the zoning in place and the transit worked out. We still might not be able to build the dense, transit-oriented community we want due to the policies of other government agencies. For example, fire departments have been opposed to new urbanism developments due to the narrow streets within these developments. It turns out that the fire trucks have become too big to fit down these streets or the perception is such that it would be too much of an obstacle to navigate.

It may come as a surprise that transit agencies might also be unfriendly to transit-oriented development, particularly if the predominant mode of access to their stations is via car. The transit agency would want to make sure its commuter parking is located as close to the station as possible. This is a common tension when building transit-oriented development.

Commerce

Strip center in the 1900 block of N Clybourn Ave

Development like this, in the transit rich, dense, urban neighborhood of Lincoln Park in Chicago. Even in dense cities, retailers insist on providing enough parking to “access” their stores. (Photo credit: YoChicago via flickr)

Retailers, particularly of the big box and other large format varieties, often won’t build in town without sufficient parking. When I was in grad school, the adjunct professor for my land use planning course told us that when Chicago was first redeveloping the North/Clybourn corridor from industrial uses to retail, the city wanted far less parking than is currently there. However, the developers balked, insisting that they needed the parking so that customers could access their stores. Of course, there was already 3 bus lines and the CTA Red Line station right there.

As a transportation planner, I appreciate that Barro is trying to explain the nexus between transportation and land use. Land uses drive transportation decisions of whether to take mass transit or cars. But so do a lot of factors beyond just the zoning code and minimum parking requirements.

Dumb Deals Follow Up

Source: theexpiredmeter.com

It’s timely, isn’t it? I just wrote about the Chicago parking meter lease and how bad it is for urban policy and next thing I know, the City is getting hit with a $22 million bill to cover a year’s worth of free parking. Even worse, it’s part of a total $50 million the City owes.

So, why the bill? Isn’t Chicago Parking Meters, the company set up to administer the City’s parking meters is surely raking it in, to the tune of $108 million in gross revenues in 2011. It turns out that the City’s parking policies are in conflict with terms of the lease. When the City let’s disabled persons park for free (as is the law in Illinois), when the City closes streets for neighborhood festivals, when the City is reconstructing streets, these are all in violation of the lease terms.

This is a serious problem because it restricts the City’s ability to set parking policy, a fundamental urban planning tool that is now off-limits if it conflicts with the lease. Whereas the general public sees higher parking fees explicitly, it is now becoming clear that neighborhood festivals and construction projects now will cost a lot more money for the taxpayers of Chicago.

Smart Meters and Dumb Deals: What Chicago is missing out on.

 

Source: Jalopnik.com

Much has been said about the parking meter fiasco and how badly Chicago has been burned. I don’t have any more to add. Rather, I’d like to focus on missed opportunities in parking technology – opportunities at the meter that support urbanism and can generate real revenues for the city. Principally, this opportunity revolves around variable pricing policy.

While cars may be a part of urban life, free (or under-priced) parking does not have to be. Donald Shoup, author of the preeminent manual on the topic, The High Cost of Free Parking, states that planners tend to tackle street parking problems by increasing off-street parking requirements. “Rather than charge the right price for on-street parking, cities attempt to require the right quantity of off-street parking,” according to Shoup.

Chicago’s parking meter rates before the lease were low in many areas (they still are likely too low in some places). They were low because cruising and overcrowding of parking were the staples of urban life, particularly in many of the lakefront neighborhoods and downtown. Conversely, we know that if parking were priced too high, vacancies would be an issue. This is simple economics, the supply and demand curve (see below).

The Market Price of Curb Parking. Source: Shoup, VTPI

True market priced parking allow for free parking until an occupancy reaches 85%. This is due to the marginal costs of adding parking is zero, Yet, when demand (occupancy) increases, the marginal cost of adding additional parking increases. Because on-street parking capacity is fixed, costs must rise to meet demand. Thus parking costs should rise. This is what is called variable parking.

A smart parking meter, such as what has been installed in San Francisco, for example, can manage the availability of on-street parking by utilizing smart meters that can adjust prices dynamically, based on demand.

This technology is enabling not just better revolution of parking, but management of parking as well.

The problem with Chicago’s parking meter lease is not just that Chicago no longer controls parking, an important revenue generator in its own right, it is that the City gave up the right to control planning policy on some of the most vibrant land it owns – the streets. The City gave up the right to manage its on-street parking, to further planning goals and livability projects that create complete streets. Such projects might be pop-up cafes, bike lanes, street parades and festivals, all of which can reduce parking supply. And all of which are penalized under the terms of the parking lease.

Pop-up cafe in Manhattan. Source: ecosalon.com

The shame is that at the moment when parking meter technology  is revolutionizing the way cities manage parking, Chicago has turned over almost significant control over to a private company. The shame is that transportation planning is moving towards complete streets policies and Chicago finds itself without the flexibility needed to make its streets more livable and more complete.

 

 

 

Supply and Demand in Downtown Residential Parking

Downtown Chicago Building Roundup: North

Downtown Chicago Building Roundup: North (Photo credit: Gravitywave)

I’d like to delve a little bit further into the pernicious effect of parking minimums, particularly as it distorts the market tenets of supply and demand. Seeing an article over the weekend in Crain’s Chicago Business about the decline in parking demand in downtown Chicago residential buildings, I could not avoid beating my favorite drum about the high cost of parking and its negative externalities. Here is the problem, according to Crain’s:

Demand for parking is dropping in downtown apartment buildings. At Lakeshore East, a development of mixed use high rise apartment and condo buildings just north of Millennium Park, south of the Chicago River and east of Michigan Ave., around 40% of renters lease a parking space, down from the developers projection of 55%. This would be fine in a true free market where the developer would assume the risk of overbuilding on parking. However, the City’s zoning code, in its infinite wisdom, requires parking in new residential developments at ratios of 0.55 to 1 space per unit. Thus, the developers initial projection for parking is at the lowest end of the parking ratio in the zoning code and is still over market demand.

Of course, I agree with Matt Yglesias in that the “problem with this regulatory minimum is that it makes it harder for existing buildings to recoup the losses previously incurred through overbuilding of parking.” Because the zoning code won’t allow for pooled or shared parking between buildings, each building must have its own allocated parking. The costs of this parking, of course, get passed onto the occupants of the building indirectly, regardless of whether the occupants have a need for a car.

Because of the over supply of residential parking downtown as mandated by zoning, parking is artificially cheaper than it should be. This, of course, encourages greater auto use in the densest part of the city, the part in which public transportation of various modes operate at a very high frequency practically around the clock. It also encourages the catering of urban design towards the car and away from alternate transportation modes, despite the fact that the alternate transportation modes may make up a larger share of trips in this area.

Ideally what I would like to see in this circumstance is free market pricing for residential parking, or if the zoning will continue to manipulate the market,  parking maximums (for all types of parking). This will allow for shared parking at closer to the true cost of providing that parking. It will also allow the free market to decide what the best use of property is under right and can reduce the cost of development and occupation of residential and other space. Most importantly, removing the parking minimums and over-supply of parking will be supportive of the existing public transportation infrastructure in place downtown, as it is the dominant mode of travel within the area and its externalities are significantly better than the car.

The High Costs of Parking…

I’m sorry that I have been bashing the parking issue to a bloody pulp and I will move on to other things, but if you want to know what is wrong with urban planning today, how unresponsive we’ve become to market conditions, and how poorly we treat our towns and cities, pedestrians and transit systems, please read this post.