Parking Pricing

Direct Charges for Using Parking Facilities


TDM Encyclopedia

Victoria Transport Policy Institute


Updated 17 April 2015

This chapter discusses ways of charging users directly for parking facilities and services, and the impacts this has on vehicle travel. Parking pricing provides revenue and cost recovery, encourages more efficient use of parking facilities, reduces parking facility costs and land requirements, reduces vehicle traffic and encourages use of alternative modes.




Parking Pricing means that motorists pay directly for using parking facilities. Parking Pricing may be implemented as a TDM strategy (to reduce vehicle traffic), as a Parking Management strategy (to reduce parking problems), to recover parking facility costs, to generate revenue for other purposes (such as a Transportation Management Association or downtown improvement district), or for a combination of these objectives.


Below are specific Parking Pricing techniques:


·         Wherever possible, charge motorists directly for using parking facilities. If parking must be subsidized, offer comparable benefits for use of other travel modes, such as Cash Out payments.


·         Manage and price the most convenient parking spaces to favor priority users. Charge higher rates and use shorter pricing periods at more convenient parking spaces (such as on-street spaces, and parking near building entrances) to increase turnover and favor higher-priority uses. Apply performance-based parking prices, which means that prices are set so that at least 10% of parking spaces are unoccupied at any time (Shoup 2006 and 2008). Prime spaces suitable for short-term use should generally be at least twice as expensive per hour as less-convenient spaces suitable for longer-term uses. For example, in a central business district charge 25¢ for each 15-minute period with a two-hour limit, while at the fringe charge $4 per day. The ratio between short- and long-term spaces may need occasional adjustment to optimize use.


·         For the most convenient spaces use a progressive price structure to favor short-term users. For example, charge $1.00 for the first hour, $1.50 for the second hour, and $2 for each subsequent hour.


·         Improve Pricing Methods to make Parking Pricing more cost effective, convenient and fair. For example, use electronic pricing systems that accommodate various payment methods and rates, and allow motorists to pay for just the amount of time they will be parked. For short-term parking change by the minute rather than by the hour, and for long-term parking charge by the hour rather than by the day or month.


·         Minimize discounts for long-term parking passes (such as cheap monthly rates). For example, set daily rates at least 6 times the hourly rates, and monthly rates at least 20 times daily rates. Even better, eliminate unlimited-use passes altogether. Instead, sell books of daily tickets, so commuters save money every day they avoid driving. Eliminate early-bird discounts.


·         Set parking prices to equal or exceed transit fares. For example, set daily rates at least equal to two single transit fares, and monthly rates at least equal to a monthly transit pass.


·         Avoid excessive parking supply. Use Parking Management to encourage more efficient use of existing parking facilities and address any spillover problems that result from pricing.


·         Encourage businesses to price, cash out and unbundle parking by legislation, incentives or special taxes on unpriced parking. Unbundle parking from housing, so apartment and condominium residents pay only for the parking spaces they need (Location Efficient Development).


·         If parking must be subsidized, use targeted discounts and exemptions, rather than offering free parking to everybody. For example, to subsidize customer parking, allow businesses to validate parking tickets or provide free parking coupons to customers. To subsidize parking for people with low incomes or disabilities, provide discounts directly to those individuals.


·         Tax parking and encourage or require that this cost be passed on to users (Litman 2006c). Reform existing tax policies that favor free parking. For example, tax land devoted to parking at the same rate as land used for other development.


·         Price on-street parking in residential neighborhoods. Create Parking Benefit Districts, with revenues used to benefit local communities (Shoup 1995). Allow motorists to rent or lease on-street parking spaces (Solomon 1995; Shoup 2013). For example, allow residents to purchase overnight parking permits, and let residents and businesses lease the parking spaces in front of their homes or shops, which they could use themselves, reserve for their visitors and customers, or rent to other motorists.


·         Charge a tax on curbcuts comparable to potential revenue foregone had the same curb area been devoted to priced on-street parking. This would encourage property owners to minimize the number and width of curb cuts, through access management and consolidation of driveways and parking facilities, which helps improve traffic flow and create more pedestrian friendly streetscapes.


·         Use TDM Marketing and other information resources to provide information on parking prices and availability, and on alternative travel options.


·         Develop and utilize Transportation Management Associations to provide parking management, user information and brokerage services in a particular area.


·         Use parking pricing revenues to Fund Transportation Programs.


·         Provide free or discounted parking to Rideshare vehicles.



Parking Pricing represents a significant change from current practices. Most vehicle parking is provided free or significantly subsidized. Of the 95% of U.S. employees who commute by automobile, only 5% pay full parking costs and 9% pay a subsidized rate, and parking is unpriced at more than 98% of non-commute trip destinations (BTS 1992). When parking is priced, there are often substantial discounts for long-term leases and sometimes there is no hourly or daily rental option, leaving motorists with little financial incentive to use alternative modes part time (for example, to Rideshare twice a week).


Parking Pricing can provide significant revenue. Parking facilities represent 5-15% of the annualized cost of a typical building, so charging motorists directly for using parking rather than incorporating parking facility costs into building rents and mortgages could increase property revenues or reduce building rental charges by nearly this amount (additional revenues minus any costs associated with collecting fees). Although a 10% increase in building rents may seem modest, this is equivalent to normal return on investments, indicating that recovering parking costs directly from users could double profits on typical building investments. Similarly, charging for public-owned parking facilities can provide significant revenue to governments. Shoup (2002) estimates that charging market-rate prices for curb parking could yield more revenue than total property taxes in many neighborhoods.


Given a choice, motorists usually prefer unpriced parking. But unpriced parking is not really free, consumers ultimately bear parking costs through higher taxes and retail prices, and reduced wages and benefits. The choice is actually between paying for parking directly or indirectly. Paying directly for parking is more equitable and efficient (Market Principles). There are an estimated 2 off-street and 1-2 on-street parking spaces per vehicle in the U.S., with total annualized value of $1,500 or greater per vehicle (Litman 2009). This averages 12¢ or more per vehicle-mile, about equal to average vehicle operating costs. In other words, charging motorists directly for all parking would approximately double the perceived cost of driving.


This underpricing results in inefficient use of parking facilities and excessive parking demand. In particular, the most convenient parking spaces (such as on-street spaces in commercial areas) are often filled while less convenient spaces (such as commercial fringe area parking, and in parking lots behind buildings) are unoccupied. This reduces motorist convenience and increases traffic problems that can be reduced with more efficient pricing (Arnott and Rowse 2007). Surveys indicate that 8-74% of urban traffic congestion is caused by vehicles cruising for on-street parking, and motorists spend an average of 3.5 to 13.9 minutes finding a curb parking space, both indications of inefficiency due to underpricing (Shoup 2007).


Much of the resistance to Parking Pricing reflects the inconvenience of current payment methods, and obstacles to using alternatives. Parking Pricing can become more accepted if:

·         Better Pricing Methods are used that make pricing more convenient and fair.

·         Transportation and Parking Management strategies are used to improve consumers’ Transportation Choices.

·         Marketing provided better information on parking prices and availability, and transportation alternatives.



How It Is Implemented

Parking price changes are usually implemented by local governments or individual businesses, either as part of a TDM program or for revenue generation. Off-street Parking Pricing is often managed by specialized companies that serve many property owners.


Implementation depends on the objectives. As a Parking Management strategy, prices for the most convenient parking spaces (such as on-street spaces in commercial areas) should encourage turnover, with lower prices or unpriced parking at other locations. As a Congestion Pricing strategy, to address local traffic and parking problems, rates should be higher during peak periods, and the rate structure should be applied consistently throughout the area (such as a commercial center). As a regional TDM strategy, to reduce congestion problems and pollution emission, pricing should be applied throughout a region to avoid simply shifting travel from one location to another, and coordinated with other TDM strategies that encourage use of alternative modes. If implemented for revenue generation, parking prices should be set as high as the market will bear, and competition (such as nearby free parking) should be minimized.


To implement Parking Pricing it is helpful to develop an area-wide parking policy and plan that coordinates parking supply, pricing and management, and addresses spillover parking problems (TDM Planning). Parking Pricing can encouraged by reducing parking supply, for example, by reducing minimum parking requirements for new development, so businesses find pricing cost effective (New Urbanism).


Table 1 summarizes parking Pricing Methods. Newer methods tend to be more cost-effective, convenient and fair. They allow various payment options (coins, bills, prepaid value cards and credit cards), and more adjustable prices. Some systems allow motorists to pay for just the amount of time they are parked, rather than requiring users to prepay for a block of time.


Table 1            Summary of Parking Pricing Methods (Pricing Methods)



Equipment Costs

Operating Costs

User Convenience

Price Adjustability



Parkers purchase and display a pass. Common for leased parking.

Very low



Poor to medium.


Single-Space Meters

Parkers prepay a mechanical or electronic meter located at each space.



Low to medium.

Mechanical meters: poor; electronic meters: good.

Pay Box

Parkers prepay into a box with a slot for each space.




Poor to medium.

Pay-And-Display Meters

Parkers prepay a meter, which prints a ticket that is displayed in their vehicle window.




Mechanical meters: poor; electronic meters: good.

Electronic Pay-Per-Space

Parkers prepay an electronic meter.




Very good.

In-Vehicle Meter

Parkers prepay to use a small electronic meter displayed in the vehicle when it is parked, that counts down minutes.






Parkers pay an attendant when entering or leaving a parking space.





Automated Controlled Access System

Parkers pay a machine when entering or leaving a parking space.






Parkers pay an attendant who parks their car.





Automatic Vehicle Identification

System automatically records vehicles entering and leaving a parking area and can bill for use.





This table summarizes various methods that can be used to collect parking fees.



Setting Parking Rates and Fines

Several factors should be considered when setting parking rates.


Transportation and Parking Management

Parking prices can be set to achieve transportation and parking management objectives:


·         Price the most convenient parking spaces for customers and clients, with minute or hourly rates.


·         Use time variable rates (higher prices during peak periods and lower prices at off-peak times).


·         Price less convenient parking spaces for employees and residents, with weekly or monthly rates.


·         Use Parking Pricing to encourage mode shifting. Integrate Parking Pricing with other TDM strategies that support transportation alternatives.



Cost Recovery

Prices can be set to recover parking facility costs. For example, a business or government may want to price parking to recover costs, without making a profit. Table 2 indicates typical base costs of providing parking facilities (i.e., wholesale costs). Full cost recovery must account for load factors (not all parking spaces are rented each day), and return on investment (borrowing and risk costs).


Table 2           Typical Parking Facility Costs (Parking Evaluation)

Type of Facility

Land Costs

Land Costs

Construction Costs

O & M Costs

Total Cost

Monthly Cost


Per Acre

Per Space

Per Space

Annual, Per Space

Annual, Per Space

Per Space

Suburban, Surface, Free Land







Suburban, Surface







Suburban, 2-Level Structure







Urban, Surface







Urban, 3-Level Structure







Urban, Underground







CBD, Surface







CBD, 4-Level Structure







CBD, Underground







This table illustrates the financial costs of providing parking facilities under various conditions. (CBD = Central Business District)



Table 3 indicates typical cost recovery parking prices. This includes costs for facilities construction, operations and pricing, assuming a 70-90% load factor (portion of parking spaces that are rented during any month).


Table 3            Typical Cost Recovery Parking Prices (Parking Cost Spreadsheet)

Parking Facility

Payment System

Annualized Costs

Monthly Rate

Daily Rate

 Surface, Free Land





 Suburban, 2-Level Structure





 Urban, Surface





 Urban, 3-Level Structure





 CBD, 4-Level Structure




$ 6.50

This table shows the rate needed to recover parking facility costs under various conditions.



Maximize Revenue

Prices can be set to maximize revenue, which is the approach used for most commercial parking. This means setting the highest rates that the market will bear. Rates at other nearby parking facilities set the upper limit that a particular parking facility owner may charge without losing customers.


Table 4            Typical U.S. Parking Prices


Hourly Rate

Daily Rate

Monthly Rate





Urban or Small CBD




Large CBD






Table 4 summarizes typical parking rates by geographic conditions, although these may vary significantly from one location to another (Colliers, 2005). Table 5 shows typical parking prices in major US cities.


Table 5            Average Parking Rates in U.S. Cities (PT, 2000)


Meter (hour)



Early Bird Max


























New York










San Diego





San Francisco





Washington DC







In practice, prices often reflect some combination of these methods. For example, prices may be set to match those of competitors, if there are any nearby, otherwise based on cost recovery. Prices may be higher at peak periods to support TDM objectives, but set at revenue-maximizing levels during off-peak periods.




Fines for parking violations must be high enough and enforced frequently enough to motivate motorists to follow regulations and pay fees, but not so high to be considered excessive or unfair. If fines are too low, some motorists may simply treat them as a parking fee. Fines are typically 2-5 times the downtown daily parking rate.


It is important to have a system to collect outstanding parking fines. This may include use of a boot (a clamp that immobilizes a vehicle) or towing of vehicles that have more than 10 unpaid fines, a restriction on renewing vehicle or drivers licenses if parking fines are outstanding, or use of collection agencies.



Travel Impacts

Parking Pricing can have significant transportation impacts (Transport Elasticities). Even modest parking fees can affect vehicle travel patterns. The price elasticity of vehicle travel with respect to parking price ranges from –0.1 to –0.3 (a 10% increase in parking charges reduces vehicle trips by 1-3%), depending on demographic, geographic, travel choice and trip characteristics (Vaca and Kuzmyak, 2005). Pricing that applies to commuter parking tends to be particularly effective at reducing peak-period travel.


Frank, et al. (2011) used detailed data on various urban form factors to assess their impacts on vehicle travel and carbon emissions. Their analysis indicates that parking pricing can have significant impacts on vehicle travel and emissions. Increasing parking fees from approximately $0.28 to $1.19 per hour (50th to 75th percentile) reduced VMT 11.5% and emissions 9.9%.


Shifting from free to cost-recovery parking (prices that reflect the full cost of providing parking facilities) typically reduces automobile commuting by 10-30%, particularly if implemented with improved Transportation Choices and other complementary TDM strategies (Comsis Corp., 1993; Hess, 2001). However, pricing parking in just one area may simply shift vehicle trips to other locations with little reduction in overall vehicle travel (Hensher and King, 2001). About 35% of drive-alone commuters would likely switch modes in response to $20 per month parking fees, even if offset by a transportation voucher (Kuppam, Pendyala and Gollakoti, 1999).


Table 5            Parking Pricing Impacts on Commute Trips


Canadian Study

Los Angeles Study








Drive Alone




























(Feeney, 1989, cited in Pratt, 1999)



A study by ICF (1997) indicates that a $1.37 to $2.73 increase in parking fees reduces auto commuting 12-39%, and if matched with transit and rideshare subsidies, reduces total auto trips by 19-31%. A survey of automobile commuters found that nearly 35% would consider shifting to another mode if they were required to pay for parking, with fees of $1-3 per day in suburban locations and $3-8 per day in urban locations (Kuppam, Pendyala and Gollakoti, 1998). The table below shows the typical reduction in automobile commute trips that result from Parking Pricing. See Trip Reduction Tables for more information on the automobile commute reductions that typically result from parking fees and other financial incentives.


Table 6            Percent Vehicle Trips Reduced by Daily Parking Fees

Worksite Setting





Low density suburb





Activity center





Regional CBD/Corridor





From Comsis Corporation, 1993. Fees in 1993 U.S. dollars.



One study estimates that Parking Pricing for work trips can reduce regional VMT up to 4.0%, and that Parking Pricing for non-work trips could reduce regional VMT by another 4.2% (Apogee, 1994). Deakin and Harvey (1997) model the effect of minimum employee parking charges in four major urban regions in California. Table 7 summarizes their results. It indicates, for example, that in the South Coast (Los Angeles) region, a $3 per day parking fee would reduce total vehicle trips by about 2.8%, and congestion delay would decline by a much larger amount (8.5%).


Table 7           Impacts of Employee Parking Fees  - Year 2010 (Harvey and Deakin, 1997, Table B.7, in 1991 U.S. dollars)

















Bay Area
































San Diego
















South Coast








Price = minimum daily parking fee for SOV commuters. VMT = change in total vehicle mileage.           Trips = change in total vehicle trips. Delay = change in congestion delay. Fuel = change in fuel consumption. ROG = a criteria air pollutant. Revenue = annual revenue in millions of 1991 dollars. See original report for additional notes.



Parking restrictions and pricing can reduce business activity in an area and shift travel to more suburban locations (Shiftana, 1999), although these impacts depend on specific conditions, including how prices are structured, and the quality of travel and location alternatives. When parking revenues are used to improve business district street conditions or to fund transportation alternatives they can increase business activity in a downtown (Kolozsvari and Donald Shoup, 2003).


How prices are structured affects travel behavior. Significant discounts for long-term parkers (e.g., lower-priced monthly leases) encourage use by commuters, while parking prices and management strategies that discount short-term parking (e.g., “First-Hour-Free” rates) favor shoppers and business trips.


In addition to these direct travel impacts, over the long term Parking Pricing and other Parking Management strategies can help create more Accessible land use and improve Transportation Choices, as discussed in the chapters on Land Use Impacts and New Urbanism.


Table 8            Travel Impact Summary

Travel Impact



Reduces total traffic.


Reduces automobile travel.

Reduces peak period traffic.


Commuter Parking Pricing is particularly effective at reducing peak period traffic.

Shifts peak to off-peak periods.


Variable rates can encourage time shifts.

Shifts automobile travel to alternative modes.



Improves access, reduces the need for travel.


Allows higher-density development.

Increased ridesharing.



Increased public transit.



Increased cycling.



Increased walking.



Increased Telework.



Reduced freight traffic.


Impacts on freight traffic tend to be minor.

Rating from 3 (very beneficial) to –3 (very harmful). A 0 indicates no impact or mixed impacts.



Benefits And Costs

Charging motorists directly for parking provides a variety of benefits and imposes several types of costs, as listed below. See Parking Evaluation for more discussion of these impacts.


Parking Management

Parking Pricing can result in more efficient use of parking facilities, address specific parking problems, insure that parking is available for intended users, and reduce total parking requirements, providing substantial facility cost savings.


Reduced Automobile Use and Congestion

Parking Pricing is one of the most effective ways to reduce motor vehicle traffic. It typically reduces automobile trips by 10-30%, or even more if implemented as part of a comprehensive TDM program. This helps reduce congestion and environmental impacts, and increase road safety.


Efficient Land Use

Parking Pricing allows supports land use management objectives related to Smart Growth, Location Efficient Development, New Urbanism and Access Management. Parking Management can reduce urban sprawl and the environmental impacts that result.



Parking Pricing creates revenues (an economic transfer that is offset by user costs) that can be used to recover parking facility costs and fund other programs.



Unpriced parking represents a cross-subsidy from people who own fewer than average vehicles and drive less than average, to people who own more than average vehicles and drive more than average. This is unfair. Charging motorists directly for parking tends to increase horizontal equity, and can increase vertical equity, depending on how revenues are used (see discussion below).


Parking Pricing costs include:


Pricing Costs

Pricing costs including costs for equipment (signs, parking meters, ticket printers, access gates), attendants, land (such as sidewalk space used by parking meters) and administration. These incremental costs range from less than $50 annually per vehicle for a pass system with minimal enforcement, to more than $500 per space for attendants or an automated control system (Pricing Methods).


Transaction Costs to Users and Facility Owners

Parking Pricing can impose delay and inconvenience to motorists, who are often required to prepay using specific coins or denominations, although newer parking payment technologies can reduce these costs.


Financial Costs to Motorists

Parking Pricing represents a cost to motorists, which is an economic transfer that is offset by revenues to facility owners.


Spillover Impacts in Other Areas

Parking Pricing in just one area may cause spillover impacts in other areas. Parking Pricing may cause motorists to cruise around in search of cheaper parking, although the opposite effect may also occur if Parking Pricing increases parking availability, reducing the need for motorists to cruise for a parking space.


Competitive Disadvantage

Free parking is considered an effective way to attract customers and reward employees. Priced parking can put businesses and commercial areas at a competitive disadvantage if other businesses or areas have abundant, unpriced parking.


Table 9            Benefit Summary




Congestion Reduction


Reduces vehicle travel.

Road & Parking Savings


Reduces vehicle travel and parking requirements.

Consumer Savings


Increases direct costs, but reduces indirect costs. Overall impacts depend on how revenues are used.

Transport Choice


Mixed. Reduces driving affordability, encourages alternative modes.

Road Safety


Reduces vehicle travel.

Environmental Protection


Reduces vehicle travel.

Efficient Land Use


Reduces vehicle travel.

Community Livability


Reduces vehicle travel and can reduce the amount of land devoted to parking facilities.

Rating from 3 (very beneficial) to –3 (very harmful). A 0 indicates no impact or mixed impacts.



Equity Impacts

Parking Pricing has mixed Equity impacts. Charging motorists directly for the parking they use is fairer (increases horizontal equity) than indirect payment that results in cross-subsidies from consumers who own drive less to those who drive more than average. Parking Pricing can be considered unfair if applied selectively, imposing costs on lower-status employees working in commercial centers, but not on higher-status employees or those at suburban worksites.


Parking charges are regressive (they represent a greater share of income for less-wealthy motorists), but not necessarily more regressive than alternative sources of paying for parking facilities, such as general taxes. Since automobile ownership and use tend to increase with income, higher-income people tend to capture the majority of parking subsidies. Using parking revenue to reduce general taxes or improve travel alternatives can benefit lower-income people overall. Unbundling parking from housing can increase housing affordability and benefit lower-income households (Location Efficient Development).


Parking Pricing encourages the use of alternative modes, and helps create more accessible and pedestrian-friendly land use patterns, which tends to benefit people who are transportation disadvantaged. It can improve basic access by guaranteeing that more parking spaces are available for high-value trips, when users are willing to pay.


Table 10          Equity Summary




Treats everybody equally.


Parking Pricing is often applied selectively.

Individuals bear the costs they impose.


Reduces subsidies to driving.

Progressive with respect to income.


Charges are regressive, but not necessarily more regressive than other funding sources.

Benefits transportation disadvantaged.


Reduces parking costs borne by non-drivers. Encourages development of alternative modes and more efficient land use.

Improves basic mobility.


Makes parking available for higher-value trips.

Rating from 3 (very beneficial) to –3 (very harmful). A 0 indicates no impact or mixed impacts.




Parking Pricing is most common in major commercial and recreational centers, and large cities. It is particularly appropriate where:


·         Land values and parking facility costs are high.

·         Parking supply is insufficient to meet demand.

·         Traffic congestion or vehicle pollution are significant problems.

·         Clustered land use, infill development and reduced pavement area is desirable.

·         Administrative and enforcement resources exist.



Table 11          Application Summary





Large urban region.


Federal government.


High-density, urban.


State/provincial government.


Medium-density, urban/suburban.


Regional government.




Municipal/local government.


Low-density, rural.


Business Associations/TMA.


Commercial center.


Individual business.


Residential neighborhood.




Resort/recreation area.


Neighborhood association.






Ratings range from 0 (not appropriate) to 3 (very appropriate).




Incentive to Reduce Driving



Relationships With Other TDM Strategies

Parking Pricing supports and is supported by most TDM strategies. It is one Parking Solution and Parking Management strategy. It is helpful to consider different Pricing Methods and Parking Evaluation approaches. It is an important component of Commute Trip Reduction and Campus Trip Reduction programs. It is more feasible if implemented with improvements to Transit, Ridesharing and Nonmotorized Transport. It is an important component of Smart Growth, New Urbanism and Location Efficient Development.




Parking Pricing is usually implemented by local governments or developers and businesses that own and manage parking facilities. Implementation may require support and coordination of local governments, business associations, individual businesses, neighborhood associations and individual residents. Local police may be involved in enforcement activities. Private companies often provide parking management equipment and services.



Barriers To Implementation

Parking Pricing implementation faces various barriers:


·         Motorists are accustomed to receiving subsidized parking, and so often resent and oppose Parking Pricing. They see it as an additional new cost, rather than a different way to pay for a service they use.


·         Planning professionals have well-established systems to address parking problems by increasing parking supply through zoning requirements and public subsidies.


·         Current minimum parking standards are generous. They reflect demand in suburban areas with unpriced parking, and are therefore excessive for urban areas, where parking is priced, or where TDM programs are implemented (Shoup, 1999). This reduces potential parking prices to the point that collecting the fees is not cost effective.


·         Individual businesses and commercial districts use free parking to attract customers and reward employees.


·         Abundant parking supply causes businesses to consider parking facilities a “sunk” cost, with little marginal value. Unless a business can sell or lease excess parking capacity, they may perceive little financial benefit from encouraging their employees and customers to reduce their parking demand.


·         Income, sales and property tax policies favor unpriced parking. A typical employee would need to earn about $2,000 in additional pre-tax annual income to pay for a parking space that costs an employer about $1,000 a year to provide. As a result, businesses and labor organizations consider parking to be an attractive employee benefit.



Businesses often resist Parking Pricing because they believe it puts them at a competitive disadvantage with other businesses that offer abundant, free parking. However, businesses ultimately bear the costs of free parking, which they must pass on to customers, and providing free parking can constrain business decisions. For example, the need to provide abundant free parking may prevent a business from expanding its building or limit location decisions. Providing free employee parking can reduce the availability of customer parking. Parking Pricing and other Parking Management strategies can be more profitable to businesses and support economic development better than current practices based on abundant, free parking. Real estate market analysis suggests that traditional urban areas, where parking is limited and priced, often experience greater economic growth than suburban areas (LLREI, 2000). This suggests that Parking Pricing is not necessarily harmful to local economic development if an area is attractive and accessible in other ways.



On The Street Where You Park: Privatizing Residential Street Parking Will Keep The Lilacs Blooming, The Larks Singing And The Pavement To A Minimum

By Lawrence Solomon, Next City, 21 Dec 1995 (


On my street in downtown Toronto, presumably out of a sense of fair play, the street parking used to alternate every month — one month the parking would be on the east side, the next the west, and so on. The result was bedlam once a month. People forgot to switch and ran out in their bedclothes to avoid getting ticketed. It was worse in winter — people caught colds. And sometimes the schedule changed because of holidays.


This problem of alternating parking is not limited to my district in Toronto, of course. This problem unites English-speaking Canada and French-speaking Canada. This problem thrives south of the border. To help out harried homeowners in New York City, an entrepreneur has been publishing something called "The New York City Alternate Side of the Street Parking Calendar" for more than a decade. The current edition lists 153 days that vehicles don't have to switch sides. Canada doesn't have a similar planning aid. And in my area of Toronto, at least, this system of sharing the misery proved unbearable.


Then somebody got a better idea. Parking would be allowed only on one side, the east side. No more switching back and forth. It was a simple solution to the bedclothes problem. But people were still dissatisfied: Parking was still unpredictable — you couldn't always count on a nearby parking spot. In fact, you couldn't always count on a spot being available anywhere.


There was a shortage of parking spots, and to get one you had to wait in line, sometimes for six months. So, the city started rationing the use of street parking. Only one spot per household — if you had a nice, large extended family and needed two cars, a second spot cost six times as much as the first — about the same cost as renting parking privately. This nudged people to move to houses with garages, or to install one, or to build a parking pad on their front lawns.


But that form of rationing still wasn't enough. So the commissars at city hall issued a new decree — anyone with a garage or with parking on his lot was no longer entitled to inexpensive parking on the city street. Now people with two cars had an extra incentive to build two-car garages, or two-car parking pads, or to move to the suburbs.


Due to conundrums like these, people on the west side of the street decided to convert their front lawns to parking pads. The city gave approval readily, because that side wasn't used for parking any more, and no one objected on parking grounds. And people on the east side, who didn't have parking pads, generally liked the trend, since every new pad meant less competition for spots on the east side of the street.


Ah, but people will never leave well enough alone. The saga continues. Now people on the east side want to put in parking pads, and the street is up in arms. When people park on their front yards, it doesn't free up parking on the street because the driveway is about as wide as the length of a car. So, while the front yard parker gains, his neighbors don't. In fact, they lose, because they have a bit less flexibility — they now have a smaller pool of parking spots to choose from. As each new request for a parking pad appears, it creates not only opposition, but an incentive for others to stop fighting and join the trend. If nothing is done to stop this trend, most people on both sides will be parking on their front yards. We will have cleared cars from the parking lane on the street, and moved them onto front yards. Put another way, we'll be seeing more concrete, less lawn and fewer gardens.


The planners have decided to stop this by a crude form of democracy. The dozen or so neighbors just north and just south of any proposed new parking pad get to vote — if 25 per cent turn thumbs down, no pad. But no matter which way the vote goes, we have unhappy parkers.

There's got to be a better way to do all this and there is. Here's my planning solution for this and other rationing problems. Like most of my solutions, my approach is pre-Keynesian and very traditional: No eggs get broken. My plan is voluntary, it involves privatizing a commonly held resource, and it involves recognizing property rights and creating competition to minimize the need for regulation.


Of course, the status quo — the chaotic process that I've just described that is creating all these parking pads — also involves privatizing a societal resource. But the status quo privatizes without compensation for society. When society okays a parking pad for a homeowner, the street in front of his pad is no longer available to everyone for parking, but only to the homeowner and his visitors for access. Although people don't think of this as a form of privatization, that little bit of street has been privatized as surely as if Mike Harris had done it through legislation. All the neighbors lose; the one homeowner gains. And his gain can be substantial. In my neighborhood, in fact, because parking is scarce, the permit alone for a pad can be worth $10,000. People often apply for a permit for a pad just before they move, in order to fetch a higher selling price.


This method of allocation of resources is ambiguous and perverse — why should the individual homeowner gain at the community's expense? This method is also environmentally harmful — that parking pad not only removes green space, its asphalt helps heat up the city, which increases the air conditioning load and may exacerbate global warming. Another effect of removing street parking: Traffic speeds increase. Street parking has a well-known traffic calming effect. Without street parking, the neighborhood streets become thoroughfares for commuters looking for shortcuts around congested main streets.


Instead of this perverse form of privatization, where people have ambiguous rights, I propose we unambiguously privatize the street parking, by selling outright the street parking space outside homes outright to homeowners. The parking spots on the street in front of your home should be yours if you want them. Others, whether pedestrians or vehicles, would retain an easement over the street parking spots. They could cross them freely, but they wouldn't be able to occupy those spaces without your permission any more than they can park in your driveway without your permission.


Just think how this would revolutionize parking. Imagine that you're a homeowner, with a 25-foot lot, wide enough for one small car and one large car — and that you could buy the strip of road in front of your house for fair market value, say, $1,000 a linear foot. If you had two cars, you might buy all 25 feet. If you had one small car, you might buy 10 feet, and someone else in the neighborhood, perhaps someone across the street with a larger car, might buy the other 15 feet. Now you would both have secure parking, and no incentive to pave over your front yard. Suddenly, that problem is solved. The city would no longer be destroying our green spaces.

The city would have been paid market value for the piece of street it just sold, so now there's money in city coffers. Taxpayers aren't being ripped off, and you would have an incentive to buy a smaller car — especially once it sinks in that every extra foot tacked onto your car cost you an extra $1,000.


But the benefits to society are just beginning. Most likely, you don't need that spot 24-hours a day and, if you wish, you can make it available to others when you're not using it, the same way people with unused garages rent them out to people in their neighborhood. You can do this informally — by working out an arrangement with a neighbor — or you can install your very own, personal parking meter, available for use by others during whatever hours you yourself specify, at whatever price you yourself wish to charge. This would also eliminate another problem created by rationing — there's no system in place for temporary users, such as guests or tradesmen, in neighborhoods with tight parking. My neighbors down the street who are renovating their house were surprised to learn that the city refuses to issue temporary daytime parking permits for the contractors, even though the street has plenty of daytime parking. As a result, one contractor bidding for the job added more than $2,000 to his quote — a great way to make the city more affordable. The contractor who got the job — a different contractor — is routinely ticketed for illegal parking, but thanks to connections at city hall, just as routinely has the tickets torn up — a great way to promote clean government.


Petty corruption aside, privatizing street parking in the way I suggest would ensure that affordable parking was always available for visitors — in economic terms, this resource called street parking would now be allocated efficiently.


People wouldn't be circling the block waiting for spots to open, or parking illegally too near street corners, or too near the front of other's driveways. They would be saving themselves time because parking would always be available, and they would be saving society pollution from their exhaust.


Now let's look at another car problem that neighborhoods face: unwanted traffic from drivers taking shortcuts through neighborhoods. To foil these people, planners have turned neighborhoods into mazes of one-way and wrong-way streets. These mazes are effective at keeping out through traffic, but they also confuse residents and their visitors. I defy anyone who wants to visit me at my home before 9 a.m. any weekday to do so without taking an illegal turn — there is a way, but it took me years to discover it.


For a while, a colleague of mine who lives two blocks away in the same neighborhood often picked me up mornings on the way to regulatory hearings we were attending. It took this lawyer weeks to figure out how to do it legally, but it's so awkward that he prefers the illegal turn. Another colleague, who has just learned that her neighborhood's streets are going to be remapped, swears the proposed plan is so confusing that there is no way she will be able to reach her house by car legally.


Neighborhood mazes, of course, are not always enough. So streets get barricaded to add to the misery of street users, and speed bumps get installed to slow down traffic. The upshot of this form of planning is that grown-ups, at any time of day or night, can be seen driving around in circles, and stopping and starting at speed bumps. Merchants on the main streets bordering the neighborhoods also suffer, because their customers often lose easy access to the neighborhood store.


And why?


The main things neighborhoods dislike about drive-through traffic are the noise and the hazard. These drivers take shortcuts because they're frustrated and in a hurry, and they often exceed the neighborhood speed limit. Now, has anyone asked why legions of drivers traveling from A to B on a main artery would prefer to detour through residential neighborhoods to get to their destination?


They don't do it for the scenery. They do it out of frustration with clogged arterial roads, out of frustration with a road system that creates bumper-to-bumper traffic. They do it because of incompetent rush-hour traffic management. Planners have failed abjectly here — all we've had are feeble efforts such as car pooling, or destructive ones such as freeways or the encouragement of businesses to move away from congested areas. For the most part, planners use congestion to ration the use of the roads.


Yet traffic problems would vanish if we stopped pricing the use of our roads at zero. Charge people for the use of roads — all roads — and watch reason enter this irrational world. The British have taken the first step on this journey — they are in the process of converting all highways to toll roads that will be charging drivers by time of day and by distance traveled. Their next step — which politicians openly say will not be introduced until after the next election — involves congestion charges for the City of London. But in Canada, we haven't even begun to think of taking these self-evident and necessary steps, despite the enormous benefits that would flow from them.


With time-of-day pricing, fewer cars would be traveling at peak times, more at off-peak. Car pooling would pick up. Public transit's market share would increase. Detours through neighborhoods won't be routinely taken to bypass congested traffic because congested traffic would become a thing of the past.


Excerpted from Lawrence Solomon's keynote address on the occasion of the 25th anniversary of Queen's University's School of Urban and Regional Planning, October 1995.



Best Practices

Pratt (1999), Rye and Ison (2005), Shoup (2006) and Litman (2006a & b) provide suggestions for Parking Pricing implementation and management. Also see Parking Policy Evaluation and Parking Solutions. Best practices include:













Wit and Humor

The other day I saw two dogs walk up to a parking meter. One says to the other, “What do you know, paid toilets!”



Examples and Case Studies

Comsis (1993), ICF (1997), and K.T. Analytics (1995) describe various Parking Pricing programs implemented as part of TDM programs.



Redwood City (

The Redwood City, California parking ordinance is written to achieve efficient parking fees and return revenues to local business districts. It was adopted unanimously by the city council in 2005, and is supported by local business leaders.  Here are some excerpts from the ordinance:


To accomplish the goal of managing the supply of parking and to make it reasonably available when and where needed, a target occupancy rate of eighty-five percent (85%) is hereby established.


At least annually and not more frequently than quarterly, the Parking Manager shall survey the average occupancy for each parking area in the Downtown Meter Zone that has parking meters. Based on the survey results, the Parking Manager shall adjust the rates up or down in twenty-five cent ($0.25) intervals to seek to achieve the target occupancy rate.


Revenues generated from on-street and off-street parking within the Downtown Meter Zone boundaries shall be accounted for separately from other City funds and may be used only for the following purposes:

A. All expenses of administration of the parking program

B. All expenses of installation, operation and control of parking equipment and facilities within or designed to serve the Downtown Core Meter Zone

C. All expenses for the control of traffic (including pedestrian and vehicle safety, comfort and convenience) which may affect or be affected by the parking of vehicles in the Downtown Core Meter Zone, including the enforcement of traffic regulations as to such traffic.

D. Such other expenditures within or for the benefit of the Downtown Core Meter Zones the City Council may, by resolution, determine to be legal and appropriate.


“S.F. Plans Market Rates For Prized Parking Spaces,” San Francisco Chronicle, 12 Oct. 2007,  

San Francisco On-Street Parking Management and Pricing Study (

The 2004 San Francisco Countywide Transportation Plan identified the need for better parking management at the neighborhood level. It called for improved on-street parking management through a variety of strategies to support policy goals and improve on-street parking conditions. In response the Transportation Authority undertook the On-Street Parking Management and Pricing Study to assess on-street parking conditions and investigate innovative approaches for more efficiently managing San Francisco's curbside parking. The study:



The study reached the following key conclusions:


Effective parking management requires a neighborhood-level approach. On-street parking management should be planned and coordinated at the neighborhood level, with attention to the tradeoffs associated with any strategy and the interactions between component parts of the parking supply (i.e., individual block faces and off-street supplies). Neighborhood-level parking management requires flexible approaches that can be tailored to an area’s conditions, needs, and priorities, which must evolve over time to reflect changing land use and travel patterns.


Existing management strategies are ill-suited for confronting key parking challenges. On-street parking regulations have developed incrementally over time, such that many neighborhoods are subject to an uncoordinated management regime that is misaligned with parking conditions and management needs. Existing strategies cannot address parking availability when there is an imbalance between supply and demand.


The most promising management approach for addressing imbalances between supply and demand is pricebased regulation, which also has significant secondary benefits. Variable pricing of on-street spaces according to parking demand is a strategy to ensure sufficient availability, improve utilization, and value on-street space appropriately. Addressing availability—within the confines of finite supply in an urban environment—is the central purpose and benefit of parking pricing. Secondary benefits include a reduction in “cruising” behavior and the opportunity to reinvest new parking revenues in transportation improvements.


Underpriced parking represents a significant source of untapped revenue that could be dedicated to transit-first uses; attempts to close this pricing gap must be planned and executed carefully, in a manner that the public will understand and support. Given that on-street parking in many areas is currently minimally regulated, future revenue gains have the potential to be substantial. It is doubtful that the public will support widespread parking charge increases without a clear link to tangible transportation improvements in the city’s neighborhoods. The “user fee” principle is also supported by providing a high-quality parking experience through improved payment options, real-time information, and flexible time limits. Currently, parking revenues are a crucial source of locally-generated and locally-controlled funding, which is prioritized to support Muni operations. Reinvestment of a portion of future new revenues will encourage neighborhood-level support for parking pricing, thus increasing the overall pool of funds from which transit stands to benefit.


Current parking policies contradict other planning objectives and warrant significant reform. Reforms to residential parking management are warranted to better value on-street space, create a more multimodal program, and provide more equitably distributed costs and benefits. Neighborhoods should have the ability to utilize pricing strategies to manage parking demand while returning benefits to the area in which revenues are collected.


The report made the following recommendations:


·         Re-balance the allocation of on-street spaces. The goal of re-balancing is to better accommodate varying demands within the confines of scarce supply. Examples of rebalancing include periodic consideration of the demand for commercial loading zones and evaluation of the appropriateness of various time limitations. This assessment should be done in cooperation with neighborhood residents and merchants, and other strategies and tools should be considered along with conventional regulatory strategies.


·         Regulate unregulated or under-regulated spaces. Where warranted, currently metered areas could be expanded, or unregulated spaces could be otherwise regulated. For example, studies in the Glen Park and Balboa Park neighborhoods revealed a substantial number of unregulated spaces that contributed to parking shortages and low turnover; these issues have since been remedied or are in the process of being addressed. A technical evaluation is required to identify the best regulatory design (e.g., meter vs. time limit vs. color curb). Typically, meters have been confined to the downtown area and neighborhood commercial corridors (and some adjoining blocks). Extending metering hours into the evening (until 10:00 p.m., for example) is appropriate in those areas with evening parking generators, such as restaurants or nightlife, where turnover is desirable, provided that adequate enforcement can be provided. Extension of metering into evening hours can provide a significant benefit to local commercial activity, by prioritizing metered spaces during high demand periods for shorter-term uses (rather than overnight storage).


·         Reform residential parking permit management. The existing RPP program provides benefits to a small group—eligible permit holders that store their car(s) on-street during weekday middays.


·         Establish a policy on the use of new incremental parking revenue. SFMTA has not articulated a clear policy on the use of any revenue gains associated with implementation of demand-responsive pricing. It is important to affirm the policy of applying the revenues to parking improvements and transit-first uses. SFMTA should clarify this policy and allow for public review and input into this decision.


·         Share some portion of net new revenues with the areas in which the monies are collected. By investing in the neighborhoods affected by parking pricing, tangible benefits will accrue to the areas that are priced and local impacts are mitigated. The public will be skeptical of any program that simply provides incremental revenue to an opaque budget that funds programs across the entire city. Specifically, it is recommended that if demand-responsive pricing results in at least 50% growth in parking revenue in a neighborhood, at least 25% of the net new revenue should be returned directly to the area in which it was collected. The affected community should have an opportunity to provide input into the program of projects funded by the parking revenue. This will help generate support for pricing programs, as well as increase the overall pool of funds from which Muni stands to benefit.


·         Pursue data-driven pricing policy, in support of articulated performance objectives. Ongoing system monitoring is a crucial component of demand-responsive parking pricing. This monitoring and analysis facilitates ongoing management and operation of the system guided by street-level outcomes.


·         Adjust parking rates systematically. In order to be effective, demand-responsive pricing requires periodic adjustments to parking rates. These adjustments must be performed frequently enough to seek the desired availability target but not so frequently as to obscure the behavior response. Overly frequent rate changes are also likely to engender public consternation and confusion. Monthly adjustments are appropriate for the first several months of implementation in a given area to allow for program managers to find the necessary price structure to meet performance objectives. Following the initial period, less frequent adjustments (such as quarterly) are warranted.


·         Coordinate demand-responsive pricing implementations in metered areas with the regulations in place on unmetered blocks, including warranted expansions of metered areas. The implementation of demandresponsive pricing is a unique opportunity to better manage parking on a neighborhood or area level. Current policies create an artificial distinction between blocks designated as commercial and residential. As demand-responsive pricing is implemented in neighborhoods, an assessment of parking conditions in metered and unmetered blocks is necessary. This assessment may reveal a need to expand the metered areas and/or metered time periods as new payment technologies and pricing strategies are implemented.


A Recommended Approach to Neighborhood Management: Parking Benefit Districts

Pricing is the most efficacious means of managing on-street parking when occupancy routinely exceeds practical capacity. A Parking Benefit District (PBD) program could be made available to neighborhoods facing parking challenges, regardless of whether the neighborhood is currently covered by an RPP. The PBD program would incorporate the following components:


• Allow neighborhoods to opt-in. Neighborhoods could elect (through an adopted administrative process) to create a PBD. If the neighborhood is currently covered by an RPP, the PBD would replace the RPP (or applicable portion thereof).


• Employ price-based regulation and associated elements. Variable pricing is necessary to effectively manage on-street parking in high-demand neighborhoods. New technology would be deployed to allow for variable pricing, user information, and enhanced enforcement. The hours during which parking is priced would be evaluated and modified as necessary. Conventional strategies, such as provision of loading zones, would be reevaluated and adjusted appropriately.


• Expand metering to areas with peak parking demands in excess of 85%. All blocks with practical capacity issues warrant price-based management. Expansion of metering into areas traditionally designated as “residential” could potentially be paired with an exemption for preferential permit holders (priced at higher than current rates, as discussed above) at all or some times of day.


• Provide parking privileges to preferential permit holders at an appropriate price point. Residents of the neighborhood would be permitted to purchase monthly permits for on-street parking on residential streets in the neighborhood. Permits should be priced at a high enough level to appropriately value on-street space and reduce demand for on-street parking (by encouraging offstreet parking, reduced vehicle ownership, etc.).


Invest a portion of net new revenues within the neighborhood and involve the community in prioritizing expenditures. This is the central element of PBDs. By pairing the PBD concept with price-based regulation there is even greater opportunity for neighborhoods to reap the benefits of pricing—through improved parking reductions and a reduction in traffic volumes, as well as through funding available to invest in local transportation projects.


• Recognize the limits of fully addressing peak demand in residential areas. In many neighborhoods, demand for overnight on-street parking is especially high. Overnight parking demand is likely to be managed to some extent by higher preferential permit fees, but even a price-based PBD program must recognize the limits of using price during very late hours when enforcement is more of a challenge. It is important to note that on-street occupancies in excess of 85 percent may be more tolerable during the late-night periods, when traffic volumes are light, and businesses and other activities are less dependent on prioritizing short-term parking and ensuring sufficient availability.


These strategies represent a significant change for any neighborhood. As such, neighborhoods should be involved in choosing the amount and type of price-based regulation and supporting strategies that are desired in a given area. Because more aggressive strategies will provide more revenue, higher levels of benefit should returned to those neighborhoods that are most willing to proactively manage on-street parking through price-based regulation and restructured residential permit parking.



Downtown Pasadena Redevelopment (Kolozsvari and Shoup, 2003)

During the 1950-70s Old Pasadena’s downtown had become run down, with many derelict and abandoned buildings and few customers, in part due to the limited amount of parking available to customers. Although curb parking had two-hour limits, this was poorly enforced. Many employees simply parked in the most convenient curb spaces and moved their vehicles a few times each day. The city proposed pricing on-street parking as a way to improve parking for customers. Many local merchants originally opposed the idea. As a compromise, city officials agreed to dedicate all revenues to public improvements that make the downtown more attractive. A Parking Meter Zone (PMZ) was established within which parking was priced and revenues were invested.


With this proviso, the merchants supported the proposal. They began to see parking meters as a way to fund the projects and services that directly benefit their customers and businesses. Because downtown parking had previously been unpriced, the city didn’t lose any funding by dedicating the revenue to improvements in that area. In fact, the city gained revenue from overtime fines.


The city formed a PMZ advisory board consisting of business and property owners to recommend parking policies and revenue distribution. The resulting investments included new street furniture and landscaping, more police patrols, street lighting, more street and sidewalk cleaning, pedestrian facility improvements and marketing, such as area maps showing local attractions and parking options. To highlight these benefits to motorists, each parking meter has a small sticker which reads, “Your Meter Money Will Make A Difference: Signage, Lighting, Benches, Paving”


This created a “virtuous cycle” in which parking revenue funded community improvements that attracted more visitors, which increased parking revenue, allowing further improvements. This resulted in extensive redevelopment of buildings, new businesses and residential development. Parking is no longer a problem for customers, who can almost always find a convenient space. Local business activity and sales tax revenues have increased far faster than in other shopping districts with lower parking rates, and nearby malls that offer free customer parking. This indicates that charging market rates for parking with revenues dedicated to local improvements can be an effective ways to support urban redevelopment.


Gone Parkin’

By Donald Shoup, New York Times, March 29, 2007

Most people view traffic with a mixture of rage and resignation: rage because congestion wastes valuable time, resignation because, well, what can anyone do about it? People have places to go, after all; congestion seems inevitable.


But a surprising amount of traffic isn’t caused by people who are on their way somewhere. Rather, it is caused by those who have already arrived. Streets are clogged, in part, by drivers searching for a place to park.


Several studies have found that cruising for curb parking generates about 30 percent of the traffic in central business districts. In a recent survey conducted by Bruce Schaller in the SoHo district in Manhattan, 28 percent of drivers interviewed while they were stopped at traffic lights said they were searching for curb parking. A similar study conducted by Transportation Alternatives in the Park Slope neighborhood in Brooklyn found that 45 percent of drivers were cruising.


When my students and I studied cruising for parking in a 15-block business district in Los Angeles, we found the average cruising time was 3.3 minutes, and the average cruising distance half a mile (about 2.5 times around the block). This may not sound like much, but with 470 parking meters in the district, and a turnover rate for curb parking of 17 cars per space per day, 8,000 cars park at the curb each weekday. Even a small amount of cruising time for each car adds up to a lot of traffic.


Over the course of a year, the search for curb parking in this 15-block district created about 950,000 excess vehicle miles of travel — equivalent to 38 trips around the earth, or four trips to the moon. And here’s another inconvenient truth about underpriced curb parking: cruising those 950,000 miles wastes 47,000 gallons of gas and produces 730 tons of the greenhouse gas carbon dioxide. If all this happens in one small business district, imagine the cumulative effect of all cruising in the United States.


What causes this astonishing waste? As is often the case, the prices are wrong. A national study of downtown parking found that the average price of curb parking is only 20 percent that of parking in a garage, giving drivers a strong incentive to cruise. As George Costanza once said on “Seinfeld”: “My father never paid for parking, my mother, my brother, nobody. ... It’s like going to a prostitute. Why should I pay when, if I apply myself, maybe I could get it for free?”


Like George Costanza, drivers often compare parking at the curb to parking in a garage and decide that the price of garage parking is too high. But the truth is that the price of curb parking is too low. Underpriced curb spaces are like rent-controlled apartments: hard to find and, once you do, crazy to give up. This increases the time costs (and therefore the congestion and pollution costs) of cruising.


And, like rent-controlled apartments, underpriced curb spaces go to the lucky more often than they do to the deserving. While the car owner with good timing can enjoy his space free or cheaply for hours or days, others who are late for a meeting or a job interview are left to circle the block, making themselves — and other drivers — miserable. The solution is to set the right price for curb parking.


To prevent shortages, some cities have begun to adjust their meter rates (using trial and error) to produce about an 85 percent occupancy rate for curb parking. The prices vary by location and the time of day. Drivers can usually find a vacant curb space near their destination, and the search time is zero. Cities can adjust the price of curb parking in response to demand to keep roughly one out of every eight spaces vacant throughout the day. Right-priced curb parking can eliminate cruising.


The balance between the varying demand for parking and the fixed supply of curb spaces is the Goldilocks Principle of parking prices: the price is too high if too many spaces are vacant, and too low if no spaces are vacant. But when only a few spaces are vacant, the price is just right, and everyone will see that curb parking is both well used and readily available.


Beyond the transportation and environmental benefits, performance-based prices for curb parking can yield ample revenue. If the city uses a share of this money for added public services on the metered streets, residents and local merchants will be more willing to support charging the right price for curb parking. These funds can be used to clean and maintain sidewalks, plant trees, improve lighting, remove graffiti, bury utility wires and provide other public improvements. Returning the meter revenue generated by a district to the district can persuade residents, merchants and property owners to support right-priced curb parking.


Redwood City, Calif., for example, sets its downtown meter rates to achieve an 85 percent occupancy rate for curb parking (the rates vary by location and time of day, depending on demand). Because the city returns the revenue to pay for added public services in the metered district, the downtown area will receive an estimated $1 million a year for increased police protection and cleaner sidewalks.


The Redwood City merchants and property owners all supported the new policy when they learned what the meter revenue would help pay for, and the City Council adopted it unanimously. Performance-based prices create a few curb vacancies so visitors can easily find a space, the added revenue pays to improve public services, and the improved public services create political support for the performance-based prices.


If cities want to reduce congestion, clean the air, save energy, reduce greenhouse gas emissions and improve neighborhoods — and do it all quickly — they should charge the right price for curb parking, and spend the resulting revenue to improve local public services.


Getting that price right will do a world of good.


Donald Shoup, a professor of urban planning at the University of California, Los Angeles, is the author of The High Cost of Free Parking.



Whistler (

The Resort Municipality of Whistler, British Columbia first introduced paid parking in July 2009 to raise revenue and more efficiently manage utilization of municipal parking facilities. There was considerable community opposition based on the following criticisms (



In response the city council delayed parking pricing implementation for several months and adjusted the rates to offer discounts for shorter terms and local users ( The revised rates are $1 for the first hour, $2 for the second, $2 for the third and $4 for the fourth, with a $5 evening rate between 5 p.m. and 10 a.m in the major underground lot. Whistler residents can receive refunds for time not used when they pay for parking.



On-Street Parking Management and Pricing Study (

The San Francisco On-Street Parking Management and Pricing Study (called SFpark) investigates innovative strategies such as pricing of on-street parking supply more widely as a transportation demand management tool ( It is designed to increase the daily utilization and general availability of on-street parking in congested neighborhoods while also generating revenues to fund needed transportation improvements. The SFpark pilot projects will use three main strategies to achieve the goal of reducing the number and duration of automobile trips and related congestion:

  1. Demand-responsive pricing to manage parking demand towards specific availability targets. This will apply the following principles:

·         Adjusting prices to establish an appropriate relationship between the prices of on- and off-street parking in order to eliminate the financial incentive to circle for on-street parking.

·         Using new meters that make paying for parking convenient.

·         Instituting a higher level of consistent parking enforcement using a combination of low- and high-tech strategies that will improve enforcement’s cost-effectiveness.

·         Changing when parking is managed with pricing (i.e., when parking is priced).

·         Relaxing parking time limits to emphasize the use of parking price rather than time limits as the way to achieve availability targets.

·         Testing new approaches to residential parking management to help address spillover parking.


  1. Rate structures to manage on- and off-street parking as a means to help manage congestion.
  2. Real-time information to drivers on the location, availability, and price of parking before and during trips to inform trip decisions and help drivers find a parking place more quickly.



San Francisco Commercial Parking Tax (

The city of San Francisco imposes a 25% tax on all commercial parking transaction (“any rent or charge required to be paid by the user or occupant of a parking space.”) The city collects nearly $50 million annually from this tax, and expects this revenue to increase if parking operators implement better revenue control systems (PT, 2001). Revenues are divided between the city’s general revenue, public transportation and senior citizen funds.


Dutch National Car Park Policy

The Dutch Coordinated National Car Parking Policy (CROW, 1994) has been successful in reducing automobile parking subsidies by encouraging more accessible development and reducing the tendency of businesses and local governments to provide free parking.



Portland’s Parking Meter Pay Stations Pay

In early 2002 the City of Portland authorized installation of pay station technology to replace its aging coin parking meters. With over 7,000 meters in operation, this was a major undertaking.  The SchlumbergerSema manufacturers “smart meter” pay station was selected. These cost about $6,100 each and replaced up to 9 meters per block face, compared with about $650 for a new coin meters. The smart meters are solar powered, accept credit cards and require less sidewalk space.


To use this system:

1. User goes to the pay station.

2. Pays by coin, credit, debit or smart cards.

3. Takes the sticker receipt back to their car and places on the dashboard.


The city originally planned to phase these meters in over five years, but has accellerated this to three years due to srtong public acceptance and and cost efficiency. In 2002 about 150 stations were in place, in 2003 another 885 were added and now about 1,130 stations are in place. Each serves an average of 6.7 parking spaces. Over 55% of parking transactions are with credit or debit cards and about 1% with smart cards. This is particularly beneficial for longer-term users, who would have needed almost half a roll of quarters to pay for parking. The sidewalk space created by removal of parking meter posts has been favorably received by streetside business (cafes and bistros) as about 2-3 feet of sidewalk space was reclaimed.


The city devoted considerable attention to developing the station’s two-way communication system, which allows individual stations to report when they are nearly full or need maintenance.  The stations typically jam about once a year, compared with about 4 times per year for coin meters. Automated recording systems imporve revenue management and security. Enforcement staff efficiency has increase with imporved system managmeent based on electonic hand-held ticket writing devices, similar to a PDA. These efficiency gains have increased net revenue, from about $7.5 million in 2001/02 to about $9.7 million in 2004/05.


Portland was the first large city in North America to change over the majority of its meters to pay stations. Many other cities are now making the change, including nearby Seattle and Tacoma. These cities are also looking into ways to share smart card technology, so the same card can operate in each city. They are also investigating technologies that allow cell phone payments and the ability to validate/approve credit card use prior to transactions. With this growing demand, the number of automated parking station manufacturers is increasing, from about 12 when Portland began its research to nearly 25 now.


How the politics of parking can defile a city - Ideas - How the politics of parking can defile a city

Tim Falconer, The Star, May 11, 2008; at


Tolls may be an idea that some people and some cities are finally willing to debate, but free parking remains the blind spot in urban and transportation planning. I'd heard various estimates (four, eight, 13) for the number of parking spots per car in North America, and I have to admit that, initially, I was shocked. After all, like most people, when I'm driving around hunting for a legal space – all the while burning fossil fuels, spewing emissions and adding to the traffic congestion – it never occurs to me that North American cities devote so much space to parking.


But the typical driver has a parking spot at home and one at work (usually bigger than the cubicle he or she spends all day in) as well as shared spots at malls, stores, restaurants and even churches.

We're so accustomed to abundant free parking that we resist paying for it, hate looking for it and, most of all, dread getting tickets. As Donald Shoup, America's parking guru, told me, "Everybody thinks parking is a personal problem, not a policy problem." But everybody is wrong.


Born in California in 1938, Shoup was living in Honolulu when the Japanese attacked Pearl Harbor in 1941. Now a professor at UCLA's urban planning department and the author of The High Cost of Free Parking, he has a growing band of followers who call themselves Shoupistas even though the market-oriented policies he advocates could best be summed up by the battle cry, "Charge whatever the traffic will bear."


He'd offered to arrange "free (or rather fully subsidized) parking" for me, but I wanted to take the bus in order to experience public transit in Los Angeles . I made it to UCLA 45 minutes early and spent the time checking out the campus, and then went up to his office and found a bald man with a grey beard sitting at a desk that had a radio in the shape of a parking meter on it.


Shoup isn't sure what the ratio of parking spots to cars is – he suspects it's at least three or four to one, probably more – but he knows it's too high. He's also convinced that free parking not only encourages people to drive, it's actually expensive because subsidizing it costs the economy more than the U.S. government devotes to Medicare.


Turning to his computer, he showed me aerial photos of several cities to demonstrate how much land we waste just to give drivers a place to leave their wheels. "Parking is the single-biggest land use in almost any city and almost everybody has ignored it," he told me. "It's like dark matter in the universe: We know there's something there, and it seems to weigh a lot, but we don't know what it is. If only we could get our hands on it."


While he was at his computer, he also gave me a virtual tour of the Old Town Pasadena neighbourhood, with before and after photos that showed how it had gone from skid row to upscale destination.


One of his ideas was instrumental in that transformation. The city faced a common problem: Parking was free, but the few merchants who were still in business complained that it was inadequate. The people who worked in the stores took most of the spots, leaving customers to drive around searching for one – or just staying away. Meanwhile, the city had a vision of a revitalized downtown but no money to repair sidewalks, plant trees, increase security or take any of the other steps necessary to attract people.


Shoup recommended charging enough for parking to maintain an 85 per cent occupancy rate and using the money shoppers dropped in the meters to improve the neighbourhood. The revenue couldn't go into the city's general coffers; it had to be spent on the streets.


Once that happened, the business community started to invest, too – even sandblasting and renovating derelict buildings – and soon the shop owners, who had initially opposed meters, wanted to charge for parking until midnight. They wanted the money for the improvements, but they also discovered that their fears about scaring away customers were unfounded – anyone who really wanted to shop or eat in the area was willing to invest a few quarters.


As the area became more popular, the meters raised more money for more improvements, which increased the popularity. And so on. The city now collects one million dollars a year to pay for upkeep that includes sweeping the sidewalks nightly and steam-cleaning them twice a month.


In Calvin Trillin's Tepper Isn't Going Out, a slight but charming novel about a man who becomes a New York folk hero because of his parking acumen, once Murray Tepper finds a parking spot, he just sits there and enjoys it. But when Shoup and I talked about the book, he pointed out that Tepper wouldn't have stayed put so long if Manhattan charged the right price for street parking. The right price is the one that means there are always one or two open spots per block. Since the cost encourages turnover, time limits are unnecessary; in fact, any place that needs to impose time limits is not charging enough.


A city should adjust the rate every quarter to ensure the 15 per cent vacancy rate, always letting the market decide the price. "Nobody can tell you what the right price of gold is, or the right price of wheat or apples," he argued. "It just happens."


Free off-street parking isn't something that just happens, though, because planning departments always insist that developers include a minimum number of parking spots. Shoup doesn't have much respect for the ability of urban planners to determine how many spots are necessary. Since planners don't learn anything about parking in school, they learn it on the job, but because parking is so political – NIMBY neighbours constantly squawk at the thought of anyone parking on their street – what they really learn is the politics of parking.


"Planning will be looked back on as worse than phrenology, because phrenology didn't do any harm," he said, referring to the nineteenth-century pseudoscience that claimed to be able to determine character and other traits from the size and shape of a cranium.


The harm abundant free parking does feeds on itself: All that land dedicated to parking, which often sits empty for much of the day, increases sprawl, and that sprawl makes alternatives such as public transit and walking less feasible, which forces more people into cars, which increases the need for more parking.


Again, Shoup argued that the market should decide: Freed from the arbitrary and capricious demands of the planners, developers will put in the right amount of parking – enough to meet their customers' needs, but not so much that they waste valuable space or money.


When the Westfield San Francisco Centre reopened in September 2006 after a major renovation, it was triple the size, featured high-profile tenants such as Bloomingdale's and expected 25 million visitors a year – all without adding any new parking. A lot of people shook their heads at that, but the mall is close to 32 transit lines and sits across the street from a large parking garage that was rarely anywhere close to full.


In 1992, the state of California adopted another Shoupism: Under the parking cash-out law, companies that pay for employees' parking must offer the equivalent in cash to nonparkers. So someone who works for a firm that pays $150 a month for each spot in an underground lot can opt to forgo the spot and pocket the cash. After the law came in, 13 per cent of employees took the money – most switching to car pools or taking public transit, though a few started riding a bike or walking to work.


Although his ideas seem like so much common sense, Shoup still feels they're underappreciated. Many places want to thrive the way Old Town Pasadena has, but few realize how crucial the meter money was to that success.


Still, he knows some planners are curious because he receives more invitations to speak than he can accept. Cities pay him large lecture fees, fly him first class and then wine him and dine him, but they don't all do what he suggests because parking is so political.


"All I can do is go and say, 'You're doing everything wrong,' " said Shoup, who rides a bike about three kilometres to campus, puts just 5,600 kilometres a year on his Infiniti, and admitted that he's often mistaken as an enemy of the car. He insists he's not; it's just that people would live differently – read: drive less – if they had to pay for parking.


The good news is that all that parking space is an accidental land reserve for housing that can bring in tax revenue even as it helps ease traffic congestion, air pollution and energy dependence.

"The nice thing is that when cities adopt what I'm saying" – he snapped his fingers – "like that, it works."



Evening and Weekend Parking Pricing (SFMTA 2009)

The City of San Francisco evaluated the benefits of costs of extending on-street parking pricing to evenings and weekends. It found:


As a result of this analysis city planners developed specific recommendations for expanding the hours of priced parking and improve user convenience, including improved marketing of Parking Cards, extended enforcement hours in residential areas adjacent to commercial streets to reduce potential parking spillover problems, adjust meter hours, prices and regulations to achieve 85% occupancy rate targets, and reduce hourly rates in public parking lots to attract motorists from on-street parking.



Aspen Downtown and Residential Neighborhood Parking Pricing (

Aspen, Colorado is a rapidly growing resort community. In 1991 the city built a 340-space underground parking structure in the city center, but despite its convenient location and low price it remained half-empty most days, while on-street parking was congested. Many spaces were occupied by locals and downtown commuters who performed the “ninty minute shuffle,” moving their cars every 90 minutes to avoid a parking ticket.


In 1995 the city began charging for on-street parking using multi-space meters. Parking fees are highest in the center and decline with distance from the core. The city had a marketing campaign to let motorists know about the meters, including distribution of one free $20 prepaid parking meter card to each resident to help familiarize them with the system. Each motorist was allowed one free parking violation, and parking control officers provide an hour of free parking to drivers who were confused by the meters. Although some downtown workers initially protested (opponents organized a “Honk if you hate paid parking” campaign the day pricing began), pricing proved effective at reducing parking problems and six months later the program was supported in a municipal election by a 3-to-1 margin. Most downtown business people now support pricing to insure that convenient parking is available for customers and help finance city programs.


In Aspen’s residential parking permit (RPP) zones, residents may obtain free parking permit for up to two personal vehicles, plus a guest parking pass. Non-residents may park for up to two hours free, or purchase an all day permit for $7.00. Businesses holding a valid City of Aspen business license located in the residential area receive one permit at no charge, and may purchase additional parking permits for $1,000 per year.



Austin Parking Benefit District (

Many neighborhood experience various parking spillover problems, including difficulty finding parking for residents and their visitors, concerns that public service vehicles cannot pass two lanes of parked vehicles on the street, or that parking on the street reduces neighborhood attractiveness.


These problems become an opportunity with the establishment of a Parking Benefit District (PBD) A PBD is created by metering the on-street parking (either with pay stations on the periphery of the neighborhood or with the traditional parking meters) and dedicating the revenue, less City expenses for maintenance and enforcement, towards improvements in the neighborhood that promote walking, cycling and transit use, such as sidewalks, curb ramps, and bicycle lanes. In addition, to encourage drivers to consider other ways to reach their destination without driving and parking in the neighborhood, parking meters will inform drivers of alternative ways to reach their destination. Charging for parking and promoting alternatives should help reduce the number of people parking in the neighborhood, but for those that do park and pay the meter, the neighborhood benefits. The PMD may be used in conjunction with a Residential Permit Parking program to ensure that parking is available for residents and their visitors.


The Parking Benefit District pilot program is funded in part by a grant from the Mobile Source Outreach Assistance program of the Environmental Protection Agency, which selects public education and outreach projects that directly support local efforts to improve air quality from mobile sources.


European Parking Management (Kodransky and Hermann 2011)

European cities are reaping the rewards of innovative parking policies, including revitalized town centers; big reductions in car use; drops in air pollution and rising quality of urban life, according to Europe's Parking U-Turn: From Accommodation to Regulation, published by the Institute for Transportation and Development Policy. The report examines European parking over the last half century, through the prism of ten European cities: Amsterdam, Antwerp, Barcelona, Copenhagen, London, Munich, Paris, Stockholm, Strasbourg and Zurich. It found:

·         European cities are ahead of the rest of the world in charging rational prices for on-street parking. In Paris, the on-street parking supply has been reduced by more than 9% since 2003, and of the remaining stock, 95% is paid parking. The result, along with other transport infrastructure improvements, has been a 13% decrease in driving.

·         Parking reforms are becoming more popular than congestion charging. While London, Stockholm, and a few other European cities have managed to implement congestion charging, more are turning to parking. Parking caps have been set in Zurich and Hamburg's business districts to freeze the existing supply, where access to public transport is easiest.

·         Revenue gathered from parking tariffs is being invested to support other mobility needs. In Barcelona, 100% of revenue goes to operate Bicing—the city's public bike system. Several boroughs in London use parking revenue to subsidize transit passes for seniors and the disabled, who ride public transit for free.

·         Parking is increasingly linked to public transport. Amsterdam, Paris, Zurich and Strasbourg limit how much parking is allowed in new developments based on how far it is to walk to a bus, tram or metro stop. Zurich has made significant investments in new tram and bus lines while making parking more expensive and less convenient. As a result, between 2000 and 2005, the share of public transit use went up by 7%, while the share of cars in traffic declined by 6%.


Ventura Council OKs Parking-fee System for Downtown

By Anne Kallas, Ventura County Star, 26 January 2010


A divided Ventura City Council has approved spending up to $855,000 for a system to start charging people to park downtown. The council Monday night voted 5-2, with Neal Andrews and Jim Monahan dissenting, to spend up to $755,000 for 65 pay stations and up to an additional $100,000 for a wireless system to allow drivers and parking officers to access the system remotely.


The council has been working on a downtown parking plan since 2007, according to Mayor Bill Fulton, who said Monday’s decision was “merely executing an action that we have voted on several times over the past few years.”


Andrews, however, questioned what he said were changes in what was originally approved, citing an increase in money to fund the project and an expansion of hours for parking fee enforcement.


City Transportation Manager Tom Mericle said that among about 3,800 parking spaces downtown, only 411 will require payment, with 280 of them on Main Street between Ash Street and the San Buenaventura Mission. Side streets in that area will also require payment between Poli and Santa Clara streets. Some streets will have permits available for residents who live in the area.


Mericle said the initial parking fee will be $1 per hour for the first two hours and $1.50 for each hour afterward, which will be paid at the stations by coin or credit/debit card.

Monahan said he was concerned about a provision where people having special events, such as the annual St. Patrick’s Day parade, would have to pay to make up for lost parking revenue. He was assured that city-sponsored events would be exempt but said he still couldn’t support paid parking. He cited two previous, failed installations of downtown parking meters. “This is the third time we’ve put them in, and I know they will be taking them out in a few years,” Monahan said.


Andrews said that with many area restaurants struggling in today’s economy, adding another cost to dining out downtown was irresponsible. He was also critical of the motivations behind the program, saying the city was not being up front about a goal to raise money and not just manage parking.


But Councilman Mike Tracy, a former Ventura police chief, lauded the plan as “long overdue” and said the city needs to better manage parking downtown. Council members Christy Weir, Carl Morehouse and Brian Brennan also supported the move, as did Fulton.

Mericle said the system, which likely will be rolled out in April, allows for flexible pricing. The city can change the hours and fees if people don’t use the paid parking spaces. In addition, he said, parking in city lots will remain free, at least for the time being.


Parking Management That Actually Manages Parking

By Bill Fulton, Ventura Mayor (


At about 10:30 this morning, I step out of my office at the corner of Poli and Oak and walk down Oak Street to get a cup of coffee at Palermo. Almost immediately, I notice something different. The parking lot on Oak Street, usually two-thirds empty in the morning, is mostly full. And the on-street parking spaces along Oak and Main Street, which are mostly occupied on a typical morning at this time, are mostly vacant.

It takes me a moment before I realized why: The paid parking portion of our downtown parking management program had gone into effect at 10 a.m., and it was already showing results. People who park all day downtown have moved into the lots and the upper levels of the parking garage. Spaces on the street are now available for shoppers, diners, and others who were running short-term errands. In other words, only 30 minutes after we instituted the parking management program, it is working.

In all the discussions around town this summer about paid parking, the emphasis has always been on the "paid" part. Why is the city charging for parking downtown? Are we just being greedy? Where will the money go? Why would anyone go downtown if they have to pay to park?

These are all fair questions. (And they all have good answers -- for example, all the parking revenue money is going to benefit downtown and not being spent elsewhere in the city.) But the questions have obscured an important goal of the paid parking, which has nothing to do with revenue. The goal is to encourage employees and other long-term parkers downtown in order to free up space on the street for shoppers. And I was stunned at how quickly our "parking management" goal was achieved.

All day, we have a dozen or so police officers, public works officials, police cadets, and police volunteers downtown assisting people. When I go out again at lunchtime, the street spaces are beginning to fill up -- and everywhere I look, somebody from the city is helping a downtown shopper figure out how to use the new machines. But the point is still clear: The on-street spaces are gradually filling up with people who had come downtown to shop.

In the months leading up to the inauguration of paid parking, I kept hearing stories about how downtown employees were hogging the on-street spaces. I heard that some merchants told their employees to park on the street -- but a block away, so as not to take up parking in front of the store. I heard that some businesses and employees erase the chalk marks that our parking enforcement folks put on their tires. I heard that some business owners give their employees a few minutes off every two hours to move their cars.

Frankly, I wasn't sure if I believed all these stories. After all, why would any merchant park in front of their own store? Why would you deal with all the hassles to park on the street -- erasing chalk, moving cars -- when there's free parking in city lots a half-block away? It seemed ridiculous to me. But the lesson from today is that it's not ridiculous. Obviously, what's been happening is that employees have been parking on the street and now they are parking in the lots.

At about 3 pm, I decide it is time for another cup of coffee at Palermo, partly just to see what was going on. By now most of the on-street spaces are taken -- but the police volunteers and cadets are still around. A woman wanders past Palermo and asks me if I know how to use the machines. I start to help her (she seems tickled pink that the mayor is helping her) when a fresh-faced police cadet comes up and does a better job of explaining it.

Anybody's first impulse, I think, is that paying for parking is a bad thing. But upon reflection, a lot of folks -- merchants and shoppers alike -- have come around to the idea that it can be a good thing.

Some shoppers have complained over the past few months that parking at the mall is free, so why should they pay to park downtown? The answer -- provided by Downtown Ventura Organization board chair Dave Armstrong -- is that you're paying for access to a few hundred premium spaces. And he's right. After all, all the mall parking spaces are far away from the stores -- farther than even the most remote free lot downtown. If it was possible to drive right inside the mall and park in front of your favorite store, don't you think the mall would charge for that space? And don't you think some people who think it's worth it would pay the price? Obviously, the answer to both these questions is yes.

Similarly, Main Street merchants have come to see that paid parking can help them too by opening up short-term spaces close to their store. As the owner of Jersey Mike's told me today, her customers used to have to circle the block three times looking for a space or park in a faraway parking lot. Now they can park right in front of her shop for a quarter -- or a dime -- or a nickel -- while they pick up their order. Because even though it's $1 for the first hour, you can buy less time with coins. And there's less traffic on the street because there's less "cruising" for a parking space.

6 pm: I head out to one our local establishments. Now it's very busy downtown -- the younger crowd is beginning to head out to downtown -- and the onstreet spaces are still mostly full. Prime time downtown.

Some people who grumbled about this idea pointed to the experience this summer at Ventura Harbor: Paid parking was instituted in the prime lot near the Village on weekends. But, the complainers pointed out, the Harbor ended the program early because they didn't achieve their revenue goals. True enough, but it was a gloomy summer and tourist business was off generally. And what the complainers tend to overlook is the fact that the Harbor actually did meet the parking management goals. Employees and all-day parkers going to the Channel Islands parked elsewhere, freeing up plenty of space for peope shopping at the Village. In that sense, it was a success.

9:15 pm. I take one final swing through downtown. Parking on the street is fairly light now -- especially on California between Santa Clara and Thompson (near the garage) and on other side streets such as Oak. And it's a fairly quiet Tuesday night -- most places. I peek into Anacapa Brewing to talk to owner Danny Saldana -- and, to my amazement, the place is completely full. Danny is happy with the situation and, like many other downtown business owners, says he is providing one-hour parking coupons to his regular customers for free. It's well worth it, he says, to keep them coming.

I walk back up Oak Street toward the office. The spaces on the street are mostly empty. And the parking lot across from office -- usually almost empty by now -- is completely full. Eleven hours later and it's still working.



Performance-Based Parking Pricing (

Redwood City, California, sets performance-based prices to achieve an 85% occupancy rate, and returns the revenue to the metered districts, as outlined in a city ordinance.



Examples Cited by K.T. Analytics (1995)

·         CH2M Hill began charging employees who drive alone $49 per month to park, while carpoolers parked for free and each employee received a $40 monthly travel allowance. Solo driving declined from 89% to 64%.


·         Pacific Northwest Bell charged employees who drive alone $60 per month to park, while offering discounts for carpools. This resulted in only 25% of employees driving alone to work, compared with 80% for other employers in the area.


·         The City of Madison imposed a surcharge of $1 per day at four parking facilities combined with new shuttle services. Five to eight percent of commuters switched to transit as a result.


·         The City of Chicago raised fees at municipal lots 30-120%, bringing them to levels at nearby commercial lots. The number of cars parked declined 35%, with no significant increase in parking at nearby lots.


·         The City of Eugene approximately doubled monthly rates at municipal parking lots from a minimum of $6 to $16 for surface lots and from $16 to $30 for garages. Parking demand declined 35%, about half changing parking locations and the other half switching to public transit or other alternative modes.



Santa Monica To Experiment With Parking Psychology

Consultants find the city doesn't need more spaces, it needs to change how they are used. New pricing model aims to promote walking, biking or busing, freeing up prime spaces for short-term shoppers.

Martha Groves, Los Angeles Times, 14 October 2009 (,0,6335426,print.story).


Embracing a bold experiment to alter human behavior, Santa Monica is poised to raise parking rates on the city's most coveted downtown spots to discourage some motorists from using them.
The idea is to get people out of their cars and end what city leaders deem an ill-advised subsidy for public parking.

By boosting rates, officials intend to make the parking closest to the congested Third Street Promenade expensive enough that some visitors will instead walk, take the bus or park in more-distant garages. If it works, the city would benefit from smoother traffic flow, reduced pollution as fewer people cruise for spaces and a better return on land developed for public parking.

"What we're saying is: 'Parking's not free in Santa Monica anymore,' " said Councilman Bobby Shriver, who advocates changing the parking rules.

Santa Monica is one of several cities -- including Los Angeles, San Francisco and Washington, D.C. -- turning to market-based pricing in an effort to keep parking lots busy with paying customers while making alternatives such as walking, cycling or taking public transit more appealing.


But critics contend the proposed changes might chase customers away, a risky prospect in a city that depends heavily on sales tax dollars. "Because of the economic climate, any reason to choose another place is one too many," said Kathleen Rawson, chief executive of the Bayside District Corp., the public-private partnership that manages the downtown business district.

Proponents of the pricing strategy say the opposite is more likely: higher rates will mean more open parking spots, which would appeal to rushed customers. Moreover, the motorist willing to pay higher rates is probably also willing to spend more in stores or leave bigger tips.

Santa Monica arrived at the market-based pricing idea when consultants hired to evaluate the need for additional downtown parking discovered something unexpected: The city actually had plenty. The problem was that visitors and employees were vying for the most convenient spots as hundreds or thousands of other outlying or privately owned spaces sat empty.

"We don't really need more parking downtown," said Santa Monica Mayor Ken Genser. "It's the way the parking is being used that's a problem."

The study found that downtown employees were parking and reparking in structures on 2nd and 4th streets near the promenade to take advantage of the two-hours-free policy, taking away spaces from potential customers. To Shriver, the study's key revelation was that municipal structures had essentially become subsidized parking for private-sector employees.

"The city policy in its public structures can't be that everybody who works on the promenade gets a free space," he said.

Santa Monica workers and residents have mixed views.

Anne Troutman, an architect who lives near the shops and restaurants, sees higher parking fees "as a necessary and gentle step . . . along the path toward reducing our dependence on cars." But she worries about the elderly volunteers at places such as the Santa Monica Bay Woman's Club, for whom even a small increase might prove a hardship.

Hilary Kenny, a bartender who uses the municipal garages, said the current two-hours-free policy is a big selling point for visitors. Higher rates, she said, would "discourage people who want to pop in to have a drink or go to a movie." However, she said $1 for the second hour would be "not so bad."

The consultants recommended the city rebuild and expand two existing structures near the promenade but forgo building 1,000 new spaces. The city had projected that new or replacement spaces would cost about $57,000 each.

"It's shockingly expensive," said Steffen Turoff of Walker Parking Consultants, which prepared the Santa Monica report. "From an environmental and financial perspective, it's a waste to build more when so many spaces in this area sit empty even during the busiest times of the week."

Cities indeed pay dearly to create and maintain free or inexpensive parking and devote a tremendous amount of land to it. Parking experts say the cost of building above-ground parking can range from $15,000 to $30,000 per space. Subterranean spaces can cost $25,000 to $70,000 each.

"We grow up thinking that somebody else should pay for parking," said Donald Shoup, a Yale-trained economist and UCLA urban planning professor who wrote "The High Cost of Free Parking," considered by many the definitive text on the subject. "The cost doesn't go away just because the driver doesn't pay for it."

Ideally, Shoup contends, a city would charge enough so that 85% of all parking spaces were occupied at any one time. If too many spaces are vacant, the price is too high. If no spaces are available, the price is too low.

Once Santa Monica city staff recommend a plan, perhaps by late this year, the City Council is expected to raise daily and nighttime rates and monthly parking fees and charge a dollar for the second hour of parking in garages. A full day of parking would rise from $7 to $9 and on-street parking meters from $1 to $1.50 per hour. Meters might be converted to accept credit cards.

Parking rates in downtown Los Angeles are generally higher. Meters in the most congested areas run $4 an hour, comparable to off-street parking; some other meters near the central districts cost $2 an hour. Most meters, however, are $1 an hour. Municipal lots vary, from a $4 flat rate to $6 per hour.

Under an agreement with the Bayside District Corp., the city also will explore a comprehensive program to make better use of private parking lots, a centralized valet system, public-transit incentives and shuttles to and from outlying garages. Rates at the newer Main Library and Civic Center lots might be reduced.

Santa Monica's discussion reflects a vexing reality -- that parking has an "unbelievable power . . . to shape and distort cities," said Ventura City Manager Rick Cole. "It's illegal for a car to be homeless but not for people," he said. "As a result, we devote a huge amount of extraordinarily valuable real estate to asphalt and concrete and then we give it away."

Ventura, which does not charge for street parking, plans to install meters in January, three years after it first committed to market-based pricing. "You have to break the initial barrier of charging for parking," Cole said of the delay.

He speaks from experience. As mayor of Pasadena in the early 1990s, he helped broker a deal with Old Pasadena retailers that paved the way for paid parking. All the meter revenue went into area amenities, which strengthened demand, turning Old Pasadena into a municipal cash cow.

Turoff, the consultant who managed the Santa Monica project, said it comes down to simple tradeoffs: "Do you want a free space, or do you want to be able to find a space? Are you going to substitute desirable destinations for car storage? You'd lose the attraction, but everybody could park there."



References And Resources For More Information


Apogee (1994), Costs and Cost Effectiveness of Transportation Control Measures; A Review and Analysis of the Literature, National Association of Regional Councils (


Richard Arnott and John Rowse (2007), ‘Downtown Parking in Auto City’, Boston College Working Paper 665 (; at


Amy H. Auchincloss, Rachel Weinberger, Semra Aytur, Alexa Namba and Andrew Ricchezza (2014), “Public Parking Fees And Fines: A Survey Of US Cities,” Public Works Management & Policy, http://pwm.Sagepub.Com/content/early/2014/02/19/1087724x13514380.


Paul Barter (2010), Parking Policy in Asian Cities, Asian Development Bank (; at Also see


Booz Allen Hamilton (2006), International Approaches to Tackling Transport Congestion: Paper 2: Parking Restraint Measures, Victorian Competition and Efficiency Commission (


BTS (1992), Summary of Travel Trends; 1990 National Personal Transportation Survey, Bureau of Transportation Statistics, USDOT (


Colliers (2009), CBD Parking Rate Survey, Colliers International (; at


Comsis Corporation (1993), Implementing Effective Travel Demand Management Measures: Inventory of Measures and Synthesis of Experience, USDOT and Institute of Transportation Engineers (; available at


Sisinnio Concas and Nagesh Nayak (2012), A Meta-Analysis of Parking Price Elasticity, presented at the Transportation Research Board Annual Meeting (


CORDIS (2001), Parking Policy Measures and their Effects on Mobility and the Economy, COST 342, CORDIS (


CROW (1994), publication 79 Rotondes, Centre for Research and Contract Standardisation in Civil and Traffic Engineering (, The Netherlands.


Luca D'Acierno, Mariano Gallo and Bruno Montella (2006), “Optimisation Models For The Urban Parking Pricing Problem,” Transport Policy, Vol. 13, pp. 34-48.


Mark Delucchi and James Murphy (1998), Motor-Vehicle Goods and Services Bundled in the Private Sector, Report #6 in the Series “The Annualized Social Cost of Motor-Vehicle Use in the United States, Based on 1990-1991 Data,” Institute of Transportation Studies, University of California at Davis (


Stuart Donovan (2011), Convenient, Affordable Parking When And Where You Need It: The Benefits Of Accurate Pricing and Smart Technologies, Frontier Centre For Public Policy (;


John Dorsett (1998), “The Price Tag of Parking,” Urban Land, May 1998, pp. 66-70.


DTF (2010), Review of the Effectiveness of the Congestion Levy, Victoria Department of Treasury and Finance (; at$File/CongestionLevy2010.pdf


Marcus Enoch and Stephen Ison (2006), “Levying Charges On Private Parking: Lessons From Existing Practice,” World Transport Policy & Practice, Vol. 12, No. 1 (, pp. 5-14.


FHWA (2012), Contemporary Approaches to Parking Pricing: A Primer, Office of Operations (, U.S. Federal Highway Administration; at


Lawrence D. Frank, et al. (2011), An Assessment of Urban Form and Pedestrian and Transit Improvements as an Integrated GHG Reduction Strategy, Washington State Department of Transportation (; at


Martha Groves (2009), “Santa Monica To Experiment With Parking Psychology: Consultants Find The City Doesn't Need More Spaces, It Needs To Change How They Are Used. New Pricing Model Aims To Promote Walking, Biking Or Busing, Freeing Up Prime Spaces For Short-Term Shoppers,” Los Angeles Times, 14 October 2009 (,0,6335426,print.story).


Bern Grush (2014), “A Tale Of Too Many Cities: Downtown Merchants Demand Free Parking,” Parker (, pp. 8-9; at


Greig Harvey and Elizabeth Deakin (1997), “The STEP Analysis Package: Description and Application Examples,” Appendix B, in Apogee Research, Guidance on the Use of Market Mechanisms to Reduce Transportation Emissions, USEPA (Washington DC;


David Hensher and Jenny King (2001), “Parking Demand and Response to Supply, Pricing and Location in Sydney Central Business District,” Transportation Research A, Vol. 35, No. 3, March 2001, pp. 177-196.


Daniel B. Hess (2001), “Effects of Free Parking on Commuter Mode Choice: Evidence from Travel Diary Data,” Transportation Research Record: Journal of the Transportation Research Board No. 1753, TRB (, pp. 35-42; at Lewis Center for Public Policy Studies, UCLA (


Angus Hulme-Moir (2010), Making Way for the Car: Minimum Parking Requirements and Porirua City Centre, Thesis, School of Geography, Environment and Earth Sciences, Victoria University of Wellington (


ICF (1997), Guidance on the Use of Market Mechanisms to Reduce Transportation Emissions, USEPA (


IPI, International Parking Institute ( provides information for parking management professionals.


ITDP (2012), Manual De Implementación De Sistemas De Parquímetros Para Ciudades Mexicanas (Parking Meter System Deployment Manual for Mexican Cities), Institute for Transportation and Development Policy, Mexico City office (; at


K.T. Analytics (1995), Parking Management Strategies: A Handbook For Implementation, Regional Transportation Authority (Chicago), 1995; available as FTA, TDM Status Report: Parking Supply Management and TDM Status Report: Parking Pricing, Federal Transit Administration (


King County (2011), Right Size Parking Project (


Ruth Knack (2005), “Pay As You Park,” Planning (, May.


Michael Kodama (2010), “Charge for Parking: A Major Policy Step for Glendale, CA,” Parking Today (, January, pp. 24-28.


Douglas Kolozsvari and Donald Shoup (2003), “Turning Small Change Into Big Changes,” ACCESS 23, University of California Transportation Center (, Fall 2003, pp. 2-7; at


Michael Kodransky and Gabrielle Hermann (2011), Europe’s Parking U-Turn: From Accommodation to Regulation, Institute for Transportation and Development Policy (; at


Arun R. Kuppam, Ram M. Pendyala, and Mohan A. V. Gollakoti (1998), “Stated Response Analysis of the Effectiveness of Parking Pricing Strategies for Transportation Control,” Transportation Research Record 1649, TRB (, pp. 39-46.


Richard J. Kuzmyak, Rachel Weinberger and Richard H. Pratt (2003), Parking Management and Supply: Traveler Response to Transport System Changes, Chapter 18, Report 95, Transit Cooperative Research Program; TRB (;


Todd Litman (2004), Parking Requirement Impacts on Housing Affordability, VTPI (; at


Todd Litman (2006a), Parking Management Best Practices, Planners Press (;


Todd Litman (2006b), Parking Management: Strategies, Evaluation and Planning, Victoria Transport Policy Institute (


Todd Litman (2006c), Parking Taxes: Evaluating Options and Impacts, VTPI (


Todd Litman (2006d), Parking Management: Innovative Solutions To Vehicle Parking Problems, Planetzen (


Todd Litman (2007), Pavement Busters Guide, VTPI (; at


Todd Litman (2008), Transportation Elasticities: How Prices and Other Factors Affect Travel Behavior, Victoria Transport Policy Institute (; at


Todd Litman (2009), “Parking Costs,” Transportation Cost and Benefit Analysis: Techniques, Estimates and Implications, Victoria Transport Policy Institute (; at


Todd Litman (2010), Parking Pricing Implementation Guidelines: How More Efficient Pricing Can Help Solve Parking Problems, Increase Revenue, And Achieve Other Planning Objectives, Victoria Transport Policy Institute (; at


Todd Litman (2012), “Changing North American Vehicle-Travel Price Sensitivities: Implications For Transport and Energy Policy,” Transport Policy, (; full report at


Todd Litman, Daniel Carlson, Aaron Blumenthal and John Lee (2010), Evaluating Seattle Parking Tax Options, Victoria Transport Policy Institute ( and the Washington State Transportation Center at the University of Washington (; at


LLREI (2000), Emerging Trends in Real Estate 2001, Lend Lease Real Estate Investments (


Mary Marr (1999), Downtown Parking Made Easy, Downtown Research and Development Center (


Gerard Mildner, James Strathman and Martha Bianco (1997), “Parking Policies and Commuting Behavior,” Transportation Quarterly, Vol. 51, No. 1, Winter 1997, pp. 111-125.


John Morrall and Dan Bolger (1996), “The Relationship Between Downtown Parking Supply and Transit Use,” ITE Journal, February 1996, pp. 32-36.


MRSC (2005), Downtown Parking Solutions, Municipal Research and Service Center of Washington (


MTC (2007), Developing Parking Policies to Support Smart Growth in Local Jurisdictions: Best Practices, Metropolitan Transportation Commission (; at


NPA (2009), Parking In America, The National Parking Association’s First Annual Review of Parking Rates in the United States and Canada, National Parking Association (; at


Parking Reform Website ( promotes various reforms, particularly parking pricing with revenues returned to local communities and businesses.


Richard H. Pratt (1999), Traveler Response to Transportation System Changes, Interim Handbook, TCRP Web Document 12 (, DOT-FH-11-9579.


PT (2000), “What is the Average Price to Park in Major U.S. Metropolitan Areas,” Parking Today (, October 2000.


PT (2001), “San Francisco May Require High-Tech Equipment on Surface Honor Lots,” Parking Today (, March 2001, p. 31-32. 


Parking Today Website ( has information and links to parking resources.


Rick Williams Consulting (2006), Lloyd District Regional Center Plan and Progress, Washington State Department of Transportation (; at


Gabriel Roth (1965), Paying for Parking, Hobart Paper 33 (London); available at the Victoria Transport Policy Institute website:


Gary Roth (2004), An Investigation Into Rational Pricing For Curbside Parking: What Will Be The Effects Of Higher Curbside Parking Prices In Manhattan? Masters Thesis, Columbia University; at


Tom Rye and Stephen Ison (2005), “Overcoming Barriers to the Implementation of Car Parking Charges at UK Workplaces,” Transport Policy, Vol. 12, No. 1 (, Jan. 2005, pp. 57-64.


Andrés Sañudo, Xavier Treviño, Jimena Veloz and Salvador Medina (2013), "Impacts of the ecoParq program on Polanco," Institute for Transportation and Development Policy (; at


SF (2008), Parking Pilot Projects: Urban Partnership Program, Municipal Transportation Agency, San Francisco (; at


SF (2009), On-Street Parking Management and Pricing Study, San Francisco County Transportation Authority (; at


SFMTA (2009), Extended Meter Hours Study, San Francisco Metropolitan Transportation Agency (; at


SFPark (2012), Parking Rates & Policies Survey, City of San Francicsco (; at


Yoram Shiftana (1999), “Responses to Parking Restrictions: Lessons from a Stated Preference Survey in Haifa and Their Policy Implications,” World Transport Policy And Practice (, Vol. 5, No. 4, pp. 30-35.


Donald Shoup (1995), “An Opportunity to Reduce Minimum Parking Requirements,” Journal of the American Planning Association, Vol. 61, No. 1, pp. 14-28.


Donald Shoup (1999), “The Trouble With Minimum Parking Requirements,” Transportation Research A, Vol. 33, No. 7/8, Sept./Nov. 1999, pp. 549-574, also available at VTPI (


Donald Shoup (1999b), “Instead of Free Parking, Access 15 (, Fall 1999, pp. 8-13.


Donald Shoup (2002), Curb Parking: An Ideal Source of Public Revenue, Lincoln Institute of Land Policy (, Presented at “Analysis of Land Markets and the Impact of Land Market Regulation,” (Code CP02A01).


Donald Shoup (2007), “Cruising For Parking,” Access 30, University of California Transportation Center (, Spring 2007, pp. 16-22; at


Donald Shoup (2005), The High Cost of Free Parking, Planners Press ( This is a comprehensive and entertaining book of the causes, costs and problems created by free parking, and how to correct these distortions. Podcast at


Donald Shoup (2005), Parking Cash Out, Report No. 532, APA Planning Advisory Service, Planners Press (


Donald Shoup (2006), The Price of Parking On Great Streets, Planetizen (


Donald Shoup (2008), The Politics and Economics of Parking On Campus, University of California Los Angeles (


Donald Shoup (2011), “Free Parking Or Free Markets,” CATO Unbound (; at; also in, Access 38, University of California Transportation Systems Center (, Spring 2011, pp. 29-35; at


Donald Shoup (2013), “Portland Should Consider Overnight Permits To Solve Its Parking Headache,” Oregonian (; at


Patrick Siegman (2008), Less Traffic, Better Places: A Step-by-Step Guide to Reforming Parking Requirements, San Diego Section of the American Planning Association (; at


Mary Smith (1999), “Parking,” Chapter 14, Transportation Planning Handbook, Institute of Transportation Engineers (


Lawrence Solomon (1995), “On the Street Where You Park: Privatizing Residential Street Parking Will Keep the Lilacs Blooming, the Larks Singing and the Pavement to a Minimum,” The Next City, Vol. 1, No. 2 (, Winter 1995, pp. 58-61; at


Steven Spears, Marlon G. Boarnet and Susan Handy (2010), Draft Policy Brief on the Impacts of Parking Pricing Based on a Review of the Empirical Literature, for Research on Impacts of Transportation and Land Use-Related Policies, California Air Resources Board (


SPECTRUM (2005), Review of Specific Urban Transport Measures in Managing Capacity, SPECTRUM (Study of Policies regarding Economic instruments Complementing Transport Regulation and the Undertaking of physical Measures) (


Ruth Steiner, et al. (2012), Impact of Parking Supply and Demand Management on Central Business District (CBD) Traffic Congestion, Transit Performance and Sustainable Land Use, Florida Department of Transportation Research Center (; at


TLC (2003), The Myth of Free Parking, Transit for Livable Communities (


USEPA (1998), Parking Pricing, Transportation and Air Quality TCM Technical Overviews, US Environmental Protection Agency (


USEPA (2006), Parking Spaces / Community Places: Finding the Balance Through Smart Growth Solutions, Development, Community, and Environment Division (DCED); U.S. Environmental Protection Agency (


Erin Vaca and J. Richard Kuzmyak (2005), Parking Pricing and Fees, Chapter 13, TCRP Report 95, Transit Cooperative Research Program, Transportation Research Board, Federal Transit Administration (


VTPI (2003), Parking Cost, Pricing And Revenue Calculator, Victoria Transport Policy Institute (


Rachel Weinberger, John Kaehny and Matthew Rufo (2009), U.S. Parking Policies: An Overview of Management Strategies, Institute for Transportation and Development Policy (; at


Richard Willson (1997), “Parking Pricing Without Tears: Trip Reduction Programs,” Transportation Quarterly, Vol. 51, No. 1, Winter 1997, pp. 79-90.


Philip Winters and Daniel Rudge (1995), Commute Alternatives Educational Outreach, National Urban Transit Institute, Center for Urban Transportation Research (Tampa;


Robin Zimbler (2005), Driving Urban Environments: Smart Growth Parking Best Practices, Maryland Governor’s Office of Smart Growth (

This Encyclopedia is produced by the Victoria Transport Policy Institute to help improve understanding of Transportation Demand Management. It is an ongoing project. Please send us your comments and suggestions for improvement.




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