THE HIGH COST OF FREE PARKING

Donald Shoup

VEHICLE OWNERSHIP RATES:THE UNITED STATES FROM 1900 TO 1996 AND 15 OTHER COUNTRIES IN 1996
(Motor vehicles per 1,000 persons) 800
1996

750 700 650

Vehicle ownership rates in 15 countries in 1996

(Each country is placed beside the year in which the US had the same ownership rate.)
1980 1985

1990

1975

600 Australia (583)

MOTOR VEHICLES PER 1,000 PERSONS

550 500

Japan (547) France (526) United Kingdom (486)

1970

450 400 350 300 250 200 150 Mexico (125) 100 Russia (80) 50 China (9) 1915 0 1900 1910 South Korea (208) Argentina (170)

Spain (457)
1960 1955

1965

Denmark (397)

Ireland (343) Greece (310) Israel (266)

1940 1930 1925 1945 1935 1950

Vehicle ownership rates in the United States from 1900 to 1996

1920

1920

1930

1940

1950

1960

1970

1980

1990

2000

YEAR

All transportation systems have three basic elements:

Vehicles
Trains Airplanes Ships Cars

Rights of way
Train tracks Sky Oceans Roads

Terminal capacity
Train stations Airports Seaports Parking spaces

Automobile travel is unusual in two ways:

It requires enormous terminal capacity (several parking spaces per car).
The cost of parking has been shifted out of the transportation sector and into the prices for everything else. Drivers park free for 99 percent of automobile trips in the US.

Who pays for free parking?

Everyone but the motorist.

TABLE 7-4 ANNUAL CAPITAL AND OPERATING COST OF PARKING AND ROADS ($billions per year in 1990-1991) Low High Bundled non-residential parking Bundled residential parking Munic ipal and institutional parking Priced parking Total cost of park ing Total park ing subsidy Total cos t of roads Parking cost as % of road cost $49 $15 $12 $3 $79 $76 $98 81% $162 $41 $20 $3 $226 $223 1% $177 128%

Priced parking as % of total parking 4%

Source (Delucchi 1 997, Tables 1-5, 1-6, and 1-7)

In 2002, the total subsidy for off-street parking was between $135 billion and $386 billion. In 2002, the federal government spent $231 billion for Medicare, and $349 billion for national defense.

Results of changing the price of off-street parking

Employer-Paid Parking
95% of all automobile commuters park free at work 91% of all commuters drive to work 91% of commuters cars have one occupant Most commuters park free regardless of
age gender income education residence

85 million free parking spaces at work in 1994 Parking subsidy for commuters was $36 billion a year

Employer-Paid Parking: A Matching Grant

Employers pay for parking at work if the employee is willing to pay for driving to work Commuters who do not drive to work do not get a subsidy Employer-paid parking encourages solo driving

Free parking increases solo driving by 60%

S o lo d r iv e r s h a r e

100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Driver-paid parking Employer-paid parking 42%

67%

Parking Prices Affect Mode Choices

For Commuters to Downtown Los Angeles

C o m m u te r m o d e s h a r e

80% 70% 60% 50%

Drive solo Transit

40% 30% 20% 10% 0%

Carpool

$0

$1

$2 $3 $4 $5 P rice of parking at work ($/day)

$6

Source: E stimated from W illson (1991)

Californias Parking Cash Out Law

Employers must provide a cash allowance to an employee equivalent to any parking subsidy offered The requirement applies to:
Firms with 50 or more employees Only for leased parking spaces

Commuter Mode Share Before and After Parking Cash Out

C o m m u te r m o d e s h a re
100%

80%

76%
63%

60%

Before cash out

After cash out

40%
23%

20%

14% 6% 9% 2%

3%

0% Solo Driver Carpool Transit Commuter mode choice Walk

.8% .9%

Bicycle

Results
Parking cash out reduced the number of cars driven to work by 11% After parking cash out, employees
traveled 652 fewer vehicle miles per year consumed fewer 26 gallons of fuel per year

Results of increasing the price of curb parking

P ric e o f o f f-s tre e t p a rk in g ($ /h o u r)

FIGURE 13-1 PRICES OF CURB AND OFF-STREET PARKING IN SOUTHERN CALIFORNIA

(for parking one hour at noon on a weekday)

$11 $10 $9 $8 $7 $6 $5 $4 $3 $2 $1 $0 $0 $1 $2 $3 $4 $5 $6 $7 $8 $9 $10 $11

Chinese Theatre, Music Center, SCAG Santa Monica Pier, UCLA, Biltmore Hotel Reagan Building MGM Plaza Union Station, LA MTA, Pasadena City Hall, Coliseum,USC House of Blues

Venice Beach, County Museum SM City Hall LA City Hall

Long Beach City Hall

Pasadena Playhouse

Price of curb parking ($/hour)

P r i c e o f o f f - s t r e e t p a r k in g ( $ / h o u r )

FIGURE 13-2 PRICES OF CURB AND OFF-STREET PARKING

(for parking one hour at noon at city hall on a weekday)
New York City Chicago

$15 $14 $13 $12 $11 $10 $9 $8 $7 $6 $5 $4 $3 $2 $1 $0

Boston

Seattle

Pasadena, San Diego, Baltimore Santa Barbara Cambridge, Santa Monica Los Angeles Buffalo, Philadelphia Long Beach San Francisco, Portland Palo Alto, Berkeley

$0 $1 $2 $3 $4 $5 $6 $7 $8 $9 $10 $11 $12 $13 $14 $15

Price of curb parking ($/hour)

TABLE 11-4 SUMMARY OF RESEARCH ON CRUISING Share of traffic cruising

(percent)

Year 1927 1927 1960 1965 1965 1965 1977 1984 1985 1993 1993 1993 1997 2001 Average

Location Detroit (1) Detroit (2) New Haven London (1) London (2) London (3) Freiburg Jerusalem Cambridge New York (1) New York (2) New York (3) San Franc isc o Sydney

Average search time

(minutes)

19% 34% 17% 6.1 3.5 3.6 6.0 9.0 30% 8% 11.5 7.9 10.2 13.9 6.5 6.5 30% 7.7

74%

P a r k - a n d - v is it tim e ( m in u te s )

Park-and-visit times before and after changing the price of curb parking in London
12.7

14 12 10

Before

After
9.8

8.1 8 6 4.4 4 2 0 5.1

Quadruple

Double Curb parking prices

No change

P a rk -a n d -v is it tim e s (m in u te s )

Park-and-visit times before and after R parking prices were quadrupled

e
12.7

14 12

Before

After

10 8 6 4 2.9 1.0 2 0 6.0 4.4

0.6

0.

Searching

Parking Walking Total Components of park-and-visit times

The effects of parking prices on Grosvenor Square in London

No meters

Meters

Prices quadrupled

Conclusion
Parking is heavily subsidized. The annual subsidy for off-street parking may be about the size of the budget for national defense.
Parking prices have a profound effect on travel choices. Parking subsidies substantially increase vehicle travel.