Parking Pricing charges drivers for using parking facilities. Pricing may be implemented as a Transportation Demand Management strategy (to reduce vehicle traffic), as a Parking Management strategy (to reduce parking problems), to recover parking facility costs, or to generate revenue for other purposes (such as a parking or business improvement district).
Benefits & Problems Addressed
Optimizing parking space availability: Variable rate on-street pricing sets parking rates that fluctuate with demand, which helps optimize parking availability.
Lower housing costs with unbundled parking costs: Spaces are leased or sold separately from the rent or sale price giving incentive to drive less, own fewer cars, or increase transit commuting.
Employee benefits with parking cash-out: Instead of parking perks, cash-out allows an employer to charge for parking but give employees a bonus to offset the cost. Employees may use the bonus to pay for parking or choose an alternative mode and save the difference.
Revenue: Parking meter (or app) revenue is best directed back to the district to improve local streetscapes, economic development, alternative transportation and parking. Some cities create Parking Benefit Districts to plan and manage revenue.
Tips & Techniques
Candidate areas for parking pricing: Cost-based strategies have the most impact where land values are high and where alternatives are readily available - previously hidden costs will be higher, increasing the switch to carpooling, transit, walking, or cycling. Parking Cash-Out is most effective where significant numbers of employers provide free parking, there is little or no on-street parking, and there is good transit service oriented to commuting hours.
Static versus dynamic pricing: Static pricing sets one rate per time increment no matter the demand or time of day. Dynamic (or performance-based) pricing introduces different rates depending on demand. Technology enables real time information to automatically adjust pricing.
Determining parking prices: Parking pricing sets to recover the full cost of parking facilities typically reduces parking demand 10-30%, while commuter time variable-rates (higher during peak periods) is particularly effective at reducing peak use.
Determining time and timing: Parking is often leased by the month and encourages motorists to drive in order to get their money’s worth. It is more efficient to rent parking in smaller time blocks (hourly or daily rates), or to prorate monthly leases by the portion of days parking facilities are used.
Long Term versus Short Term parking locations: “Early Bird Specials" favor long-term parking – such discounts are appropriate for less convenient parking facilities, but not for parking at prime locations, which should be reserved for people parking for short-term errands.
Hot Buttons: Drivers (in the U.S.) are accustomed to free parking at work and shopping locations so employers may feel a competitive disadvantage where parking pricing occurs. Drivers need to clearly understand rates and dynamic parking since rates can change quickly.
Resources
SeaPark Performance Parking Program - Seattle, WA US