Free Markets – part III (Parking)

On February 3rd the Wall Street Journal ran a story, Parking Fix. (I believe you need to subscribe to the WSJ for this link to work.) It pointed out that “Free-market economists are overhauling a frustration of American life -- and erasing what may be one of the last great urban bargains”. The article should be food for thought for our city and town leaders particularly in Northern Virginia in places like Leesburg where on-street parking is limited and off-street parking in the Historic District is scarce.

The article says that planners for years believed that, “cities can never have too much parking, and it can never be cheap enough. But a small but vocal band of economists, city planners and entrepreneurs is shaking that up, promoting ideas like free-market pricing at meters and letting developers, rather than the cities, dictate the supply of off-street parking.”

“Seattle is doing away with free street parking in a neighborhood just north of downtown. London has meters that go as high as $10 an hour, while San Francisco has been trying out a system that monitors usage in real time, allowing the city to price spots to match demand. (A recent tally there showed that one meter near AT&T Park brings in around $4,500 a year, while another meter about a mile away takes in less than $10.) Gainesville, Fla., has capped the number of parking spots that can be added to new buildings; Cambridge, Mass., works with companies to reduce off-street parking.”

Donald Shoup, a professor at the University of California, Los Angeles published a book, The High Cost of Free Parking. Shoup accuses cities of "mismanagement of the worst sort". He developed the "85% rule, the Journal reports. “Cities, he says, should charge whatever rates lead to about 85% of the spots being filled up at any given time, moving rates up or down as demand fluctuates”. The 85% target now serves as a policy guideline for cities including Portland, Ore., and Anchorage, Alaska.

Cities and towns like Redwood City, and San Francisco are finding that Shoup’s ideas and similar free market solutions are working. Maybe this is one idea from California that Virginia should buy into.