Magazine

To Reset or Not to Reset…


Even Shakespeare might have a problem with this conundrum. Should on-street meters be reset when the vehicle leaves the space? I set off a firestorm on my PT Blog in late May and thought I would share some of it with PT magazine readers. I have heavily edited the statements and responses here; to see all of the piece, log on to www.parkingtoday.com and click on PT Blog. Scroll down to the May 23 post with the same headline and it’s all there. JVH.)

 

The City of Santa Monica and the City of Los Angeles are installing sensors in on-street spaces that will reset the parking meter to “zero” when the vehicle leaves the space. Officials claim that it is to affect parking policy, and not to be used to help enforcement. Ya, right.

I was asked to participate in an LA-area radio program discussing this issue, and listened to caller after caller decrying the sensors and griping about the new policy.

“It’s like winning the lottery,” said one caller. “You pick up a few minutes and you think ‘Wow, a little something good happened today. …’” Virtually all callers felt that this was simply a way for the city to “grab” more money.

Many also discussed the morality of the situation. A person pays for an hour and leaves after 40 minutes. Why is it wrong for the next person to park for that “extra” 20 minutes without having to pay?

        The purpose of metered parking is to create turnover for local merchants. It is to keep residents and workers in the area from taking spots. Rules against “feeding” the meter prevent this type of activity.

        If one buys the maximum amount of time, then to keep turnover working, you are enjoined from putting more money in the meter. So the reset to “zero” is needed to ensure that we get the proper turnover. Fair enough.

However, how about the PR the city receives when the parker gets a few minutes of “free” parking by piggybacking on someone else? It seems to me that this is a small price to pay if we have the technology to allow piggybacking but also ensure turnover.

We should remember one other thing: When we change to a pay-by-credit-card meter, most people pay the maximum anyway, whether they plan to stay the maximum time or not. Revenue skyrockets for cities because of this.

Other benefits of the new meters is the “up-time,” and the fact that the meter can notify the city if it is having a problem and can be repaired quickly. The downtime in the city of LA is very low, less than a few hours at most.

Are we really so concerned about every penny that we reset the meters? I’m told that after a few weeks, complaints about resetting die away and “all’s right with the world.” But I wonder …

People remember a kinder gentler time when folks put a quarter in a meter to keep a stranger’s car from getting a ticket, or when police warned merchants that the enforcement patrol was coming so meters could be fed or cars moved.

If a city is so financially tapped out that every little bit needs to be wrung out of the citizenry, isn’t something else wrong? When parking policy becomes a “tax,” instead of a way to affect behavior, are we moving in the right or wrong direction?

         JVH

  

   •••

       

Technology Costs Money …

Charles J. DeBow, Parking Manager for the Borough of State College, PA:

The new technology, sensors, credit card meters, kiosks, etc., all cost money. People want these options, but they do not want rates to increase. Pay-and-display basically has “meter reset,” and the increases in revenue help offset the costs.

Yes, I know, people pay more when using a credit card, but the way I look at it, that is their choice to ensure they don’t get a ticket. They are paying for “peace of mind.”

To have meter reset, you need a sensor, and at $20-$30 per space/month, you need a revenue stream to pay for it. How do we do that, especially in markets where the rate is $1/hour or less? There are only two options: meter reset or increased enforcement, because we should become more effective with the sensors.

Your argument of credit card (CC) meters’ skyrocketing revenue is true only with meter reset. If they pay the maximum and stay only a short time, the next car will still use the time that is left. Plus, CC meters are extremely expensive.

The LA’s, Philadelphia’s and NYC’s of the world can afford this based on their rates. The little guys have to be a bit more creative to pay for the technology that people see in these big cities and expect everywhere; sometimes it’s the only way they can afford it.

Now this doesn’t mean you just start resetting meters. Engage the community, tell them that meter reset is being used to help pay for the technology, and you may find yourself on right side of a news article – win-win.

I do not think you get good PR by leaving it. You get a little bad PR when you use meter reset, but it goes away. And like I said, with a little upfront work, you may find that people are OK with it.

 

•••

 

But What About ROI?

Brandy Stanley, Parking Services Manager for the City of Las Vegas:

CJD hits the nail on the head. This stuff is expensive to buy and operate. Communications costs, credit card fees, maintenance, etc., drive operating costs way up. If you want to focus on generating revenue through compliance, you need to make it easy and convenient to pay, which means accepting credit cards at all your meters.

That reduces your ticket count (and citation revenue), so how do you replace that revenue and cover the increased costs of providing customer service? One way is to reset the meters – and it’s not a few pennies; the industry standard is a 20% to 30% increase, which is substantial.

Even this may not be enough to cover the increased operating costs and loss of citation revenue. Just because we’re the government doesn’t mean we have an excuse to completely ignore cost recovery on a major investment. We may have different ROI standards and a different focus on the value of an investment than the private sector, but we also have a fiduciary responsibility to taxpayers that we ignore at our peril.

There is typically some bad PR to start, but you can help offset that by telling customers you’re making it easier to pay and less likely they’ll get ticketed. What meter system can you put in, resetting or not, that doesn’t generate some degree of bad PR? Pick your poison.

       

JVH responds:

Good arguments, Charlie and Brandy. However, I’m not convinced on the loss of citation revenue. If we assume that half of the citations that could be written aren’t – and I think in most cities that number is closer to 90%, then stepping up enforcement could make up for the folks who pay the maximum and thus don’t get citations.

Of course, in the end, are we here to generate revenue, or to change habits and protect a valuable parking asset? We all know that answer: on the record, change and protect; off the record, revenue, revenue, revenue.

       

Charlie says:

JVH, so you want me not to have the bad PR with meter reset but increase tickets? That’s even worse PR!

Actual capture rate is closer to 4% to 7%, proven by sensors, including the ones I have, and what the sensor company is telling me from other cities.

We can not turn a blind eye to revenue. Proper programs require proper fiscal responsibility to make sure we can pay for the technology, and to make sure we never spend a single taxpayer penny.

       

JVH responds to Charlie:

Huh! I’m not saying you increase your number of citations written; just keep the number the same. Even though people will perhaps pay the full fee when they park only part of the time allowed, there will be certainly many others who will break parking rules.

And, yes, parking needs to pay for itself, and if the technology used costs more, then more needs to be collected. However, we both know that in well-run parking operations, the income far exceeds the costs.

Where does that money go? Does it go into the neighborhoods where it came from for better lighting, streets and sidewalks?

Or does it go into the General Fund? What happens in State College, Charlie? …

Charlie answers:

In State College, it goes to the General Fund. We do not earmark funds, and I will try to explain why. Many of our Capital Plan Projects and most of our normal operating expenses can be directly attributed to the downtown.

       

But our tax revenue comes mainly from our neighborhoods. That’s because our tax base in the downtown is mostly non-income students. We far outspend our tax and parking revenues that are generated from the downtown.

Basically, parking revenue goes right back into the downtown. I just can’t tell you that it was for a specific lighting or sidewalk project. Make sense?

So, in my view, although we do not specifically say parking is spent on the lights and streets, it is, as it should be.

This is where I disagree with [Urban Planning Professor Donald] Shoup. His model works great in larger cities where there can be “districts,” and the money generated in District A can stay in District A and not be spent in Districts B-F. I have only one district.

JVH responds:

Hey, Charlie, small cities don’t have the flexibility that large cities do. I would think it was the opposite. OK, your parking revenues go into the General Fund. You know how much goes into the fund, and you also know how much is spent on infrastructure projects in your downtown area (where the money comes from).

My guess is that you could put up a sign next to a new tree, or lightpost, or park bench that says something like, “Part of the money used to buy this bench came from the money you pay in parking fees.” Most likely you could do that almost instantly there.

However, in a large city, the causing of that sign to be created would be a world-class bureaucratic headache. Just because the money goes into the General Fund doesn’t mean you can’t take credit for benefits that the area around the parking spaces receive.

  

   •••

       

Because We Can …

Dan Kupferman, Director of Car Park Management Systems at Walker Parking Consultants, joins in:

Yes, we want to stop piggybacking for the money, which is a common practice. Many rent and lease agreements are non-transferable, as are most tickets to events. You can’t finish someone else’s meal at a restaurant (OK, now I’m reaching).

The nice thing about multi-space is that the piggybacking goes away automatically. Politicians can call it an unintended consequence. With single-space, you need to take the extra steps (and costs) of adding sensors, so you appear greedy – like the airlines charging for leg room and luggage. Why do they do it? The same reason we’ll reset the meters – because we can.

        

   •••

       

But Is the Technology Reliable?

Kevin Holliday of USC, former SFpark Project Administrator for the San Francisco Municipal Transportation Agency:

Parking sensors are not very reliable. If they are magnetometer sensors, they could be thrown off by a large metal dumpster or double-parked garbage truck. So you could have some “resets” occurring for a whole variety of reasons other than the fact the driver moves her car.

Let’s do some math. Assume that parking sensors are 99% reliable. They are not, but let’s give the sensor manufacturers the benefit of the doubt.

In a big city like LA, with 40k meters that, say, average three sessions per day, you have 120k daily sessions. At a 1% error rate, you are talking about 1,200 parkers potentially exposed to tickets. Every day.

Now my numbers may be way off, and most cities have very low capture rates, so the wrongful tickets ought to be low. But still. Talk about bad PR.

In the mind of Jane Q. Parker, reset policies tend to get lumped together with market pricing for on-street parking. Both get seen as a ”bad” policy. SFpark explicitly eschewed a reset policy as a way to demonstrate to the public that the city was trying to apply market principles to on-street parking, rather than try to screw drivers.

Given Santa Monica’s decision to implement a reset policy, I think they will have a tougher time trying to implement market pricing down the road. And that is a real shame.

       

Morally Bankrupt?

From Brandy Stanley, Parking Services Manager for the City of Las Vegas

The argument that leftover time on a parking meter is the same as charging airline customers fees for “extra” services doesn’t seem like an accurate analogy to me. It seems like a manifestation of the entitlement attitude that everyone in our industry battles every single day.

Resetting the meters has absolutely no corollary to charging a customer for an additional service. We don’t offer additional services. We offer a parking space, period. We never made it a practice to clean everyone’s windshield for free and then all of a sudden started charging people for it.

Resetting the meters realizes revenue from overselling real estate. We do it every day in parking garages and off-street facilities. We know that a monthly parker isn’t going to be in the facility 24/7. Oversell and our ability to recognize and manage it is in large part what keeps many of us employed.

So how does applying that same principle to real estate on the street make us morally bankrupt? I’m confused, and perhaps someone can enlighten me.

 

JVH responds:

Morally bankrupt? Wow! You have been in Vegas too long, Brandy — I see no moral issues in resetting the meters. I wonder only at the policy issues and whether maximizing revenue for the sake of revenue and to meet a city budget shortfall is good policy. I would suggest that taking money from a small portion of the citizens (those who park on-street, for instance), and using it to, say, pay for the retirement program of the city’s employees is bad policy.

If, however, the money went for things that the people paying the fee could use (sidewalks, lighting, trees, area parks), it would seem more reasonable, and the people paying would see the money they pay (even with meter resetting) as a reasonable value.

      

A Parking Buffet?

From Seamus Wilmot, Parking and Transportation Director at UC Berkeley

If you allow parker B to piggyback on parker A’s unused time, are you also going to allow parker A to sell the unused time to parker B?

I am parker A. I am leaving my parking spot and have one hour left on my meter. Parker B is waiting for my spot because there are no open spaces in the vicinity. [JVH,] using your logic of allowing parker B to have my time, I should also be allowed to sell my remaining hour to parker B for whatever he or she is willing to pay.

You are assuming the time on the meter belongs to parker A, and he or she is allowed to do with it what they want.

Would this also hold true the next time I visit an all-you-can-eat buffet? Can I give my buffet plate to my friend after I have eaten? I didn’t have dessert, so there is still some “value” left on my buffet plate.

Article Abstract from July, 2012




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