Lease Curb Spaces to Residents? Why Not?
For urban residents and commuters, the search for a parking space is unquestionably one of the biggest and most irritating problems confronting them.
It is not unheard of for a condominium parking space to sell for $150,000 to $250,000 in Boston or New York, and the daily search for parking generates a tremendous amount of pollution and wastes millions of dollars of fuel each day. Parking garages and lots typically charge more than $30 for an eight-hour workday, which is not affordable for the average urban resident or commuter.
The scale of this problem far surpasses mere inconvenience and represents one of the largest hidden transportation, traffic and environmental problems that cities struggle with at immense cost.
This article presents a new strategic management methodology that addresses residential parking in dense urban neighborhoods and urban commuter parking, while at the same time reducing carbon emissions and creating an enormous new source of municipal “non-tax” income for cities and neighborhoods.
A City Lease Parking Program solves these problems through the long-term leasing of public residential-street parking spaces to residents and institutions for 5% of the assessed value of their property. They take out a long-term mortgage on their parking space, which allows the city to be paid its entire lease price at the beginning of the lease period, while enabling the resident to pay for the reserved space on a monthly basis (over 20 years at an affordable $3+/- a day).
The lease revenue to the average city, per parking space, is estimated at $20,000. At $20,000 per space, an average city could realize $1 billion in non-tax income every 20 years. Each participating neighborhood would get back 50% of the revenue paid to the city in the form of a Neighborhood Preservation Trust, which would fund the cost of developing more parking and paying for neighborhood improvements, from crime prevention to parks, thereby making the program self-sustaining.
By leasing curb parking spaces directly to residents, the program benefits municipalities and its vehicle owners in the following ways;
Residents and Commuters
• Reserves parking close to home/work
• Low-cost, affordable lease payments
• Sublet to commuters to offset costs
• Reduces gasoline consumption
• Reduces vulnerability to street crime
Cities and Neighborhoods
• Significant new revenue stream
• Revitalizes and preserves urban neighborhoods
• Reduces CO2 emissions
• Reduces accidents
• Reduces crime opportunities
If the average city with 60,000 residential parking spaces leases them – based on the formula of 5% of the average assessed value of the residential property on which they front – it could realize $1 billion in new, non-tax income, most of that in the first year! If institutional land uses are included, the total could be half again that amount. Additionally, a city would receive shared towing fees, fines and saved costs each year during the remaining 19 years of the lease.
If an average urban resident had to pay only $3 per day for a reserved parking space in front of their home, most would take such a lease, especially if they could sublet the space to a daytime commuter, thereby paying nothing for night and weekend parking. Commuters benefit by being able to sublet a parking space near where they work at a fraction of what they would normally have to pay – $0.38 an hour compared with $4.25 an hour for a garage space.
The 20-year lease term can be repeated indefinitely. This means that every 20 years an average city could count on an extra billion non-tax dollars, plus ancillary income and savings. Neighborhoods benefit by receiving 50% of the city’s revenue back in the form of Neighborhood Preservation Trusts.
The parking issues that the program helps solve include:
• Urban Residential Parking: The daily problem of urban residents who do not have off-street parking searching for a public parking space at or near their home.
• Commuter Parking: The equally irritating daily problem of commuters searching for a public parking space near where they work or near a mass-transit stop.
• Institutional Parking: The search for convenient, safe and low-cost parking for urban colleges and hospitals.
• Handicapped Parking: Reducing the illegal proliferation of handicapped parking spaces and stickers.
In his landmark book, “The High Cost of Free Parking.” Professor Donald Shoup calculates the amount of time the average driver will spend in “cruising” for a parking space – 3.3 minutes – and, therefore, the extraordinary amount of CO2 that is generated and expelled into the environment: 1.55 tons of CO2 per parking space per year.
Not only is there a massive amount of unnecessary air pollution, there also is unnecessary waste of gasoline – 100 gallons of gas per space per year – and its direct dollar cost to drivers ($300/year) and in time lost in cruising, 212.77 hours per parking space per year.
If this concept is so good, why hasn’t someone done it before?
Realistically, it has been done – from the standpoint that cities, for nearly 100 years, have leased government-owned property for parking lots, garages and hourly metered parking spaces. The only difference between hourly metered parking spaces and this program is the length of rental time.
It would be difficult to implement.
The program would be completely voluntary. As part of the lease application form, there would be a box that a single-family home owner or a majority of condominium owners or renters can check to not have their fronting parking space be included in a City Lease Program. These curb spaces would be left open to the public, and anyone would be able to park in them as long as they find it first. No one would be forced to participate in the program.
It would pit neighbor against neighbor for the leasing of a parking space.
Not true. In fact, that is exactly what is happening now. This program creates an organized, economically self-sustainable system for allocating parking spaces based on home ownership and length of residence that is fair and objective, and supported by law.
There are not enough parking spaces
The real problem is not the number of parking spaces but that the existing spaces are not being managed effectively. This program maximizes the use of public curb parking spaces by allocating the use of such spaces between the two primary user groups, residents and commuters, based on when they need parking.
Why should people pay for something they have already paid for?
They wouldn’t be. What they would be paying for is the exclusive right to park in that curb space for an extended period of time. The city is selling time. There is no difference in the practice of charging for the right to park one hour, one year or 20 years. The effect is still the same: A private individual or entity is paying a city for the right to park a vehicle on city-owned property for a defined period of time.
The really innovative aspect of the program is not the long-term leasing of parking spaces and creation of a new source of non-tax income for cities, or even the discovery of a way to preserve neighborhoods. It’s the discovery that a significant number of public assets – in this case, curb parking spaces – are not being managed to their maximum effectiveness.
By applying innovative asset-management methodologies, a city not only begins to solve important problems for its citizens, but also creates an entirely new source of income. This new public asset-management paradigm can both make money and save citizen’s money, while being self sustainable.
Copyright © 2003 Richard A. Gardiner. All Rights Reserved.
Richard Gardiner can be reached at email@example.com.