Some Thoughts On Metro’s Modest New Parking Policy Proposal

At this Thursday's meeting, Metro's Board of Directors will be voting on modest changes to the way the agency manages parking. Theoretically, these changes are expected to set the stage for increased parking revenue, which has positives for walkability and livability, but the devil may be in the details.

According to the staff presentation [PDF], Metro currently manages more than 70 parking facilities with more than 22,000 parking spaces. In 2016, with new Gold and Expo Line extension parking lots opening, this will rise to more than 25,000 spaces. 330 more spaces are added when the Crenshaw/LAX line parking lots open in 2019.

Metro Boardmember and Duarte City Councilmember John Fasana, at last week's Executive Committee meeting, remarked that parking spaces cost Metro "$40,000 a pop." And that's just up-front costs, without ongoing maintenance and operations. Metro's overall 25,000 space parking portfolio, assuming parking expert Don Shoup's industry standard of $24,000 per space instead of Fasana's higher number for above ground structures (some spaces cost a lot more than this, probably some cost less), cost the agency at least $600,000,000.

So, even under conservative estimates, Metro has spent more than half a billion dollars on parking spaces. Metro gives more than 93 percent those spaces away for free. Metro CEO Phil Washington and other Metro leaders increasingly frequently speak about budget shortfalls and the need for increased revenue, cost-cutting, and likely fare increases.

I've often written critically about Metro's free parking as a massive unfair loss leader for the agency. What might be given more weight is analysis by transportation experts. Metro's recent peer review by a panel of American Public Transportation Association (APTA) experts made the following recommendations that bear repeating here: (full APTA review coverage here)

• Station parking is expensive to build and maintain, so parking costs should be [at least] partially recovered.
• Easy parking encourages driving that first last mile; it's better to re-direct parking resources to instead fund convenient, frequent bus service.
• Free park-and-ride subsidizes higher income riders and decreases transit’s air quality benefits.

So... with looming deficits and expert recommendations, Metro is retooling the way it does parking.

Not quite.

The new Metro parking ordinance is unfortunately not so different from current practices.

The proposal consists of two documents: a 31-page mostly-boilerplate Metro Parking Ordinance [PDF] and a 12-page Parking Rates and Permit Fees [PDF]; both are summarized in this presentation [PDF]. The bottom line on how Metro says it will manage parking: "No New Fees at Park and Ride Facilities With the Exception of Union Station."

Under current Metro regulations and practices, the agency can tow cars that violate agency rules. The new ordinance sets up rules under which, instead of high-stakes towing, the agency can ticket parking violations. Perhaps those parking tickets are the real source of revenue in the new policy?

The presentation states that the new ordinance will "provide a structure for pricing, setting parameters for parking fee adjustments" so perhaps this formalization will set the stage for gradually implementing demand-responsive pricing. My fear is that, as I read it, the new policies may be overly rigid for managing something something as dynamic as parking. Parking demand varies dramatically at different times and places. Ideally, parking prices could vary similarly.

Historically, increases to monthly permit costs were determined by Metro parking staff, generally in response to long wait lists for sold-out stations. Even under the current staff-managed permit fees, Metro parking prices remain too low to manage current demand, so more than a third of Metro's permitted lots remain sold out and unavailable even to people willing to pay for a permit (screen print this morning). The new ordinance would somewhat-rigidly lock in current below-market prices.

According to the proposal, the initial parking prices are set by the Metro board, then can be adjusted up or down by another vote of the full Metro board. That, of course, takes months. Alternately the CEO can adjust them up to 25 percent every 90 days:

In 2014, Metro increased the cost of North Hollywood and Universal City Red Line station monthly parking permits. The permits had been $39 and went to $59 and $55 respectively. Those increases (which incidentally, were not enough to keep these high-demand stations from remaining sold-out) would not have been allowed under the new ordinance. Under the ordinance, even CEO Phil Washington could only raise a $39 pass by 25% or $9.75.

So, for the roughly 7 percent of Metro parking where the agency actually charges for monthly permits, the new policy would lock in below-market prices, at least for a while.

It is worse for the 93 percent of Metro parking that is free today.

The proposal effectively locks in free parking for 93 percent of Metro's station parking. The proposed rules allow the CEO to adjust free parking prices by 25 percent, but 25 percent of zero is still zero. So, even where demand, budget, environmental, or equity issues would favor shifting from free to, say, a dollar, any increase on free parking will take a vote of the entire Metro board. Ideally, one of the directors will catch this oversight, and perhaps modify the language. Perhaps Metro's CEO could be authorized to modify board-approved parking rates by up to 25 percent or by up to one dollar a day, without requiring board approval. (One dollar per day is 25% of Metro's standard $4 daily parking fee - what the agency charges for a single space for a single day.)

From my reading, it is also unclear how, within a given station parking lot, the Metro would convert free parking spaces to paid parking spaces. In the past, this was a staff decision, at least somewhat responsive to demand for paid permits. Gradually the number of permitted spots in many stations has grown to meet demand - though there are still free spaces in paid lots. If this shifting of spaces is governed by the above restriction favoring free parking, it should not. Staff or CEO should be able to reallocate spaces within a given lot, based on demand.

Lastly, the new ordinance enshrines free parking at stations where it should not. The new rate schedule includes no paid parking anywhere on the Metro Expo Line, including the often-full La Cienega station parking structure, which has the sad absurd situation, for years, of having two floors of parking signed as restricted to permit holders, but no permits for that station are on sale at Metro's parking website. There is no paid parking on the Green Line, though the Norwalk station's massive lot is said to fill up on occasion. If Metro is retooling its parking policies, it is important not to lock in free parking at those stations, and probably others.

At a time when Metro is facing a fiscal crunch, it is critical that the agency not making parking revenue improvements more difficult. While this policy may be laying some groundwork for some later improvements (and, likely improves revenue from citations and from Union Station) I would urge the board to continue to refine the policy before approval.

Ideally, though perhaps in the longer run, the Metro board should set principles and perhaps performance targets. Does the board want parking operations to for pay for themselves? Does the board want parking to contribute a target amount of revenue to cover operations and state of good repair? Does the board ultimately want great places at their stations - or pedestrian-unfriendly seas of free parking? The board should set these broad directions and should give Metro's CEO and staff enough authority to carry them out.