Thursday, May 05, 2005

The mobility solution for Houston - Part 3 of 3: Cash-out parking at work

OK, so now we have our high-speed network of MaX lanes (part 1) and a robust set of transit options on that network (part 2). The final piece of the puzzle is giving people the real financial incentive to switch from their car to these new transit options. The third LA Times article (abstract) provides that final piece: letting employees cash-out of their subsidized free parking space at work.

"Once you buy a car, insure it and have a parking permit, why not drive to work? That's what most of us do, and it's a choice made much easier because 95% of automobile commuters in Southern California park free at work. Employer-paid parking is the most common fringe benefit offered to workers, and the cost of all this free parking amounts to about 1% of national income. Almost everyone who can park free drives to work, but taking away any fringe benefit is difficult.

There is an ingenious way out of this dilemma: Employers can offer commuters the option to "cash out" the value of their free parking. Commuters can continue to park free, but the cash-out option encourages them to consider alternatives to driving to work alone. Would you walk, bike, carpool or ride the bus to work if someone paid you to do it?

If employers with more than 50 employees rent parking spaces for drivers, California law requires them to offer their workers cash equal to the parking subsidy. The money the employer saves on parking goes to the commuters who stop driving, so the program costs the employers almost nothing.

Few people have heard of the law, and the state has not enforced it. Even so, some companies voluntarily offer their workers cash to not park, and the results are promising. In one study, the share of Southern California commuters who drove to work alone fell from 76% before a cash offer to 63% afterward. The number of cars driven to work fell 11%. Three times more solo drivers switched to carpools than to transit, which shows that offering cash instead of parking can work where public transit is not available. By encouraging carpools, the offer of cash exploits the vacant seats in cars already on the road to work.

Employers praised "cash for parking" for its simplicity and fairness, and said it also helped them recruit workers. The cash-out plan reduces traffic congestion, conserves gasoline and improves air quality without increasing employers' costs."

I've heard of other cases where 25% or more of employees switch to some form of carpooling or transit when given the cash-out option. I believe downtown has a 30+% transit ridership rate because parking there is usually not free. Can you imagine the congestion reduction if we could remove 1 in 4 cars at rush hour? It would be huge. Even a 10% reduction would be very noticeable.

So there you have it, the complete 3-part mobility solution for Houston that is not only inexpensive but could be implemented very quickly:
  1. A comprehensive network of managed express lanes (MaX Lanes)
  2. A wide range of point-to-point private transit express services to use them
  3. Cash-out parking at work: a no-cost financial incentive to stop hauling 2 tons of steel to work with you every day


At 12:10 PM, May 15, 2005, Anonymous Anonymous said...

Great idea's...however:

Prices for parking are set by supply and demand. As less people use the company provided parking, the prices will decrease. As the prices decrease, so will the incentive to "cash in" for unused parking spot.


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