Donald Shoup
Donald Shoup

Donald Shoup is a UCLA professor of urban planning, and the author of “Parking and the City.” This op-ed appeared in The New York Times.

If you’ve ever driven a car in New York City, you probably know the drill: The city’s free on-street parking gives a small, temporary benefit to a few lucky drivers, but it creates big problems for everyone else. Drivers hunting for an open spot will circle the block, wasting fuel, congesting traffic and polluting the air.

One approach is to charge for on-street parking. But how much? And how do you make it politically acceptable in a city where drivers are used to paying nothing?

Fortunately, there’s an answer to both questions: Sell market-priced parking permits for certain heavily trafficked parts of the city, then plow that money back to improve the nearby neighborhoods.

The problem is a big one. Laid end-to-end, New York’s 3 million on-street parking spaces would stretch almost halfway around the earth. They would cover about 17 square miles of land, 13 times the size of Central Park.

Because 97 percent of New York’s on-street parking is free, the indirect parking subsidy — what the city gives to drivers in the form of free parking — is astronomical. For example, if only half of New York’s on-street spaces were metered and the average revenue per space were only $2,000 a year ($5.50 a day), the total revenue would amount to $3 billion a year.

There are other, indirect costs as well. One study of 15 blocks on the Upper West Side of Manhattan found that drivers cruised more than a third of a mile, on average, before finding an open space. In a year, this cruising created about 366,000 vehicle miles of travel and 325 tons of carbon dioxide emissions.

If New York charges market prices for curb parking — the lowest prices that will produce one or two open spaces on each block — drivers won’t need to hunt for parking because they will always see open curb spaces available wherever they go. Parking won’t be free, but it won’t be scarce.

The New York City Council is considering a proposal for residential parking permit districts, in which drivers would need to buy permits to park in certain parts of the city. If the permit prices are set by the demand for parking in the area, they will be higher near, say, Times Square and lower in northern Manhattan.

Needless to say, this won’t be popular — nothing is more political than parking. To create the necessary political support for market-priced curb parking, some cities have created so-called parking benefit districts that dedicate the meter revenue to pay for added public services on the metered streets. Everyone who lives or works in a parking benefit district can see their meter money at work cleaning the sidewalks, planting street trees and providing free Wi-Fi. New York could do the same with its permit plan.

To avoid unequal public spending among the parking benefit districts, New York can use what in public finance is called power equalization: Regardless of the revenue each district earns, the city can give every district equal revenue per curb space to pay for added public services. Equal effort will produce equal results.

Suppose the city’s average revenue per curb space is $2,000 a year. The city can spend $1,000 per curb space for added public services in all the parking districts and spend the other half for citywide services, such as cleaning subway stations. Drivers parked above ground will pay to improve life for everyone traveling underground.

Parking permit districts could also eliminate the need for drivers to move their cars on street-cleaning days: The revenue can pay for staff and equipment to clean under the parked cars. That cuts down on an annoyance for locals, and another major source of congestion and pollution.

Market prices for curb parking do not mean only the rich will park on the street — remember, the permits are market priced, based on the users’ willingness to pay. Because cities are typically segregated by income, the rich will compete with each other for curb parking in their own neighborhoods and pay higher prices than the rest of the city. Richer neighborhoods with higher parking prices will earn more revenue, but power equalization will send much of this money to poorer neighborhoods with lower parking prices.

Several cities across the country are considering parking benefit districts, but for the most part they are putting them in commercial areas. How well would they work in residential areas? Manhattan would be a good place to find out, because 78 percent of households do not own a car.

Diverse interests across the political spectrum can find things to like in a parking benefit district. Liberals will see that it pays for public services. Conservatives will see that it relies on market choices. Drivers will see that it frees them from moving their cars for street cleaning. Residents will see that it improves the neighborhood. Environmentalists will see that it reduces energy consumption, air pollution and carbon emissions. Elected officials will see that it depoliticizes parking and pays for public services without raising taxes.

Cities can fairly and efficiently manage their curb space as valuable public real estate used for private parking. They can stop subsidizing cars, congestion and carbon emissions, and instead provide better public services.

Parking benefit districts can improve cities, the economy and the environment, one parking space at a time.