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Thread: In downtowns, does free parking equal more business?

  1. #1
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    In downtowns, does free parking equal more business?

    You've heard it before: "These parking fees are killing business!"

    What do you all think? Accurate statement or scapegoating?

    I'm working in a fairly urban setting, but one that is competing with surrounding towns where they don't charge for parking. Obviously, the economy is poor right now, business is down, and there are more vacancies. Merchants, politicians, and others are pointing at the parking authority who (gasp) charges people to park, as the culprit.

    The argument's converse(?) is equally potent, i.e., IF you allowed free parking, we would get more business.

    Most planners know that free parking isn't free, and certainly larger cities where parking costs an arm and a leg don't have any problem "attracting business." But has anyone run across any studies for smaller downtown that actually show a *causal link* between paid parking and business attraction? Is free parking really a determinative factor? Or just a convenient scapegoat? And where is the evidence either way?

  2. #2
    Cyburbian mike gurnee's avatar
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    Free and UNREGULATED parking means that shop owners and employees will park in front of stores all day, depriving potential customers of the most convenient and valuable spaces. Good luck convincing downtown businesses and your council. There are a wealth of studies about this; your state Main Street program is a good resource.

  3. #3
    Cyburbian
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    I think it depends on how it's done. Free parking with strictly enforced time limits I don't see a problem with in the downtowns of medium sized cities and smaller.

    I think it ultimately boils down to how the parking meters are being used though. If they're being used strictly for revenue, I can see them hurting businesses. If they're used to address traffic and parking issues, they'll probably help businesses.

  4. #4
    Cyburbian Cardinal's avatar
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    I can't say that I have seen studies of the issues, but have made observations from hunfreds of downtowns and neighborhood districts across the country. There is a balance of factors at play:

    - Do the businesses have significant drawing power or are they merely run-of-the-mill shops? People are more willing to pay if they perceive the district as a destination and have a strong desire to visit the shops, restaurants, etc.
    - How much customer traffic is there? You allude to this. In heavily visited distrcts you can get away with charging for parking.
    - What percentage of customer traffic is using alternative means, such as transit or walking, to visit businesses?
    - Is there a problem finding adequate parking for downtown office workers, and is the cost of parking so high that it takes a serious bite out of wages? (This can make it difficult to recruit workers and work against offices being located downtown.)

    Mike made a very good point. If you were to do an analysis you would probably find that a significant number of spaces are being used by employees or owners, who WILL park directly in front of their business and then complain about customer parking.

    There are many new parking enforcement technologies and techniques that you can try. One possibility would be to offer the first hour of parking for free. Other communities have businesses (maybe the BID?) provide parking vouchers for customers who make a purchase. Couple these ideas with strong enforcement. New technologies allow enforcement staff to take down license plate numbers, so no more markeing tires. This lets them monitor the people who will pull their car a foot forward every two hours to avoid being fined. Also use a graduated fine. Maybe the first violation is a warning, the second is a $15 fine, the third through fifth are $25, and then they go up to $50.

    Another new technology allows people to buy a grace period. Say you are at a restaurant and two hours have passed. You can get on your smart phone, call the meter, and buy up to an hour of additional time. Perhaps you would set a limit on how often this option would be available, to avoid it being abused.

    Lastly, I wonder if complaints would drop off if you were to post the names of the most frequent violators. I suspect Mike is right, in that the names of many of the complaining business owners would appear on that list. It might embarrass them. It might shut them up.
    Anyone want to adopt a dog?

  5. #5
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    Thanks for the replies, advice, etc.

    We are fortunate in that our merchants are sophisticated enough to understand and acknowledge the importance of turnover in the spaces. Even the arguments within the community in favor of free parking make room for enforcement in order to avoid the phenomenon of people camping in a valuable spot all day long. There are subordinate discussions about WHEN to enforce, how aggressively, graduated fines, etc., but in all of those discussions, people seem to be willing to be guided by the data.

    The 400lb gorilla however is paid versus free parking. We went from a mostly free (i.e., taxpayer subsidized) parking system 7 years ago to a user-fee system, with a financially self-supporting parking authority.

    The debate is filled with anecdotes about how Customer So-and-so got a ticket, got angry, and swore never to come shopping here again, or that "if I can get just as good a meal in [neighboring town] and park for free, why come here where I have to pay to park?"

    The fact is that the surrounding towns are wealthier and their operating budgets can easily afford to offer parking for free (if our town went back to subsidizing free parking, it would mean taking something else out of the budget -- like library funding, after school programs...you get the idea). Further, to your point Cardinal, our rates are not so high that they're taking a significant bite out of wages or somebody's evening's entertainment -- it's $1-2/hr, $5 for 3-hours, after 6PM, $2 all night...that kind of rate structure. The resulting budget has allowed the parking authority to do some capital improvements in the town's parking facilities as well as some technological initiatives such as pay-by-phone (adding time to your meter via cell phone while you finish your cappuccino).

    More reasonable voices in the debate acknowledge that it's more about the draw than whether parking is free or not. If you are offering attractions or a retail experience that people want, a couple bucks to park probably isn't going to matter. Unfortunately, as we all know, reason doesn't always win the day in these debates, and being surrounded by towns that are a) doing better economically, and b) offer free parking gives the free-parking advocates a lot of ammunition...at least for the part of the electorate that doesn't understand the difference between correlation and causation.

    Hence my quest for a study that tests the free-parking-as-economic-silver-bullet theory...

  6. #6
    Cyburbian michaelskis's avatar
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    One of my client communities have free on street parking and no off street parking requirements within the core commercial area. They also have 100% occupancy every summer too as it is a tourist based economy here. They do however have one city owned parking lot in downtown that is used as an overflow lot for the beach (with a shuttle) and the beach parking lot charges.

    For years have have had this conflict between parking needs and available parking. Recently in the documentary "Urbanized" it noted that parking, much like driving, is not a right, it is a privilege and a city does not "Need" to provide for it.
    Not my monkey, not my circus. - Old Polish Proverb

  7. #7
    Cyburbian
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    I think Cardinal points out the right questions that you need to ask in crafting a parking management strategy.

    I agree that simply going with a Shoup-inspired parking pricing scheme may be counterproductive if the district is struggling and its competitors offer free parking (as much as it may seem like the right thing to do). But unregulated parking will surely kill business if people can stay parked in front of stores all day.

    Your parking management strategy needs to take into account where the choice spaces are (those that are most visible and in front of stores) and aim for turnover in these spaces. I've heard it said that if a block or lot is less than 85% full, customers feel they can find parking. In lieu of metering spaces, parking time limits are a good way to turn over spaces and can generate income (from fines) that covers the cost of enforcement and then some (for district beautification, signage, etc). There are little tweaks you can do - such as 15-min spaces in front of certain businesses or at the ends of blocks (I recall one natural grocer that loved that the "little old ladies" could pull up and get their vitamins.) Spaces further out can accommodate longer-term parkers.

    But you also need to think about signage - do drivers know there is additional on-street parking or a public lot around the corner? Do employees and those who need to park more than a couple hours know where to park? Does the walk from parking to the shops feel safe and well-lit? Etc.

    An analysis can also tell you if you simply have a management problem - as most districts do - or if you truly lack parking for your current and future needs.

    Several folks shared some good basic parking management articles with me recently that might help educate your district. "Parking Management Made Easy" by ODOT was particularly approachable. Todd Littman and the Institute for Transportation Development Policy each have a more technical guide, and the Main Streets center puts out a guide for small/medium towns that may be well suited for neighborhood districts ... I agree that your state Main Street program should have resources on this!

  8. #8
    Cyburbian DetroitPlanner's avatar
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    Free parking means your downtown is not a premium place to be.

    Premium places generate a lot more traffic through pedestrian, bikes, and transit.

    Therefore to assume that free parking equals more business is not a good measure of how successful a downtown is for doing business.

    The parking garage where I park my car chages $20 a day... and thats in DETROIT! They get that kind of money because this is a very vital part of the CBD. The casinos downtown all offer free parking. Why? Because the other casinos downtown all offfer it. It is a money loser, but maintaining structures for thousands of cars is quite expensive.
    We hope for better things; it will arise from the ashes - Fr Gabriel Richard 1805

  9. #9
    Cyburbian
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    Apologies to the OP, my last comments were a bit after-the-fact. You pose an interesting question. I am used to seeing the more affluent areas (like Boulder, CO) charging for parking because they are desirable destinations, while more struggling areas have free parking. So reversing this situation and having free parking in nearby more affluent areas while it sounds like your district may be struggling, could be a challenge. How have your businesses been performing, and did the move to metered parking change the trend in any way? Are you trying to keep your residents in town, or trying to draw from neighboring towns? And anecdotes aside, would your residents really rather pay for gas to drive to free parking in a neighboring community?

    If the merchants truly want free parking, would they be willing to pay for parking maintenance thru a business improvement district or assessment rather than general fund (while paying for enforcement thru fines). This may be a very direct way to get to the value of free parking to the merchants, rather than put general fund money on the table.

  10. #10
    Cyburbian
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    I've never seen free parking in an Urban Core. I would guess it depends on what other attractions you have around the businesses. Is it soley merchants? Or are there offices as well. Free parking around offices would kill businesses faster than pay parking ever could. Employees who get to work before stores open up would eat up all of the parking and just stay put.

    Also, are you talking about street parking? Or lots? As someone alluded to previously, a "free" parking lot can never truly be free. Just subsidized. And who would be the entity picking up the bill for maintenance? The city? The Commerce Community?

  11. #11
    Cyburbian Coragus's avatar
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    If people want to shop your downtown, they will shop your downtown. The cost of parking has been, in my experience anyway, a minor detail.

    The point about business owners parking in front of their stores is good. This can be somewhat addressed with strictly enforced time limits, but that is circumvented by running out every two hours and moving your car ahead one space.

    You may also run into the issue of a high turnover business, like a Subway, sitting next to something like an antique store. The Subway will depend on people parking close, running in, and leaving. The antique store will not have that issue and their customers may take the Subway's spaces. So, do you start dedicating spaces for the Subway if they ask? Yeah, I went through this issue, and no we didn't.
    Maintaining enthusiasm in the face of crushing apathy.

  12. #12
    Cyburbian ColoGI's avatar
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    Just want to bring these good points out:


    Quote Originally posted by michaelskis View post
    Recently in the documentary "Urbanized" it noted that parking, much like driving, is not a right, it is a privilege and a city does not "Need" to provide for it.
    Quote Originally posted by DetroitPlanner View post
    Free parking means your downtown is not a premium place to be..
    -------
    Give a man a gun, and he can rob a bank. Give a man a bank, and he can rob the world.

  13. #13
    Cyburbian Tide's avatar
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    Would your city rather fund free parking (yes at a cost to the citizens) or have paid parking with free transit service around and to downtown?
    @GigCityPlanner

  14. #14
    Cyburbian wahday's avatar
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    Michaelskis and DetroitPlanner's comments are correct, I think. There is a real science to creating the perception of "demand" in downtown areas and parking contributes significantly to that. To quote an oft-used Blues line: "don't give it away!" It makes your downtown look cheap and easy...

    I would also direct people to Donald Shoup who wrote The High Cost of Free Parking which I found to be an excellent analysis of this very topic (admittedly I did not read the entire book, just two chapters. But I think his analysis is excellent). This is a link to his personal/professional page with links to articles and other texts on the matter.
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  15. #15
    Cyburbian WSU MUP Student's avatar
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    I have no real data to back this up but just my anecdotal experience from the area I live in.

    The downtown right down from my house has metered parking that is strictly enforced from 9:00 a.m. to 9:00 p.m. as well as three small metered lots. They also have five city owned garages with free parking for the first two hours (I believe it's $1 an hour after that). The community is very walkable and a major draw among regional residents for dining, entertainment and shopping. There is also a significant employment base in the downtown (mostly finance, marketing, advertising, and now some tech firms moving in). Finding an on-street parking spot is next to impossible from early in the day until late at night. Even with the abundance of parking garages (which I have never seen one that is completely full) offering two hours of free parking, folks would rather pay for the convenience of parking right on the street and paying $1 an hour at a meter. Occupancy rates in the downtown are notoriously tight. I have never seen a business leave and heard of parking as one of their reasons. In fact, two retail establishments recently left the large mega-mall about 2 miles away and re-opened in the downtown. Paid parking doesn't seem to be a problem here.

    There are a few other suburbs in the area that also have no free parking in their walkable downtowns and consistently have full lots, garages, and metered spaces and very few empty storefronts.

    I would agree with the basic premise that others have said - if your area is a destination, people will come regardless of the parking costs.
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