Parking charges first principles assessment

First principles assessment

Why introduce Parking Charges?
The two underlying reasons for introducing parking charges are to influence the demand for parking and to raise revenue. There are a number of reasons why policy-makers might wish to influence the demand for parking:

To reduce parking problems in a particular area
To reduce traffic in an area
To reduce the occurrence of traffic circulating searching for car parking spaces
To discourage people from driving into the area, for example for environmental reasons.

There are two principal reasons why policy-makers may wish to use parking charges to raise revenue:

To cover the costs of car parking provision (including enforcement)
To raise revenue for other purposes.

Demand and Supply Impacts

Demand Impacts
The responsiveness of the demand for vehicle travel in relation to parking charges varies depending upon the availability of alternatives. Figures for price elasticity of demand for parking activity with respect to parking charges are quoted as being in the range -0.1 to -0.4 (Feeney, 1989; Pratt, 1999), meaning that a 10% increase in parking charge will result in a 1%-4% reduction in parking activity. Introduction of parking charges designed to recover the costs of provision, where parking was previously free, can result in reductions in car commuting of up to 30% (Hess, 2001). However, introduction of parking charges in just one area may simply divert traffic to other areas (Hensher and King, 2001). Kelly and Clinch (2006) report that price sensitivity is higher for non-business than business trips. Much political and public resistance to increasing parking charges stems from a fear that this would damage retail or business investment. This fear can be especially acute in towns and cities perceiving that they have economies which are relatively weak compared to neighbours (Marsden et al. 2013). However there is no evidence to support these concerns, except in the case of a city or town competing with out-of –town shopping centres offering free parking (Marsden 2006).

Parking charges enable demand to be kept below the supply of parking space, thus reducing time spent searching. The suggestion that meter prices should be pitched so that one space in seven is free was developed with this in mind. Charges which increase with duration can also influence the length of time for which people park, thus further reducing occupancy of parking spaces. However, it should be noted that a parking place used for short stay parking will generate more traffic than a long stay one.

Responses and situations

Response	Reduction in road traffic	Expected in situations
		Where parking charges are higher in the peak period, some trips may be diverted into the off-peak
		Where there is no longer a need to circulate around several different car parks in order to find a space
		Where the parking charge discourages people from travelling to their previously preferred destination, in favour of somewhere with no or lower parking charges
		Where the charge encourages people to ride-share or to avoid making some optional journeys
		Where the charge encourages motorists to consider public transport, walking or cycling
		Where the charge results in the main driver in a household deciding they no longer need a car of their own
		Where the household decides that there are benefits from living closer to public transport facilities

	= Weakest possible response,		= strongest possible positive response
	= Weakest possible negative response,		= strongest possible negative response

= No response

Short and long run demand responses

Demand responses

Response	-	1^st year	2-4 years	5 years	10+ years
	Peak time charges might encourage spread of departure time
	Where there is no longer a need to circulate around several different car parks in order to find a space
	-	/
	Where the charge encourages people to ride-share or to avoid making some optional journeys
	Charge may encourage mode shift
	-
	-

	= Weakest possible response,		= strongest possible positive response
	= Weakest possible negative response,		= strongest possible negative response

= No response

Financing requirements
Parking charges are a source of finance. This is some indication that this finance can be significant, for instance DfT (2013) state that for English local authorities total income “parking rose from £608 million to £1.3 billion” (s1.3).

Expected Impacts on Policy Objectives
The wider impacts of parking charges depend on the alternative used by the car driver; parking on the fringes of the charged area, or in private parking spaces, will inevitably have less impact on improving the environment and congestion than switching to public transport. Parking on the fringes of charged area can adversely affect residents living at the fringes. A recurring concern with the introduction, or increasing, of parking charges, is that it will encourage drivers, and particularly those shopping, to go elsewhere, thus adversely affecting the urban economy. There is only weak evidence that this happens, and where it does, it tends to be as a result of competition from out-of–town shopping centres (Marsden 2006). A review of aggregate studies found no significant relationship between parking restraint levels and urban economic vitality (Still and Simmonds, 2000). Parking charges will affect low income drivers more than those on higher incomes, and thus can have some equity implications. They may as a result have some minor effects on accessibility. Nevertheless, if they are effective at limiting demand for driving, parking charges can contribute to alleviating problems of equity such as ill health associated with poor air quality, death and injury in collisions on roads, and severance.

As with parking controls, parking charges can readily be applied to publicly controlled parking space. Parking charges, by definition, do not apply to through traffic and, as noted above, cannot usually be imposed at private car parks. These represent major loopholes in the effectiveness of parking charges and, indeed, any form of parking control.

Contribution to objectives

Objective	Scale of contribution	Comment
		Charges can cover some of the opportunity cost of space taken by a parked vehicle, and some of the externalities of motor vehicles.
		Residents’ parking permits can prevent over-demand for parking on residential streets.
	/	Limiting demand for use of motor vehicles can reduce poor air quality and emissions, and limit loss of space given to vehicles. Charges within an area may create harm at the fringes if people park just outside the charging area.
	/	If they are effective at limiting demand for driving, parking charges can contribute to alleviating problems of equity such as ill health associated with poor air quality, death and injury in collisions on roads, and severance. Reduced traffic in residential areas can bring social benefits (Appleyard 1981). However charges might have detrimental impacts on accessibility for those on low income.
		Reduced searching for parking will reduce traffic and driver distraction. Reductions in overall traffic should reduce accidents. Since parked cars are associated with increased danger of collision with child pedestrians and cyclists (Petch and Henson 2000), reduced parking might improve child safety.
		There is weak evidence on a relationship between economic growth and charges.
		Charges typically more than cover the costs of parking supply and enforcement.

	= Weakest possible positive contribution,		= strongest possible positive contribution
	= Weakest possible negative contribution		= strongest possible negative contribution

= No contribution

Expected impact on problems

Contribution to alleviation of key problems

Problem	Scale of contribution	Comment
Congestion		By reduction in vehicle traffic in the charged area and reduction of traffic circulating searching for parking spaces; the extent will depend on the level of charges and alternative travel options available
Community impacts		Reduced parking may bring safety benefits for children, and enhance liveable streets. Reduced use of motor vehicles can bring benefits including reduced severance for pedestrians and cyclists, improved social interaction, improved health and environmental quality.
Environmental damage	/	Limiting demand for use of motor vehicles can reduce poor air quality and emissions, and limit loss of space given to vehicles. Charges within an area may create harm at the fringes if people park just outside the charging area.
Poor accessibility	/	See community impacts above. However charges might have detrimental impacts on accessibility for those on low income
Social and geographical disadvantage	/	There can be health benefits and accessibility for areas subject to high levels of traffic volume and parking if that is reduced. Low income car-users will be disproportionately affected. Charges within an area may create harm at the fringes if people park just outside the charging area.
Accidents		Parked cars are associated with increased danger of collision with child pedestrians and cyclists (Petch and Henson 2000), reduced parking might improve child safety. Reducing overall traffic through charging may bring safety benefits.
Poor economic growth		There is weak evidence on a relationship between economic growth and charges

= Weakest possible positive contribution, = strongest possible positive contribution

= Weakest possible negative contribution = strongest possible negative contribution

= No contribution

Expected Winners and Losers

Winners and losers

Group	Winners / losers	Comment
Large scale freight and commercial traffic		Through less congestion in centres when making deliveries at times when free access is allowed.
Small businesses		Through reduced congestion and availability of parking spaces near to destinations.
Low income car-users with poor access to public transport	/	People might benefit from improved conditions for walking and cycling, and from improved air quality, however parking charges could disadvantage low income car dependent households
All existing public transport users	/	Beneficial for people walking or cycling.
People living adjacent to the area targeted		Where traffic is reduced and public transport is subject to less congestion related delay. But relocation of parking to fringe areas can be detrimental.
Cyclists including children		Parked cars are associated with increased danger of collision with child pedestrians and cyclists (Petch and Henson 2000), reduced parking might improve child safety.
People at higher risk of health problems exacerbated by poor air quality		Reduced parking activity and searching for parking can reduce pollution.
People making high value, important journeys		Where parking is easier to find and searching traffic is reduced.
The average car user	/	Through reduced congestion and availability of parking spaces near to destinations. But car users needing to use public parking will pay more.

	= weakest possible benefit,		= strongest benefit
	= weakest possible disbenefet,		= strongest possible disbenefit

= neither wins nor loses

Barriers to Implementation

Scale of barriers

Barrier	Scale	Comment
Legal	/	Public authorities have legal control over charges in car parks they manage, but tend not to have control in private car parks. There may be legal means of public regulation of private car parks.
Finance		Costs of implementation can be covered by charges.
Governance	/	As legal.
Political acceptability		Parking charges can be contentious.
Public and stakeholder acceptability		Parking charges can be contentious.
Technical feasibility

= minimal barrier,

= most significant barrier

Text edited at the Institute for Transport Studies, University of Leeds, Leeds LS2 9JT