James Trosh/Flickr

Joseph Stromberg, Vox:

When we find an open spot on the street, and there’s no meter, it seems free — but it too is the result of government spending. The cost of the land, pavement, street cleaning, and other services related to free parking spots come directly out of tax dollars (usually municipal or state funding sources). Each on-street parking space is estimated to cost around $1,750 to build and $400 to maintain annually.

Follow the link and you’ll learn that off-street surface parking can cost $1,500 to $2,000 per space.  Underground parking, like the massive underground lots being dug out for new apartments all over Seattle, cost much more, on the order of $20,000 or more per space. That translates into higher construction costs, which means higher rents and less affordable housing.

The whole article is a fantastic primer on why free parking is so terrible. I want to quote the whole thing, but you should go read it instead.

53 Replies to “Your “Free” Parking Costs Taxpayers $400”

  1. Keep in mind construction and maintenance costs are tiny compared to the value lost by not using these spaces for something else. The value of the land itself, especially downtown, is quite high. And if we let developers use this land to build* the tax returns alone would be high, not to mention the added economic stimulus that comes with adding more buildable land. That, and the real secret to a pleasant walkable city is to make the roads narrow.

    * we’re pretty far into theoretical territory here. Trying to go back and remove parking, move sidewalks inward, sell off the old sidewalks, then get businesses to build up to the new sidewalks sounds like an extremely daunting effort.

    1. I know we’re talking about on-street parking, but off-street surface parking is perhaps the most egregiously wasteful. A hypothetical 200-stall surface lot, fully booked at daily rates (say, $20), would bring in about $4,000/day, or $1.4m/year. At commercial office space rental rates of, say, $35/sq ft/yr, that’s about the same topline revenue as just 40,000 sq ft of office space, or one zero-setback single story building on a Portland-sized 200-foot block. I can’t see how any surface lots remain Downtown except as interim uses while the property owner waits for a sufficiently lucrative deal.

      1. Commercial surface parking lots in hot downtowns are, almost always, an “I’m waiting for a good offer from a developer” situation.

        Commercial multi-story garages are different. Commercial garages can clear enough to be profitable, sometimes. If the rates are high enough, and they *can* be (in NYC, $50/day is a good rate.)

        Now, there are synergy effects. As long as there are a lot of car-dependent people, the commercial businesses benefit from having some commercial parking nearby. It’s better if this is shared among many businesses. So it’s desirable to have some commercial parking garages even if you could theoretically convert all the lots to buildings. Not too many — but some.

  2. Just going to put it out there that with new condos (two bedrooms, ~1,000 sq ft) easily approaching the $400,000 range, people will not even blink at the $20,000 for a guaranteed spot. This and on-street parking demand will not change until there is reliable, quick transit in this city, no matter how angry an editorial is written on this blog.

    1. Thus proving this point exactly: “That translates into higher construction costs, which means higher rents and less affordable housing.”

      Of course they will, which then prices out the bottom end of the market entirely. Some apartments in the less-trendy areas of town are already starting to charge for parking spaces that once were included or “free.” (In quotes because we all know the arguments around parking not being free) It lets the landlord capture “missing revenue” (in quotes because that’s a business term for “not grabbing all of the money possible at all, ever, ever,” which is a Seattle landlord’s sole mission) that isn’t possible to get by simply raising the rents–there’s still a ceiling for rents in, say, Lake City–versus simply pointing at “all of the other apartments doing it.”

      As to your point here: “…demand will not change until there is reliable, quick transit in this city, no matter how angry an editorial is written on this blog.” Great, how’s about we actually fund quick transit in this city? No, no, that would be unreasonable and oppressive to car owners.

      1. Your last statement makes no sense. Many car owners in Seattle would gladly vote to fund a true mass transportation system. It’s more the skittish leadership that doesn’t want to jeopardize their career to get the ball rolling.

        The point of my comment was in regards to the original post, which rails against “free” parking in the city, but doesn’t address the underlying problem of why “free” parking is in such demand currently.

      2. I don’t understand your point. “Free” parking is in demand in most cities, because people would rather not have to pay for things of value. Improving the quality of public transit won’t change that; look at New York.

      3. No one in Manhattan has presumed infinite access to “free” parking in a century. No one anywhere in the boroughs presumes ownership of the curb space directly in front of their residence.

      4. THe entitlement issues aren’t as bad, but Manhattan is as well-served by public transit as any location in the Western hemisphere, and has an absurd amount of “free” street parking which is in very high demand and produces a lot of traffic-snarling cruising.

      5. THe entitlement issues aren’t as bad, but Manhattan is as well-served by public transit as any location in the Western hemisphere, and has an absurd amount of “free” street parking which is in very high demand and produces a lot of traffic-snarling cruising.

        Actually Manhattan doesn’t have much free street parking, but you wouldn’t know that by how much locals complain about it. The biggest winers are residents of Staten Island & not the suburbanites as one might expect. Most suburbanites like myself take the train or in the case of New Jersey, take the bus as well.

      6. d.p.: actually, there are jackasses in Brooklyn and Queens who act like they own the street parking space in front of their house. Lots of them. I’ve read several recent articles about ’em.

      7. Breezy Point & Bay Terrace & Bergen Beach = outliers.

        I will admit, though, that on one NYC trip involving a stop in rural Jersey (and thus a car), it was quite the thrill to snag 72 uninterrupted hours of “free” parking right at Central Park West and 60-somethingth. That’s the kind of coup you’ll tell your grandkids about.

    2. Come on, Rapid. Don’t you think that for every angry editorial in a good cause, there aren’t a hundred furious ones claiming discrimination against bad ones? Like linear parking lots with Interstate Highway shields? Goes back to just before the Civil War, where the slavers were calling Lincoln a tyrant for trying to make them stop tyrannizing slaves.

      Agree, though about the futility of long term anger for achieving any positive cause. Like meth, jolt of energy comes at the price of long term exhaustion. Any self-defense instructor will tell you that losing your temper always makes you lose the fight. So correct deliberate goal for any editorial is to make the other side get mad.

      For that goal, contagious laughter aimed at the enemy drives them the maddest. So furious editorials should lighten up. Too bad, however, that Don Martin doesn’t cartoon anymore by reason of being dead. Transit enemies deserve to be depicted with tongues flying out like party favors and huge hinged feet. And names like Fester Bestertester.


  3. This is silly. One can do that with anything. Your “Free” Afternoon at the Park Costs Taxpayers (Blank). Your “Free” Bike Ride Into Work Costs Taxpayers (Blank). Or, Your “$2.25” Bus Ride Costs Car Owners (Blank).

    It’s part of the deal. Transit users mooch off of, and are dependent on car owners to subsidize their transportation, and one of the few perks the sugar daddy car owner gets is free parking in certain places. People, stop being ungrateful. They pay your way and foot much of the bill for public transit. Stop your collective whining and simply thank them for helping you.

    1. In this town, public transit is paid for by sales tax. And roads are paid for mostly with property tax. Not clear to me how car owners are subsidizing much of anything.

      1. Yes, sales taxes on cars. Those are one of many many things we charge sales tax on. Would you care to make a back of the envelope calculation as to what percentage of the total sales tax take is from cars? Cause that might let you make a judgment as to how much direct support sales of cars give to transit. Which is what you’re trying to assert. My wild guess would be a percent or two.

      2. The percentage of sales tax which is from cars is actually rather high. They’re the most expensive item which is routinely subject to sales tax. (Houses are exempt, stocks and bonds are exempt, etc.)

        I did some research. NADA/CAR thinks that Washington state collected about $338 million in sales taxes on new automobiles in 2010, and another $212 million on used cars. The state says that it collected $6,876 million in sales taxes total in 2010. So that’s about 8% of the sales taxes.

        The real question is why houses, stocks, bonds, etc. are exempt from sales tax. I guess you pay property tax on houses, so that more than makes up for the lack of sales tax. But stocks and bonds are kind of a notable exemption.

      3. Of course, the sales taxes on cars don’t even come *close* to paying for the roads. I find that fuel taxes and license fees amounted to roughly $2,536 billion in Washington State in 2012. Add the sales taxes to that (yeah, I know, different year) and you’re around $3,086 million.

        The *state* budget for highways, licensing, and patrols in 2012 is around $6,598 million (2012 numbers). Taxes on motor vehicles pay for less than HALF of it. And that doesn’t even include any of the local funding for local roads and streets.

        Local municipailities are subsidizing motorists *extremely* heavily, since they don’t get most of the motorist-specific tax money (no fuel tax, license fee, etc.)

        Admittedly, most of the state funding (~$4800 million) is for “highway improvement” projects. If highway improvements were STOPPED ENTIRELY, it might be possible for motorists to pay their own way for maintaining the existing roads. Though the state would have to transfer lots of money to municipalities to cover the local roads.

      4. From what I have read, one of the big annoyances by some environmental groups is that coal is exempt from sales taxes, but natural gas is not. Thus, a significant incentive to keep the plant in Centralia burning coal rather than convert to natural gas.

        So, when you start to include industrial and commercial goods, I’m not sure that autos are necessarily the largest ticket item that are subject to sales taxes. Raw steel products are probably extremely high on the list in terms of sheer volume and dollar value.

        Of course, those that have to pay taxes on that type of thing can usually find a way to write off the state income tax portion on the federal income tax return.

      5. Glenn: confusingly, *wholesale sales are almost never subject to sales tax*. Only retail, “final use” sales are. So raw steel? Almost always exempt. The final “I am buying a gas turbine” may sometimes be subject to sales tax, but generally, all the components of it being bought by the manufacturer are exempt from sales tax.

        More confusingly, most “capital assets” are also usually exempt from sales tax. So the gas turbine, bought by a power company, is probably *also* exempt from sales tax…

        In general, industrial and commercial operations aren’t paying sales tax on their purchases.

    2. I actually think following all the costs of public services would be a great idea. That way we could have a clear picture of what we’re subsidizing and evaluate if such subsidies makes sense in the larger societal context. Some subsidies, at least initially, I think we should support, like buses. Buses are an important social welfare. Other things I think shouldn’t be subsidized, like ferries. Why does the state give money to move cars to and from those islands? The people making the trip should pay for it and that would just be part of the cost of living on the island. Some things I think need sin tax, like cars. Not only shouldn’t we be subsidizing cars, we should be taxing them in excess of the direct associated costs because of all their externalities. To name a few, obesity in a country where the number one killer is heart disease; particulate pollution in the city air we all breath; carbon emission; corruption of foreign politics for oil. Those are just the car problems off the top of my head. We need to make the individual cost of driving in line with their greater impac. (Car tax should at least cover the cost of the Iraq war).

      But without good numbers on public service costs and impacts, we really can’t even begin to weigh the worth of our public policy. Instead we’re just a bunch of opinionated people squawking like chickens.

      1. If you want people to pay the true cost of services, then you need to support a competitive market for said services. I guarantee you that the “true” cost is lower than the cost incurred by various monopolistic public agencies that are controlled by unions who take full advantage of the lack of competition.

      2. There is NO sane way to have “competition” in *natural-monopoly* situations like transportation (including roads) and telecommunications and fire protection. It just doesn’t work.

        They have to be monopolies. This is because of network effects.

        Given that we’re stuck with monopolies in areas like roads, telecommunications, and fire protection, monopolies run by elected governments are consistently better than unaccountable private corporate monopolies.

      3. @Kevin C
        I wasn’t suggesting “people… pay the true cost of services”. I was saying the costs of supplying services should be one of the things we consider when deciding public policy. Even though we sometimes hear the gross cost of some service, we rarely hear about the cost per user, or the net service cost as a percentage of the total budget or as a percentage of the budget for all services in the same catagory. Those are things everyone should know when considering public policy. Unfortunately, informing oneself of such crucial information generally seems to involve being a very competent researcher, something I’m not.

        Completely agree.

      4. We used to tax cars a lot more, then Tim Eyman came around with I-695 and destroyed the pool of money that was used to maintain roads and ferries. People will always want something for nothing and now those same people that voted for I-695 are now groaning about the horrible roads in Washington.

    3. I’m afraid I’ll have to agree with Sam’s sentiment here. I think it is not particularly useful to do transactional analysis on items in the commonweal except in the abstract of some measure of public accountability. But suggesting that long held relationships to land use should not suddenly be attacked as wasteful or some other form of collective scorn.

      In the obverse you could engage in the libertarian fantasy of tollgating EVERYTHING after it has been privatized. You want to move your car 100 feet? toll please. You want to turn the corner? Toll please. You want to go over this bridge? You want to walk on this sidewalk? Toll please. etc. etc. etc.

      Also remember that persons not particularly amenable to public transit point out the $36/rider subsidy that North Sounder spends to move passengers. While it is a number that is a measure of efficiency.

      And I’ll say it. Our built environment was built for cars. It is not going away anytime in our lifetimes. While the future of cities is more dense and walkable, you don’t accomplish that by attacking the very foundation that people live by today by even suggesting that streets, designed for cars are suddenly not appropriate for them.

      As a practical political policy, honey always goes farther than bitter porridge…

  4. We could remove all on-street parking Downtown tomorrow and we wouldn’t have a shortage. PSRC data shows that 40+% of all parking downtown goes unused every day. Off-street parking is not better utilized because the city undercuts the private sector on price by only charging $3-4/hour, and because private, off-street lots often have punitive first hour charges of $10+. Removing on-street spaces for bikes, transit, and people on foot should be a high city priority, and I’d support public subsidy of off-street garages to help smooth the transition.

    Parking is also one of the reasons I’ve become a true believer in TNCs such as Lyft/Uber. They may still be cars taking up road space, but by solving the fundamental land use problem of autocentricity (parking), they give us breathing room to densify with abandon while waiting for more and better transit.

    1. But people might have to walk a couple of blocks. That’s just unacceptable.

      1. But that’s just the thing, build more densely and on aggregate they’ll end up walking far less. It amazes me how people will walk 1/8 mile from the end of a surface lot for ‘convenience’ but won’t take an elevator down from a garage to walk across the street.

      2. But people might have to walk a couple of blocks. That’s just unacceptable.

        Oh the humanity, people actually walking in downtown.

        One thing not mentioned regarding surface lots & oversized garages is the urban blight they bring to a neighborhood. I can identify several examples even here in the New York City area such as Headquarters Plaza in the suburban community of morristown NJ – where one single block is blighted do to an oversized parking deck that services this hotel/ office & retail complex. The rest of the downtown area is extremely walkable & loaded with dozens apon dozens of bars & restaurants. Not only that, you don’t need a car to get there as frequent trains serve Morristown from Manhattan as well as Hoboken NJ.

      3. There should be no parking on downtown streets because the laneage is so valuable.

        You would be adding two lanes (either side of street) to crowded avenues.

        Or take one lane and make it a segregated cycletrack…or transit lane.

        Blocking up valuable street with parked cars is ridiculous.

      4. @John Bailo

        Space issues aside, I would think drivers would be more concerned about how much parallel parking slows down the flow of traffic.

      5. I don’t think it’s about walking to the garage. The alternative is potentially parking several blocks away (the only available street space), or circling for half an hour looking for a spot (which wastes your time, to say nothing of the gas). The main reason people say they don’t use garages is the cost, and I think a second reason is the time turning in to the garage and winding around to the space.

        People are extremely cost sensitive about a $10 or $20 garage space. And sometimes it’s truly ridiculous to expect people to pay that; like returning a library book or visiting someone for half an hour or stopping for a quick snack.

        The second reason gets into the time it takes to turn into the garage, get your ticket, and turn-turn-turn to the right level and an open space. And then you have to repeat it on the way out. And some garages have especially tight turns and undersized spaces, which is more aggrevating. Even if you’re going to two stores within walking distance of each other, you may be forbidden from leaving your car in the first garage while going to the second store, so you have to go into one garage, out of it, into another garage, and out of it. By that time the driver may decide to just go instead to a suburban store with free surface parking.

      6. @Charles B

        Great point! In reality they are taking up two lanes on either side — one to park, and one which they block during parking. Even people opening doors on the streetside causes difficulty.

        @Mike Orr

        This is just a cost of doing business. You pay high parking if you want to go to a city ballgame or concert. Same for shopping. What they should be doing instead of a parking fee is taking transit in. And then, if they buy too much stuff to carry, call Uber and use that money for a cab ride instead of parking fee!

      7. So offer drop-off / pick-up spaces so that the people who really can’t walk a couple of blocks can take Uber/Lyft/taxis directly to the door. And put in handicapped placard spaces (for the usual charge, of course) for those for whom that isn’t an option either.

        You don’t want to get rid of parking. The problem is not so much parking, as it is *free* parking.

      8. ” And sometimes it’s truly ridiculous to expect people to pay that; like returning a library book or visiting someone for half an hour or stopping for a quick snack.”

        Don’t you have “15 minute limit” spaces, intended for quick errands? We have those where I live.

      9. I was amazed and astounded the entire decade an a half I worked at Pacific Place how many people would ask if they could/should drive to Westlake Center, Macy’s, Pike Place Market, the Paramount or 5th Avenue Theatres – several people every single day, more in the winter.

  5. “Underground parking, like the massive underground lots being dug out for new apartments all over Seattle, cost much more, on the order of $20,000 or more per space”

    According to the linked article, “Or more” is right! I don’t believe it is possible to build a conventional underground parking garage for less than $20,000 a space:

    “In Washington DC, the underground spots many developers build to comply with these minimum requirements cost between $30,000 and $50,000 each”

    This isn’t surprising. With access ramps, one parking space in a garage takes up over 300 square feet. At the “low” end of $30,000, that’s “only” $100 per square foot, about the same as a 2 to 3 story wood-frame apartment building. The parking garage requires fewer utilities and finishing touches, but the concrete construction is more expensive. $50,000 or more would be the price if parking spaces were sold separately from the housing or commercial space and expected to make back their own financing costs, and turn a small profit.

    To make money off a $50,000 parking space, a private owner would need to charge over $25 per week-day to pay off the investment in 10 years.

    1. With the words “We should try to do something special once a decade” they built a 700 slot parking garage under Director’s Park in downtown Portland. It cost $9.5 million total, and much of that was the underground parking lot. It probably comes to about $13,500 per parking space, if you discount a little bit for the amenities to the park itself on the surface.

      It looks like it might be less expensive to go underground, which maybe is why so many countries seem to do it that way for parking in high density areas.

      1. Glenn,

        Who are “they”? And if “they” are the city, why did they build another lot cater-corner from their own 1/4 empty Smart Park garage?

      2. I may be mistaken, but my understanding is that the $9.5M is just the cost of the park. The underground parking was built privately by the owner of a neighboring building who donated the land on the surface to the city so he could build parking below. The actual cost of the parking is likely private info, but odds are it’s is much more than $9.5m. Those would be remarkably cheap spots at that price.

      3. It’s hard for me to imaging that installing a bunch of paving stones to create the plaza cost $9.5 million
        but then this is the city of Portland we are talking about.

        My impression is that the $1.97 donation from the Schnitzer family was used to develop the surface park, while the rest of the money was used for the underground parking lot, which had to go across the city’s books since the garage was built on the lot after it had been donated to the city.

        But, you are right, it isn’t too clear at least in the wikipedia article.

    2. $25 per weekday is a totally reasonable amount, and if there’s enough demand for parking, a private developer should easily be able to realize that much income.

      Suppose you charge $2 an hour for each space, around the clock. At 60% occupancy you should realize $28.80/day. Think about it.

      1. For a $13,500 parking space, if you charge only $2/hour, and your spaces are occupied only 8 hours a day on weekdays only, but 90% occupied, your payback time is 4 years (not counting maintenance, of course).

        Really, parking can pencil out to be profitable, very easily. Free parking is a problem; but commercial parking WILL continue to be built if you get rid of the free parking.

  6. This ship has already sailed. The issue is not that free parking isn’t free, it’s how best to repurpose the curb lane.

  7. I think my free parking actually makes the city money, every time my neighbors get me ticketed when I haven’t moved my car for 3 days.

    (It’s just a joke, let’s not start arguing about that particular aspect of residential parking policy)

  8. “…$20,000 or more per space… translates into higher construction costs, which means higher rents and less affordable housing.” Wrong. The cost of housing is not determined by the construction cost. The cost is of housing is determined by supply and demand. Given the current demand, a developer decides whether or not to build units at a certain price point, with certain amenities.

    Are you saying the developers are not interested in maximizing their profits, but rather simply recovering their investment? That is not the case.

    It would be more accurate to say, “Expensive housing results in developers being able to spend $20,000 per spot on underground parking.” When there are enough people who can spend $400,000 for a condo, developers will spend $$ to provide the amenities they demand, such as underground parking. Not the other way around.

  9. there’s free parking in downtown Seattle? really? certainly not enough to matter. the underlying premise of this post is false in the local context, as the city extracts the cost of maintaining street parking (according to figures quoted here and in comments) from fees and fines.

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