For as long as we've had cars in cities, we have needed to find places to park them. In inner-city areas where land is highly valued, and there is a strong need for high amenity spaces, allocating land to store private vehicles can be a very inefficient use of land.
Given the depth of car ownership and use in our cities, the need to cater to car parking in urban areas is a reality that cannot be ignored. How then should we manage the allocation of valuable urban land for car parking in a way that provides sufficient parking in an area, while reducing demand overall and discouraging use of single-occupancy vehicle modes?
Part of the answer can be found in paid parking and the economics behind it.
The rationale for paid parking
There are two key reasons for councils to implement paid parking in inner-city municipalities:
- To achieve an optimum level of parking occupancy and turnover. This ensures adequate access to parking for short-term visitors in appropriate locations (with consequent benefits for traders), while promoting efficient use of land, active travel and public transport use.
- To address parking behaviour of central city workers. This can mean using paid parking to discourage workers from parking in inner-city municipalities and then travelling into the central city, or to ensure that a fair contribution is made for the utilisation of parking infrastructure and the introduction of additional congestion in host municipalities.
A related benefit of paid parking is the revenues raised by fees, which councils can use to fund other projects and services, including parking infrastructure, roads, public realm upgrades and sustainable transport initiatives. From an enforcement perspective, paid parking typically results in better adherence to parking restrictions than time-based restrictions alone.
In some cases, paid parking can also offer a more practical solution than time-based restrictions. An example of this may be where a parking space situated outside a café does not yield the optimal turnover, but imposing stronger time restrictions – e.g. from 2-hour to 1-hour parking – may not allow patrons enough time at the café. Introducing parking fees in this instance would increase turnover while avoiding undermining the use value of the parking space for café visitors.
Optimal turnover
What, then, is the optimal turnover for a parking space? Is the ideal occupancy rate for a space 100 per cent, such that the moment a parking space is vacated another car takes its place?
Research suggests the optimal occupancy rate is somewhat lower.
Academic Donald Shoup argues that the ideal occupancy rate for on-street parking is 85 per cent. [1] This means that for every 20 parking spaces, 3 will be vacant at any one time – or roughly 1 in every 8 spaces. He asserts that this proportion represents an efficient use of a parking resource and minimises the externalities associated with ‘cruising’ for parking. These externalities can include increased traffic congestion, vehicle emissions, and reduced safety. This concept is illustrated in the figure below.
