Thursday, May 31, 2012

Parking is like dining space

Parking is like dining space
In the last post, I posed three analogies aimed at making parking policy easier to understand:
  1. "Parking is an ancillary service like the restrooms in buildings" (this goes with the conventional suburban approach that focuses on minimum parking requirements).
  2. "Parking is local infrastructure like neighborhood public transport facilities" (this goes with the group of approaches that I call 'parking management' which uses a wide variety of parking policy tools).
  3. "Parking is real estate" (this framing goes well with market-oriented thinking on parking, such as Shoupista ideas or Adaptive Parking.)

I ended that post by promising to say more about #3. So here goes.


  • Did objections come to mind when I said parking is real estate? 

I wouldn't blame you. Parking is indeed different from real estate uses like office space, housing or retail space.

The most relevant difference is that we don't visit anywhere for the purpose of parking! We visit to do something else. Parking is secondary to the main things going on at your destination.

So parking is a use of real estate that plays a supporting role to those main activities. Which brings me to the analogy I want to explore today.


  • Parking is like basic dining places within walking distance

By 'basic dining' I mean places for no-fuss eating or drinking (and maybe to sit a while). Notice that I am not comparing parking with fine dining. Going to a fancy restaurant often prompts a special trip. Sometimes it's a long trip.

So the analogy with parking works best for basic dining within walking distance of wherever you happen to be when hunger strikes. If we stick to that kind of basic dining, then like parking, it is incidental to our main business in the area.

But even if such dining plays a supporting role, it is still obviously a use of real estate. And so is parking.


  • A useful analogy?

I think this analogy is useful because it draws attention to important issues that often get forgotten. Basic dining space is similar enough to parking that there are many parallels to explore.

Yet, it is different enough that the parallels make us think. They force us to look at parking with new eyes. If the analogy were perfect there would be no point.

Let's see.


  • Parking is local

Basic dining (that you would not make a special trip for) reminds us that, unlike office space or housing, parking is a highly local concern. It doesn't make sense to talk about the city-wide supply of parking. Basic dining and parking are relevant only to their own vicinities.


  • Parking as real-estate reminds us to think about opportunity cost

This analogy focuses our minds on the opportunity cost of parking areas. The notion of 'real estate' reminds us that parking consumes space. It reminds us of this more forcefully than the ideas of 'infrastructure' (#2) or 'ancillary service' (#1 above) do.


  • This dining space analogy reminds us to think about market prices

Thinking of parking as a use of real-estate like dining space helps draw attention to the market value of the service.

Actually, we sometimes forget the real estate aspect of this when dining too. We sometimes imagine we are paying only for what we consume plus some service. In fact, a large part of a restaurant or cafe bill is real estate costs. Both basic eating out and paid parking have both real estate and service components (of course the proportions are different).


  • It also reminds us that parking is often a business

Viewing parking as real estate like basic dining reminds us that parking is often a commercial enterprise. It prompts the question of why commercial parking is not more common.

The analogy should make us wonder about the wisdom of government subsidised parking and minimum parking requirements. More on these issues below.


  • What about bundled parking?

Basic dining space, like parking, can bundled with other real estate. Examples include your dining room at home or a staff lounge at a workplace.

But that doesn't change the fact that it is still real estate. Similarly, even if we don't pay for parking space explicitly or separately, it is still a use of real estate and it still has value as real estate.


  • What about on-street parking? 

It can be difficult to think of parking at the kerbside as real-estate rather than infrastructure. But I think the dining analogy helps.

For example, the fact that some dining takes place in the streets doesn't change the fact that it is a use of real estate. This is reflected in the fact that most local governments charge fees to allow tables and chairs on footways.

Both on-street parking and street-side dining are uses of  public space for a private purpose. In both cases, it is reasonable to pay some kind of 'rent' for the space.


  • Open-access is a strange way to manage real estate

Suppose a busy commercial area had hundreds of street hawker stalls serving food at plastic tables and chairs under umbrellas on the sidewalks. And suppose these hawkers needed no license and paid no rent to the city for using the space.

That would obviously be a strange way for the city to manage such valuable space. Even if that many hawker stalls were allowed, surely their private use of public space should require some kind of rental payment.

So the dining space analogy reinforces the idea that free on-street parking is an odd thing to allow in busy areas.

Sometimes parking space literally becomes dining space, as in this photo showing San Francisco's parklet program. Photo: Matthew Roth.

  • A real-estate perspective makes some common parking policies seem strange

In the open-access street-side dining situation above, few indoor food outlets would be viable, right? So would a government-subsidized cafeteria be a wise answer to a lack of indoor dining in the area? I doubt it. Yet, many cities try the same trick with parking.

If we allowed hundreds of rent-free street hawker stalls in the streets, would "minimum indoor restaurant requirements" be the answer to the lack of private sector indoor dining? Would such efforts to boost indoor eating space automatically reduce street hawker space very much? Would they make local restaurant businesses more or less profitable? Ridiculous, right? Yet the same approach is a centrepiece of parking policy in most cities.

  • So do you see the point of the analogy? Is it a useful way to think about parking?

It is not that we MUST think of parking as real estate. But it can be useful to choose to do so.

It helps us to see mainstream parking policy in a new light (in which some of it looks a bit foolish). It also makes it easier to see the potential for more market-responsiveness in parking.

What do you think?  Does this analogy help you think about parking in new ways? Does it illuminate or confuse?

5 comments

Tuesday, May 29, 2012

Our half-conscious assumptions about parking

Disagreements on parking run deep. Deeper than mere differences over policy.

In fact, you and I may be thinking about parking in fundamentally different ways. We have different analogies in mind even if we don't think about them very clearly.

I think people 'frame' parking in at least three different ways:

1.  "Parking is an ancillary service for each building, like its restrooms"

Many people tend to see parking as an ancillary facility that needs to go with every building site, like fire escapes, plumbing or toilets. With this view, it seems obvious that planners need to make sure buildings have enough, so that there should be no excuse for anyone to do it out in the streets. It is the problem of 'spillover' that this approach is most concerned to prevent. As I have written before, this is the way the conventional suburban approach sees parking. It seems natural in places where buildings are isolated from each other, as they often are in auto-oriented suburban areas.

2.  "Parking is infrastructure for its area, like local public transport facilities"

Others see parking as 'infrastructure' akin to local public transport facilities, such as stops, shelters, priority lanes and depots. This is infrastructure for the whole locality, not for specific buildings as in the restroom perspective above. It suits walkable, park-once districts. With parking as district infrastructure, spillover is not seen as a big worry. Nevertheless, with this perspective, parking needs to be planned. As with transit facilities, parking can be overwhelmed by demand or can be underutilized. And like transit, it is often seen as a tool for achieving various urban policy goals. So this view tends to put responsibility for parking outcomes onto government. I call this diverse family of approaches 'parking management' and it is common in inner city areas, at least in Western countries.

3.  "Parking is real estate"

A third perspective sees parking as real estate, or a use of real estate space. This points toward a more market-oriented mindset on parking. Like number 2 above, this also suits walkable park-once districts. I will explain this analogy in more detail in my next post. [Update: here is the next post]

So we have a paradigm difference on our hands, with different people seeing parking in different ways.

These analogies are not perfect of course. Analogies never are. You will easily think of lots of objections. But I still think they are helpful. They highlight the contrasts between various mental frameworks for thinking about parking and parking policy. It would be so much better if we could all be more explicit about how we 'frame' parking.

3 comments

Wednesday, May 23, 2012

"Gangsters" in Indonesian parking

"Gangsters" in Indonesian parking
Motorists often gripe that parking in their city is run by 'extortionate gangsters'. But if you live in Indonesia you may mean it literally.

A dramatic feature of parking in Indonesia's parking scene is the alleged role of thugs or gangsters.

I have posted before about informal or illegal on-street parking fee collectors. But today I am talking about gangsters in the FORMAL parking fee collection system which applies to on-street parking in most Indonesian cities.

It is a strange situation. Let me try to explain.

Paying for parking is widespread across Indonesian cities, although the prices are low (even taking local purchasing power into account). You can typically park a car in the street for many hours for a flat fee of 2000 rupiah (Rp). That's about 20 US cents.  These small amounts are enough to support a complicated rent-seeking ecosystem.

[On the bright side, at least Indonesian motorists don't expect free parking. This will be helpful as parking reform proceeds in the future.]

The parking fees are collected by parking attendants  (‘juru parkir’ or jukir) under a system of individual contracts for each attendant’s tiny patch (the short stretch of street that one attendant can handle). The 'Indonesian Policy Wonk' blog (by a recent student of mine!) provides a colourful description of Jakarta's parking attendants and some useful background.

"Terus terus terus!" (keep going! keep going!)
Each little patch is associated with an attendant licence or permission letter (‘surat izin’). In theory, this piece of paper entitles only the attendant and two named assistants to collect parking fees on this patch. They get an official vest, which would be blue in Jakarta for example, and orange in Palembang. Usually this system is overseen by the transport department of the local government.

Now here comes the key point.

In reality, most of the actual parking attendants out in the streets and their assistants are NOT the same people as listed on the licenses.

You may have guessed what is coming. The people with the formal permission letters are in practice usually a kind of gangster. The Indonesian word is ‘preman’. Australian academic, Ian Wilson, provides more insight on Jakarta's preman world.

These parking preman play a rent-seeking or protection racket-type role. They rent out their patch to the actual on-street attendants in return for a substantial cut of the takings.

The real attendants also have to pass on revenue to the city. In theory, the attendants are supposed to issue tickets to motorists and pass on revenue based on ticket stubs. Of course, without strict oversight, the attendants generally fail to give a ticket and motorists no longer expect one.

So in practice, local governments tend to simply make an estimate of the revenue they can get from each patch. This seems to be partly based on surveys and partly on a negotiation over what the attendant can afford. Presumably, the officials pragmatically take into account the fact that the attendant has to pay the preman too. The street attendants themselves apparently end up with a tiny income well below the national minimum wage guideline.

Why is there no action against the gangsters? After all, the role of the preman is hardly any secret. The city transport departments are well aware of what is going on. So why don't they just make sure the attendants in the street get the licenses and not the rent-seekers? Unfortunately, I am told that it is not so easy. The preman have powerful ‘friends’ and protectors.

For the same reason, changing the payments system will be difficult.

When Jakarta tried to install parking meters a few years ago, they were smashed up within weeks. An attempt to encourage motorists to demand receipts from parking attendants (by offering them the 5th one free of charge) fizzled out with low uptake. In 2005 ITDP reported that the 'interests' behind parking attendants were a strong force against change in Yogyakarta's Malioboro commercial district.

It is no surprise then that revenue from on-street parking in Indonesian cities is abysmally low.  Even more importantly, on-street parking pricing can't be a useful parking management tool in such a situation. Time-based fees on-street cannot easily be implemented. Any use of pricing for policy objectives or demand-management seems out of the question.

Progress in the on-street parking scene in Indonesia will require drastic changes but it won't be easy. Your suggestions welcome!

This post is based on what I know about just two or three Indonesian cities. Details probably vary widely around the country. So please correct me via comments if my understanding of these murky issues falls short. You may know better about the situation somewhere in this big country of 200 million people or more.

1 comment

Friday, May 18, 2012

More on the on-site parking scourge

More on the on-site parking scourge
I see that John Van Horn of Parking Today has made some sharp observations on my previous post (Onsite Parking: The Scourge of America's Commercial Districts, which highlighted the dangers of minimum on-site parking requirements for dense commercial centres).  

Thanks for the plug John!

He makes this important point:
There are a couple of problems with the Planetzen piece Paul links, the major one is that the author feels that the solution to problems is public provided parking (either on or off street) and that this should be paid for by local merchants by taxing them for the parking spaces they aren’t required to have. (Peter Guest comments on the fiasco this caused in the UK in June’s PT, on the streets – or at least the ‘net — next week.)
I tend to agree with Don Shoup that the free market is the best approach here. If parking is needed, and if the on street spaces are properly priced, then off street garages would be a viable commercial venture and the local city need not be involved. However if private business must compete with taxpayer subsidized or free parking supplied by the city, there is no reason for the private sector to move in and provide the service.
I agree. And I am looking forward to reading Peter Guest's comments on the UK example. 

I also want to clarify my own stance on this, in case I wasn't clear enough. 

When I suggested "public parking" as a key part of the solution I was referring to parking that is OPEN TO THE PUBLIC, not necessarily parking provided by the public sector! A preference for parking to be open to the public is part of the agenda that I am calling 'Adaptive Parking'. 

I was also worried about Mott Smith's claim that business districts still need plentiful free parking. Regular readers of Reinventing Parking know that I disagree with him on that!

On the other hand, I am not too rigid about it either. In many cities the political process is not ready to stop promoting parking supply. If that is your situation, then public-sector provided parking is probably the lesser of two evils.

In other words, if you really must promote more parking supply than would be justified by parking fees alone, then I would at least prefer it to be "public" parking (as in OPEN to the PUBLIC) built by a local government rather than "private" parking (as in NOT open to the public, 'customers only', 'tenants only', etc.).

An example of public-sector public parking in Buenos Aires. Underground is expensive, so the construction had to be subsidized. But if you insist on squeezing more parking into such places, this kind is better than requiring on-site parking with every building in an area like this. 

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