Giving workers the option to trade free parking for hard cash will reduce traffic congestion and deliver healthier air and happier people, says an urban planning expert at the University of California, Los Angeles.
As New York City prepares to implement the first congestion pricing program in the United States, it may want to consider the multiple benefits of employer-paid parking cash outs, writes urban planning professor Donald Shoup, of the Luskin School of Public Affairs at UCLA, in a post for Planetizen.
Possibly as soon as this June, drivers will be required to pay a US$15 toll to enter the Central Business District (CBD) in Manhattan. The aim is to reduce congestion, but that goal stands to be undermined by the common phenomenon of employer-paid parking, Shoup says.
“The average price of off-street parking in the CBD is $655 a month,” he writes. “If an employer pays for employees’ parking at work, the subsidy for a commuter who drives to work 20 days a month is $34.50 a day, more than twice the $15 toll.”
Shoup says New York City would do well to follow the lead of Washington, D.C., which now requires employers who offer paid parking to give their employees the option of receiving the cash value of that parking instead.
“Called parking cash out, this policy rewards all the alternatives to solo driving,” including transit and carpooling, he explains. Some commuters might even take the extra dollars and “rent a more expensive apartment within walking or biking distance of work.”
The cash savings wouldbe considerable for those who give up routinely driving to work alone, Shoup adds. “Commuters who continue driving to work will pay a congestion toll of $15 a day,” but “those who cash out free parking will get $34.50 a day and will not pay the $15 toll,” for a total daily saving of $49.50.
“Parking cash out will, therefore, provide a far greater disincentive to drive than the congestion toll alone,” he writes. And it will produce a significant improvement in NYC, where an estimated 1.1 million commuters drive alone into the city each days. Offering parking cash out on a monthly basis will reduce commuter vehicle travel by 3%, while cashing out daily will cut commuter travel by 9%, Shoup estimates, citing a 2023 study by the U.S. Department of Transportation.
