Blogging Bayport Alameda

November 25, 2013

Just right

Filed under: Alameda, Alameda Point, Development — Lauren Do @ 6:05 am

So for those that have difficulty wrapping their heads around the concept that parking has some sort of fixed cost.  Even parking that is “free” as subsidized by your friendly local big box store or shopping mall.  There is this great tool that was created by King County is Washington (think Seattle metro area) that shows how much it costs to build parking in their area and how much less you can develop for if you lower the parking minimums per development.   This is for multi family residential housing but gives an idea of how much parking spaces cost and that the cost must be absorbed and passed along somewhere.

The tool is Right Size Parking and can be found at the web address I linked to.   Knowing nothing about the Seattle Metro area I chose Mercer Island because, well, it’s an island.

I kept all the pre set values that were automatically inputed into the tool and this was the result:

Screen Shot 2013-11-22 at 3.52.02 PM

So the monthly cost for surface level parking, the value just to purchase enough land to meet the demand to provide 1.21 parking spaces per unit is $11,611,467,117.  Because everyone just assumes that all households (units) have at least one car.   The monthly cost of maintenance and ownership per unit is $103.  The cost to build a parking structure is even higher, but we don’t really do structure parking around here so I’m just going to ignore that number for now.

The fun thing about this tool is that you can input different numbers for parking spaces per unit to see how the overall cost of parking decreases.

If you are to drop the number of spaces required per unit you can see how the number drops dramatically for both the land acquisition and the monthly cost per unit:

Screen Shot 2013-11-22 at 3.58.23 PM

And if you halve the number of required parking spaces:

Screen Shot 2013-11-22 at 3.59.49 PM

In lessons learned from other cities, the whole idea of market rate parking in downtown areas is credited with revitalizing Old Town Pasadena, and yes Donald Shoup is featured in the article:

Nowhere will they feel more at ease than in the original business district, almost without exception called Old Town Pasadena on the street, but now zealously branded, for whatever reason, as Old Pasadena. Concentrated in the blocks around Colorado Boulevard and Fair Oaks Avenue, this historic building-rich core — called, in promotional materials, “The Real Downtown,” — has in recent years reinvented itself as a walking-friendly shopping district, thick with all manner of buying opportunities.

In Pasadena, the city had no parking meters, and wanted to put them into Old Pasadena. It was built largely before 1930, and it didn’t have much off-street parking. The on-street parking was occupied by the merchants and employees, who then complained about the lack of parking for customers.”

This at first sounds like a classically intractable American urban situation. “The city wanted to put in parking meters. The merchants said, ‘No way, it’ll chase away the few customers we have.’” And yet, after the debate had burned a couple years, “finally the city said, ‘If we put in the parking meters, we’ll spend all the meter revenue for public infrastructure and services in Old Pasadena. The merchants said, ‘That’s different! Why didn’t you tell us that? Let’s run the meters ’til midnight. Let’s run ‘em on Sunday. Let’s charge a high price.’ They knew the money coming in would come right out the other side and fix their sidewalks, put in new street furniture, put in historic streetlights, put in new street trees, clean up the alleys — just about everything a city can to do fix up the public part of a neighborhood. Once the city had done that, the property owners began to restore their buildings, which didn’t make sense beforehand. A lot of new restaurants and stores opened. And Pasadena had $700,000 a year, still, in parking revenue to steam-clean the sidewalks twice a month, to have added police protection, to remove graffiti every night. Now 30,000 or 40,000 people go to Pasadena to walk around every weekend.

And from a different article:

Meter pricing in Old Pasadena is managed to reflect parking demand, a best practice in parking policy. More than 1,200 meters are enforced seven days a week from 11 a.m. to 8 p.m. Sunday through Thursday, and 11 a.m. to midnight Fridays and Saturdays. Parking is not allowed between 2 a.m. and 6 a.m. The meter cost varies by location, with $1.25 per hour in the heart of Old Pasadena, where most people visit, and 75 cents per hour elsewhere. The meters do not have time restrictions because the fees encourage relatively quick parking spot turnover. Even if a customer chooses to park on-street for an extended period, the area still benefits from both the meter revenue and because the customer is likely spending more money in Old Pasadena businesses. It’s notable that the meter rates work in tandem with Old Pasadena’s publicly owned garages, which are open 24/7 and are free for the first 90 minutes and cost $2 per hour thereafter, with a $6 daily maximum. These rates make the garages more economical than on-street for long-term parking, which in turn eases traffic congestion and makes more on-street spots available for those who want them most.

Finally, Donald Shoup suggests that for parking in business corridors that the “Goldilocks” method of not too high but not too low is the best method and cites 15% space availability as the best measure for how appropriately parking is priced.   That is currently what SF Park in San Francisco strives for and — from all accounts — it appears to be working.

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24 Comments »

  1. Transform, based in Oakland, has performed many studies on this issue through their GreenTrip and other programs. Details on several local housing projects that have lowered the cost of providing housing by lowering onsite parking requirements and implementing incentives to use transit instead are here: http://www.transformca.org/GreenTRIP

    Comment by Jon Spangler — November 25, 2013 @ 8:25 am

  2. Interesting scenario in Pasadena. Haven’t spent a lot of time in LA area, but I happen to have walked this district a couple times in last ten years and the article description rings true. BTW- I like the idea of no time limits on meters and I’m glad there is a scenario which debunks the argument time limits are a must. Limits don’t change the length of time I need to do the business , they just frustrate a consumer by making it hard to maintain meter time and/or avoid a ticket which more than total meter cost is a big disincentive.

    This tiered pricing would seem to reflect basic supply and demand principles which supporters of free market should support. This article makes it seem the way it was applied in Pasadena to be symbiotic in a positive way. If you try to cut costs of parking you probably increase costs in another area, like squeezing a balloon. bottom line is that all costs trickle down to consumers eventually. Nice to think that Pasadena has had such a win/win if these selected paragraphs are representative.

    It’s not like this isn’t obvious, but the cost of shop lifting , for example, is embedded in the price we pay at Safeway for Twinkies. So there is no free lunch, it’s just a matter of following the money and determining where the buck has stopped or who is left holding the bag, so to speak. Sometimes it’s the public and the profit making entity walks away with the subsidy. Even though the parking garage has a fee, citizens are also paying for bonds.

    **This veers into a tangent, but we”ve debated here about indirect public benefits from the garage and theater project over the long run. If garage fees don’t cover bond interest and theater sales tax on popcorn ( ’cause ticket sales don’t derive tax $) don’t cover it either, the vitality of the epicenter of Central and Park is still hard to knock and I think it must contribute to over all property taxes by making Alameda a really attractive place to live, thus sustaining home values ( “Oh the horror”). We pay tax for sewers which don’t create a direct positive tax flow, but do have a very tangible benefit. Maybe the amount of public bucks sunk into Park Street have a similar benefit even if we don’t have a direct net increase in GF tax dollars.

    Comment by MI — November 25, 2013 @ 4:06 pm

  3. The theater & garage very plainly & tangibly benefit PSBA members. The benefits to the taxpayers are very hard to measure, if they exist at all, and are not enjoyed citywide, as police & fire are. These alleged benefits come at a cost of several million per year, which negatively impacts public services. If we were to poll citizens about the value of police/fire, sewers and parks vs. a movie house and a fat gift to PSBA, which uses of tax dollars would win, do you suppose?

    Comment by dave — November 25, 2013 @ 4:17 pm

  4. 3. it does matter how your ask the question or frame the issue doesn’t it? I don’t think it is as clear as movies versus cops. what is it was sewers versus firemen? you like those odds?

    Comment by MI — November 25, 2013 @ 8:01 pm

  5. Clear as mud to me. I’d have to know a lot more about how figures arrived at for this to make sense. Can’t say I think P W has spent $100 p/m on my area of the street. Even if it has, charging me $2.00+ an hour added to the cost of lunch on Park St, plus the aggravation of finding a parking place I can walk from, means I will be over budget. So, no more lunch out. For me, it’s not about what the city can charge, it’s about what I can afford physically as well as financially.

    Comment by Li_ — November 25, 2013 @ 10:15 pm

  6. 4.

    Tax dollars are for public purposes. These are generally understood to be essential public services delivered to the entire population; services not uniformally delivered by the free market. The market doesn’t provide uniform public safety, so the city (or county/township/village or whatever) taxes & provides. Same for parks and sewers which are also not provided uniformally by the market.

    Entertainment, however, IS amply provided by free enterprise. Tons & tons of it, many would say too much. Moreover, it is not an essential offering. The alleged property value benefits you cite (dream?) only really apply to the area nearby. If, and again it’s doubtful, that complex does increase residential values it amounts to a taking of all taxpayers’ money and giving it to a few neighbors.

    If you believe that tax dollars should pad the wallets of a few & provide non-essential entertainment, please state & defend your case.

    Comment by dave — November 26, 2013 @ 6:47 am

  7. “The benefits to the taxpayers are very hard to measure, if they exist at all, and are not enjoyed Citywide”

    Of course they exist. Until a few years ago before the theater went in, Park Street was a ghost town. Try to find a parking space in the evenings or on the week-end these days. Park Street has become a destination with people coming from all over the Bay Area to shop and eat, and it will only get better as new shops and restaurants open.

    Park Street is to Alameda, like College Ave. is to Rockridge, and University Ave. is to Palo Alto, and Solano Ave. is to Albany. It is in our interest to invest in Park Street!

    Comment by Karen Bey — November 26, 2013 @ 8:39 am

  8. The city spends several times more on debt service for the project than it gains in sales tax revenue from it. Property tax revenue has not appreciably increased in the area nearby, which would be the case if it was making the town so desirable a destination.

    Kyle Conner has been the primary beneficiary of this spending, with PSBA membership gaining as well.

    The vicinity of Park & Central is certainly nicer than it used to be, but I submit that 6MM per year of property tax revenue is not a proper use of public funds. The city should not be in the ambience buisness, under any circumstances, let alone the current ones in which parks are fraying and public safety cuts loom in the near future.

    Sorrry to inject reality into this, but no amount of tinsel & lipstick can change what is a lousy deal and an indefensible use of tax dollars.

    Comment by dave — November 26, 2013 @ 9:01 am

  9. So, Park street was a troubled asset prior to the theater et al restoration and other give-away investment infusions from the city. Park St is now thriving but the city isn’t getting its money back. Just like TARP on a small scale. Kick the financial liability down the road and live large now. Too bad the city can’t print its own money.

    Comment by Jack Richard — November 26, 2013 @ 9:38 am

  10. Dave, I look at the investment and development of Park Street as a long term project with the return on our investment improving over time as the district builds up its sales tax base. I’m willing to wait for that to happen, I guess you’re not!

    Comment by Karen Bey — November 26, 2013 @ 9:44 am

  11. 9

    Get informed on TARP.

    10

    Give me your numbers. When will it ever pay off? Serious question. What is the schedule?

    Comment by dave — November 26, 2013 @ 9:57 am

  12. Quality of life for those of us who frequent the Park Street business district has gone up considerably. The movie theater restoration is a point of great pride and a benefit for many throughout the city as well. There are dividends that don’t always appear on a balance sheet. As Ocsar Wilde would say, you naysayers, “know the price of everything and the value of nothing.”

    Comment by Denise Shelton — November 26, 2013 @ 11:53 am

  13. If you believe the city should spend millions on entertainment, to the detriment of public services, say so. Then defend and justify that idea. State clearly how much you are willing to let public services slide so that Kyle Conner can make a profit.

    I don’t bring this topic up any longer, it is a fait accompli, but when others do, as Mark above, I clearly state what is wrong with it and why. So far, years into this controversy, not one single person has ever been able to justify it beyond glittering platitudes about how nice it is. No one has EVER put together a cogent defense of the use of property tax dollars for movies.

    There are two problems here. First is the fact of the math. It will never be a financial benefit to those who paid (ie US). Numerous times I have clearly demonstrated why. No one has ever put up numbers that show it will pay, as MI and KB claim it will “someday” though neither has yet demonstrated how or when. Second is the use of tax dollars to benefit private parties for non-essential purposes. This is more opinion than fact, but it is a very widely held opinion, and one that is difficult to credibly counter. I ask bluntly: is the city in the commercial ambience business? Should it gives millions of dollars to an entertainment business at the expense of public purposes?

    Comment by dave — November 26, 2013 @ 12:14 pm

  14. 13. The City most definitely is in the commercial ambience business. Prospective shoppers and homeowners, who contribute to the City’s tax revenue, are attracted to places that are nice to shop and live. The police and firefighters are doing a great job. The parks, pools, and schools could use some help with maintenance but, overall, they beat the hell out of what’s available in many surrounding areas. Your argument could just as easily be made about any number of things. Just because you personally don’t value the Park Street area and its businesses, doesn’t mean they don’t have value to others. In any case, you seem to have missed my point. I don’t deny that the theatre project is costing the City. I do think that it’s worth it. There are more available jobs in the area because of it, more for the residents to do in Alameda, more reason to frequent our restaurants for an evening out instead of going to Oakland or Emeryville to get dinner and a show, and a thriving, attractive environment for everyone who passes through. If you only see value in dollars and cents as they relate to the City budget, then I guess it figures that you see no value in this. We disagree. I think the theatre project is an asset to the public in general, you don’t. Doesn’t make either of us wrong, per se (although I reserve the right to think you are, just as you have the right to think otherwise).

    Comment by Denise Shelton — November 26, 2013 @ 12:31 pm

  15. If the project is “worth it” then show the math. Money is easy to measure. What are your numbers to prove it’s worth it? You seem to think “it’s really nice” and “gee I love movies” are ample justification for a major & unnecessary expense. They aren’t.
    As for the value of the Park St buzz, I don’t ignore it, I simply place public services above bread & circuses. The latter two are well provided by free enterprise, it is not the city’s business to provide them at the expense of public service.

    The value of the city’s mission of providing services to all its residents is hard to measure; what is the value of a fire station or a 911 call? That is difficult to express in dollars and cents in the city’s budget, to use your phrasing. But recall that gifts to PSBA are most assuredly NOT the city’s mission. If such a project is put forth as having some economic and financial benefit, well then dammit, it ought to have a benefit. This project DOES NOT. Never will. Insist that it does if it pleases you, but without evidence, the point is meaningless.

    Comment by dave — November 26, 2013 @ 1:12 pm

  16. @10: “I’m willing to wait for that to happen. I guess you’re not”. How long to wait is long enough? My family has been waiting for 3 generations. My great-grandparents settled here in the 1870′s. They invested in Alameda real estate, mostly in the West End. Neptune Beach came & went. So did the beer gardens. And the Red Trains on Railroad Ave.They sold…In my lifetime, I have seen business after business open on Park Street or Webster or South Shore, sometimes move around the city, but, except for Ole’s, Tucker’s & this last extant Theater, they closed.
    Alameda remains a promise unfulfilled & probably always will be. Park Street is & always has been a money pit. It will be regardless of whether tax dollars are thrown into it.
    So we might as well save the tax dollars for better uses, rather than use them to prop up private enterprise.

    Comment by vigi — November 27, 2013 @ 10:18 am

  17. I’m with Karen and Denise, most people in Alameda are also. Dave you and Vigi can be right as long as you want to be, but the fact is we have a Park St. that citizens wanted and have welcomed. So we’ll be wrong and Happy you can be right and unhappy. Bye the way everyone please have a Happy Thanksgiving.

    Comment by John P. (L) — November 27, 2013 @ 10:29 am

  18. How many of the people who understand how it was financed are happy with it? Ignorance = bliss.

    Comment by dave — November 27, 2013 @ 10:59 am

  19. The approximately 3MM per year in debt service on the project can be viewed this way:

    -Roughly equal to the annual capital expense for streets
    -Roughly 15 cops.
    -Approx 80% of annual parks budget.
    -Approx 150% of the Library budget
    -More than 10X the rent paid by the operator
    -$100 per household
    -Sufficient to close recent budget deficits

    Our streets are in poor shape now. How much better would they be with that extra 3MM? How much safer would we be with a dozen or more extra cops? Maybe the water fountains in the parks might work with some extra funding. And what does it say about a community’s priorities to spend half again as much on movies as libraries?

    But John & Denise love it so it must be a good deal.

    Comment by dave — November 27, 2013 @ 11:35 am

  20. dave, to your list: I’d want to hear from police if they feel understaffed or not. I’m feeling pretty safe. Roads in “poor shape”, really? There are resurfacing projects happening all the time ( and sewer main up grades) on roads which are in far better shape that any of those approaching our bridges from Oakland. Would love to understand details of theater lease and at earliest opportunity make sure City gets max return from theater rent. If union projectionists aren’t needed as in the past great, but I’m not seeing the savings passed through in ticket prices and never have. In fact the opposite, tickets at that theater are always as high as any around and the matinee hours at most other theaters are way better. ( and while I’m ragging on the place, I show up as late as possible to forgo the talking hotdog etc. Sick of that and the ad loop too.) Yeah, more money for parks and libraries, pools and not in this fiscal venue but related to quality of life here, schools..

    Any guess on how much of the $3mm would not be generated without the theater and garage? I know you kinda feel like that figure to be ALL of $3mm because movie tickets aren’t taxable etc., but do you know what the increase in tax increments has been from the entire district since the theater opened? Curious if parking garage fees offset bond interest for that structure if those figures can be sorted out. We were told the tax increments which were flowing back into the redevelopment district before the bond was issued were enough to pay the freight for floating that bond. Maybe the problem is redevelopment itself since all the tax dollars are cycled back into the district anyway, therefore they are trapped there and couldn’t reach your wish list whether this 30 year bond were added to the debt or not. Is that correct or not.

    I thought I read a letter in the paper from City Hall that instead of exceeding projected budget we squeaked under by about a million. Not that we can’t use more money, just saying with tightened belt they have managed to stay in the black, yeah?

    Comment by MI — November 27, 2013 @ 12:17 pm

  21. Quick now, more another day (this subject is a buzz kill and I have 21 guests today):

    The police number is just an illustration. We could have that many more, or looked at another way, if we lost 3MM worth, how would that be? I feel safe also, I wouldn’t live here if not, but I’d also be happier with more police. I am a law-n-order type guy, probably have a much lower tolerance for incidents than you.

    The city’s own reports, including the FSC on which I served, go into great detail about deferred maintenance & sub-standard condition of our streets. Yes, repaving happens. Point is we could be doing more, if.

    Schools are perhaps the #1 indicator of values, and that is of course a different subject, but if they aren’t #1 they are tied for first with crime/safety, which is very germane here. The school district is doing pretty well, considering severe funding constraints (something like only 70% of national avg and this is a high cost area in which to operate) but the city’s fiscal management leaves much to be desired.

    Your question about the increment is very much on point. I do not know the precise answer. It *may* be buried in the CAFR but I have not seen it on previous perusals. However given the static and slight downward trend in prop tax revs last few years, I see no evidence of a theater related pickup. Prop taxes are a year in arrears so the last couple years rally in prices hasn’t been seen yet (on my bill it has, but not sure if that holds elsewhere due to P13 etc) but while a definitive NO cannot be given, there is no reason to suspect a yes either.

    The budget is only barely balanced and that was accomplished with some accounting legerdemain, and in any case we have been running deficits for several yeasr that would have been covered by the 3MM.

    The increments generated do indeed cover the debt service, easily in fact, but that is not the point. The point is that the city has left its purview of providing public services and instead spent 3MM per year on a commercial real estate venture which produces significant negative returns, and significantly benefits a private entity. Those are both incontrovertibly true and negative. All I get in response in this thread is “we love movies:)”.

    Comment by dave — November 28, 2013 @ 7:30 am

  22. Have a Happy Blissful Thankgiving Dave. 21 people, omg.

    Comment by John P. (L) — November 28, 2013 @ 8:49 am

  23. 21. no dave, you’ve gotten much more than”we love movies” and I’d maintain that the question about tax increments you credit as being on point is evidence of that. Incidentally, I boycotted the GD theater for close to two years just because the management bugged me, and still does, but that’s a digression. A lot of folks love movies and keeping their butts on the island has beneficial effects, economic, environmental etc. I’m not equipped to substantiate all that statistically, but the negatives you keep repeating also have limitations on refuting our supposedly naive theory of theater based prosperity (I’m being a little facetious with that last terminology). The theater bond is 30 years and I think perhaps the window to measure positive effects of theater and other redevelopment should perhaps be similar time line.

    This link below is in one sense a very broad tangent from redevelopment or bonds, and parking fees, but in a period when people may have time to reflect while they digest, it is great food for thought in big picture realm of economics. If one invests the time to view the entire thing they will observe, or should, that it touches on many of the issues we discuss here. One thing I really appreciate is the style of Canadian media (depth of interview) but another thing is that this guy ( Jaron Lanier) doesn’t try to sell his POV as ultimate bottom line, just worth considering. He also qualifies it’s value for consideration by discussing not just economic models, but history of his prediction and his qualifications, i.e. ground breaking involvement in the tech sector he is critiquing. His references are also grounded in historical examples like the evolution of wage labor, something you won’t get from the likes of that supposed Whiz Kid Zuckerberg.

    Comment by MI — November 29, 2013 @ 4:06 pm

  24. 23

    City property taxes have been running in the 22/23MM range the last few years and are projected to increase modestly, slightly above the Prop 13 2% level. This makes sense, as older property worth far above assessed value will increase at 2% and when such do sell they get reassessed to a realistic (at least in year 1) figure.

    That is important to note: in most years, the city will enjoy a ~2% increase simply by standing pat.

    The 3MM in debt service is more 10% of the unrestricted amount. For the “theater based propserity” you mention to happen, the project would be a parallel shift of more than 10% in today’s dollars. That is fantasy. It would require the increments to grow at a far faster rate than the taxes generated by the rest of the city.

    And the “today’s dollars” stipulation is important. Dollars spent now are worth more than dollars spent in the future. In order for the increment to pay an amount justified by the debt service expenditures, it has to surpass the P13 increase AND the general rate of inflation, and remember that inflation is cumulative.

    Ultimately, becuase of Brown’s shout down of redevelopment, whatever increments are generated might make it back to the GF, but two very important footnotes:

    a) That assumes a new scam isn’t cooked up to keep that money out of the GF, and there is much rumbling in Sacramento about that

    and

    b) Such a re-transfer was never envisioned in the original deal, at which time redevelopment districts were perpetual. It was a horrid deal for taxpayers as conceived, and the fact that an unexpected shift in regulations might mitigate it is nothing to crow about. Just makes it a less poor deal.

    You’re right Mark, you did say more than “we love movies.” You speculated there might be a long term payoff. A long term shot a a bit of ifcome, and that’s a huge IF, does not a viable plan make. Is that all that can be said in favor? Movies are fun, PSBA is feeding at the trough, public services are strained, but there might be a tiny payoff a generation down the road. That’s some plan…

    Comment by dave — December 2, 2013 @ 7:42 am


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