Parking In-Lieu Fees
Quinn Le Frois (author), Charlie Cowell, Tegan Jarchow, & Jonathan Rosenbloom (editors)INTRODUCTION
Parking in-lieu fees, also known as “Park and Walk Systems,” are generally used in larger cities and suburbs. They are often utilized if a defined area has sudden development growth or there are multiple establishments renovating their property.[1] These fees are in-lieu of having or meeting individual off-street parking requirements.[2] Pursuant to ordinances with parking in-lieu fees, new developments are required to pay a fee into a designated fund.
The monies from parking in-lieu fees are used to pay solely for one or more larger parking developments[3] that serve an entire district.[4] The parking areas should be centrally located, so that pedestrians and shoppers have easy access to businesses.[5] Since the larger parking developments serve an entire district, the parking area must be strategically placed for full accessibility to all the participants within the district.[6] Depending on the jurisdiction, the parking developments are often “managed by the city, parking authority, or master developer.”[7]
The in-lieu fees may be mandatory or voluntary depending on the jurisdiction.[8] Local governments can either require developers to pay the fee, or a developer can choose to pay the fee or provide individual parking.[9]
Fees are typically set using two approaches.[10] The first approach is to calculate a flat rate for each parking space not provided.[11] This flat rate is also known as a “uniform fee.”[12] A uniform fee is a tangible way for developers to incorporate the proposed fee into their financial analysis.[13] The fee calculation can vary by jurisdiction, but can involve variables such as building gross square footage, gross parking demand, net parking demand, and parking provided on site.[14] The second approach is to determine appropriate development-specific fees on a case-by-case basis.[15] This approach is seen as more time-consuming and expensive because of the specific nature of each case.[16]
EFFECTS
Enacting a parking in-lieu fee ordinance can provide several benefits, including decreasing the amount of individual parking lots, which can have significant impacts on stormwater systems, energy demands, and other challenges.[17] Parking in-lieu fees provide a set option for developers. Instead of paying to construct individual parking spaces, which can be expensive, developers are given the option to pay the fee for a district parking area.[18]
In addition, because the central parking area is for the entire district, the shared parking spaces may be occupied more often when not solely devoted to one particular development or business.[19] Therefore, fewer spaces are necessary to meet the overall demand, since the turnover rate is higher when different businesses require parking at different times of the day.[20]
“[L]ess on-site parking allows continuous storefronts without gaps for adjacent surface parking lots.”[21] Multiple parking lots interrupt the aesthetics of the continuous line of storefronts.[22] Parking in-lieu fees may also reduce variance requests.[23] Developers often request variances from parking minimums.[24] Because the fee includes a built-in alternative there is no need for a variance.[25] In-lieu fees also allow “adaptive reuse of historic buildings where the new use requires additional parking that is difficult to provide.”[26]
Parking in-lieu fees contribute to positive pedestrian mobility systems by incentivizing people to walk. Because there are no direct off-street parking attached to each development in a parking fee district, shoppers and other pedestrians must walk from the designated parking area to their destination.[27] The presence of open shops and people on the street also encourages other people to walk.[28] Walking by shops and restaurants to get to their destination gives pedestrians a more comfortable and encouraging environment.[29] Empty streets with few pedestrians are usually avoided by other pedestrians.[30] Indeed, “[t]he more downtown is broken up and interspersed with parking lots and garages . . . ‘the duller and dead it becomes’”[31]
Safety from a central parking location also benefits pedestrian mobility. With the in-lieu parking fees, there are fewer separate parking lots. Fewer parking lots can decrease the amount of traffic concentrated in a particular sector because parking is not available. Fewer parking lots also means pedestrians do not have to walk by or through parking lots and access driveways that have cars entering and exiting at different intervals (for a brief discussing the benefits of limiting access points for pedestrian safety, see Limit Driveway Access Points).[32]
EXAMPLES
Scottsdale, AZ
Scottsdale is located in Maricopa County, AZ.[33] In 2019, the population was estimated at about 246,645.[34] The City’s in-lieu parking program is implemented in the downtown district.[35] The program focuses on smaller properties and provides owners opportunities to “reinvest, develop, and redevelop to the highest and best use of the property.”[36] Scottsdale views the in-lieu fee policy as an investment for the future, when businesses and populations will increase. Another purpose is to provide an encouraging environment for pedestrians.[37] Fewer parking lots means fewer unsafe or inconvenient encounters that pedestrians will have with vehicles. Scottsdale also wants the ability to properly use the space in their downtown district and to fully appreciate the “urban design” of the downtown area by having fewer parking lots.[38]
Part of this in-lieu parking policy is the allocation of fees. First, a property owner or developer pays a fee to the City’s downtown parking program.[39] The fees themselves are established by the City Council and subject to change.[40] Then, the fees are distributed to the downtown parking program as well as to the downtown tram service.[41] Part of the downtown parking program uses the fees for maintenance and provision of the centralized parking spots.[42]
The City Council determines whether a property owner or developer is eligible to participate in the program.[43] The City’s in-lieu parking plan also includes an in-lieu parking credit system.[44] Credit is awarded by the Zoning Administrator and can be used for permanent, monthly, or evening use.[45] The number of parking credits equates to the number of parking spots available to the property owner, with the maximum being five in-lieu parking credits.[46] The property owner can “purchase and/or lease the requested number of in-lieu parking space[s].”[47] The parking credits are used by the City Council to ensure the proper allocation of parking spots for each property owner.[48]
To view the provisions, see Scottsdale, AZ, Code of Ordinances, App. B, § 9.108(D) (2018).
Dania Beach, FL
Dania Beach is located in Broward County, FL.[49] In 2017, the estimated population was 32,030.[50] The Community Development Director determines the adequacy of the current on-site parking situations at new or existing developments.[51] If there is inadequate on-site parking, the owner of the property applies for a waiver allowing off-street parking spaces.[52] If the waiver is granted, the property owner pays a fee-in-lieu of the on-site parking.[53] The fees are calculated by the “average cost to the city for the construction of a parking space in a parking structure.”[54] Collectively, these decisions are made by the Director of Finance, the Public Services Director and the Community Development Director.[55] The City also has Parking Priority Districts; these districts receive priority use of the parking in-lieu funds.[56]
To view the provisions, see Dania Beach, FL, Code of Ordinance § 265-92 (2012).
ADDITIONAL EXAMPLES
Morro Bay, CA, Code of Ordinances § 17.44.020(A)(7) (2017) (stating requirements for parking in-lieu fees and how these fees are calculated).
Dundee, FL, Code of Ordinances § 3.03.02(I)(7) (2017) (describing requirements for parking in-lieu and the limitations of the program).
Miramar, FL, Land Development Code § 715.3.1.2 (2017) (explaining in-lieu of parking fund fee calculation and the terms of the agreement for the program).
CITATIONS
[1] Robin Zimbler, Driving Urban Environments: Smart Growth Parking Best Practices 4, https://perma.cc/3T7E-AXAJ (last visited May 28, 2019).
[2] Jeff Speck, Walkable City Rules-101 Steps To Making Better Places 40 (2018).
[3] Naperville, IL, Code of Ordinances § 11-2E-3 (2018), https://perma.cc/787Z-HA5W.
[4] Speck, supra note 2, at 40.
[5] Id.
[6] Id.
[7] Id.
[8] Kimley-Horn and Assoc.’s, Inc., Downtown Parking Strategic Plan: Appendix 2-Parking Planning White Paper Series, Parking in Lieu Fees, Capital City Development Corp 9 (Dec. 2012), https://perma.cc/T6P6-QEK6.
[9] Donald C. Shoup, In Lieu of Required Parking 309 (2001), https://escholarship.org/uc/item/8rp7s63c.
[10] Zimbler, supra note 1, at 4.
[11] Id.
[12] Shoup, supra note 9, at 309.
[13] Columbus Short North Parking Study, Best Practices-Parking in Lieu Fee 14, https://perma.cc/4JEU-GZEQ (last visited May 28, 2019).
[14] See e.g., Naperville, IL, Code of Ordinances § 11-2E-3.
[15] Zimbler, supra note 1, at 4.
[16] Columbus Short North Parking Study, supra note 13, at 14.
[17] Id.
[18] Shoup, supra note 9, at 308.
[19] Id.
[20] Id.
[21] Id.
[22] See id.
[23] Id.
[24] Id.
[25] Id.
[26] Id.
[27] Michael Manville & Donald Shoup, People, Parking, and Cities 6 (Fall 2004), https://perma.cc/FRW5-WX7P.
[28] Id.
[29] Id.
[30] Id.
[31] Id.
[32] See Zimbler, supra note 1, at 25.
[33] World Pop. Rev., Scottsdale, Arizona Population 2019 (last updated May 27, 2019), https://perma.cc/7SNT-ET9D.
[34] Id.
[35]See Scottsdale, AZ, Code of Ordinances, App. B, § 9.108(D) (2018).
[36] Id.
[37] Id.
[38] Id.
[39] Id.
[40] Id.
[41] Id.
[42] Id.
[43] Id.
[44] Id.
[45] Id.
[46] Id.
[47] City of Scottsdale, In-Lieu Parking: Development Application Checklist 2 (Mar. 2, 2015), https://perma.cc/PY3J-CCPT.
[48] Id.
[49] Dania Beach, Florida Population 2018, 2019, https://perma.cc/5D4P-CGP6 (last visited Jun. 11, 2019).
[50] Id.
[51] Dania Beach, FL, Code of Ordinance § 265-92 (2012).
[52] Id.
[53] Id.
[54] Id.
[55] Id.
[56] Id.