Regional Pricing Policies

Policy Question: What are the most effective actions the regional agencies can take to support pricing parking policies?

Question Purpose

What is the purpose of this question, why is it important, and who is the intended audience?

The purpose of this question is to obtain recommendations for the regional agencies to support the development of effective regional parking policies within the economic and political environment of the Bay Area. Parking policies are typically implemented by local jurisdictions, yet these locally made parking policies impact regional transportation patterns—including the use of transit, vehicle use, traffic congestion and greenhouse gas (GHG) emissions in the short run, and development patterns and land use/development prices in the long run.

Transportation issues are addressed at the local, county and regional level in the Bay Area. MTC/ABAG are required by state law to address specific housing and GHG goals in the regional transportation plan, and also have a number of other goals that are potentially impacted by parking policies, including housing affordability and transportation costs. Approximately 40% of GHG emissions come from the transportation sector in the SF Bay Area. Given State requirements to reduce GHG, the regional agencies are seeking approaches on all fronts to help achieve these goals.


Figure 1: SF Park has been one of many successful Bay Area park pricing programs. Image:

A number of Bay Area cities have successfully demonstrated the efficacy of parking pricing and management through reforms to local parking policies, including notable approaches in San Francisco, Berkeley, and Redwood City. Many areas in the Bay Area currently do not charge for parking, despite high demand and/or continual construction of costly parking facilities. It appears that widespread local adoption of parking pricing and related policy reforms may not occur without action at the regional level. Key impediments appear to be the hidden nature of parking subsidies for both the public and for planners; a general resistance to change to long accepted parking policies by professionals; a lack of local constituents in favor of priced and other reformed parking policies; the perception that cities need to compete for retail customers through the use of free parking; and a lack of familiarity and knowledge of the shifting demand market for housing with less parking.

More fundamentally, parking pricing only makes sense if it is rationing a scarce resource. Most suburban jurisdictions and many urban jurisdictions require parking quantities that developers would not voluntarily provide since the end users would not be willing to pay for that supply. Local ordinances in some Bay Area cities require an excess aggregate supply of parking, and when that occurs, both parking pricing and parking management are largely irrelevant. Even if those jurisdictions have reformed their parking requirement, the legacy effect of past requirements is that there is an aggregate oversupply of parking in most locations. This oversupply of parking, of course, pushes the market price to zero. Artificially imposing pricing in a parking oversupply environment may shift parking location, as people switch from priced locations to unpriced ones, but it does not affect parking demand since there are plenty of parking alternatives.

The most effective long-term strategy to encourage pricing is to reform and/or eliminate parking requirements and to adopt development policies that allow development on excess parking lots. The question for regional entities is the ways in which they can accelerate that reform process. Parking requirements are part of local zoning authority that resides with cities unless the State of California intervenes. Regional entities are in a weak position to require changes in local practices, despite many worthy efforts that are documented in the next section.

Having noted the limitations of regional entities, it is important to note that regional approaches to parking policies may offer benefits to the region, local jurisdictions within the region, and the public. At the macro level, a regional oversupply represents an underutilization of valuable land resources. Regional parking policies could potentially benefit the region by creating more economic efficiency through better use of land and reduced subsidies for parking. Regional parking pricing policies can also address potential consistency issues in parking policies across city boundaries. For example, issues sometimes arise due to cities competing because they fear that businesses will lose customers to neighboring cities if they start charging for parking.

Analysis of the most effective actions regional agencies will provide basis for development of regional policies by MTC/ABAG and potentially other regional or state agencies such as the Bay Area Quality Management District (BAAQMD) and Caltrans that are effective under conditions of limited staff time and political sensitivity.

Overview of Analysis

How is this question being addressed? What approach is best, given limitations?

Ideally, the project would provide an extensive analysis of successful parking pricing programs in other regions or other parts of the world, including results/impacts where possible, along with an analysis of the economic/political context and the extent to which certain policies might be feasible and effective in the Bay Area. The project would incorporate this information into the regional models and compare their impact side-by-side as well as qualitatively evaluate their political feasibility.

Due to limited resources, this question is addressed through review of examples of regional or similar level frameworks for parking pricing policies as well as in a discussion-based context, including expert panel discussions and feedback from local and regional representatives. The project focuses on a detailed review of key examples of regional approaches to pricing policies to provide the most value to the region.

Background & Research

Literature Review:

Addressing this question requires thorough analysis and review of actions that regional agencies can take to support parking pricing. This includes analyzing a range of reports conducted by transportation agencies in the Bay Area. These materials will inform specific policies that are recommended as the most effective regional actions for the Bay Area. The best practices below highlight some of the key research and reports that will be used in the full analysis of this question.

Currently the regional agencies use a combination of funding support for specific local projects (particularly those with air quality and greenhouse gas (GHG) benefits), planning processes, and cooperative work with local jurisdictions. This section includes descriptions of some key policies and programs, as well as potential to expand them or use similar tools to continue working towards similar goals—that regional agencies in the Bay Area have implemented with these strategies.

Bay Area Regional Parking Research

Figure 2: Everyone must pay. Image:

MTC conducted a study directly addressing the question of what regional strategies would be effective in supporting widespread parking reform in the Bay Area, as reported in Regional Parking Strategies for Climate Protection, January 2010. This report provides a solid foundation for addressing this question of which actions are most effective regional by assessing the interests, authorities and relationships between various stakeholders and policy makers. The study presents and applies criteria for evaluating potential policies, and recommends strategies for policy implementation, including an approach for monitoring and evaluating implementation and performance.

MTC has conducted a range of studies in the last couple of years relating to policies that involve parking or focus entirely on parking policies. Table 10 briefly lists a handful of regional actions related to parking by MTC.

Table 10: List of Regional Parking Analyses by MTC

Year Title Description
2012 MTC Smart Parking for Smart Growth workshop Workshop for local planners and policy makers to help educate jurisdictions about recent California legislature (AB904, Skinner) and research on “smart” parking policies for transit-rich areas.
2012 MTC Parking Structure Technical Report Research to better analyze needs and evaluation process of parking structures near transit.
2012 Parking Stakeholders Survey, MTC’s Smart Parking Technical Assistance Program Research conducted including surveys and interviews with stakeholders related to their experience with parking standards.
2012 Survey of Bay Area Cities’ Parking Requirements, MTC’s Smart Parking Technical Assistance Program Analysis and survey of the parking requirements within 52 cities throughout the Bay Area providing baseline information on existing requirement policies.
2012 New Partners for Smart Growth: Putting Parking in its Place for Smart Growth A 3-hour expert-panel event presenting an array of smart parking policies at the New Partners for Smart Growth Conference.
2012 Parking Code Guidance: Case Studies and Model Provisions, MTC’s Smart Parking Technical Assistance Program Provides key issues and offers parking code guidance to help local jurisdictions consider and enact parking policies.
2011 Parking 201: Economic Assessment of Structured Parking at Transit Stations An economic analysis of case study parking structures at transit stations and the ridership impacts of parking near BART stations.
2011 Parking fundamentals (101) Training: Fundamentals of Parking Reform Training session for local planners and staff to learn about parking best practices, common issues, and outreach.
2010 Regional Parking Strategies for Climate Protection Provides expert recommendations for immediate and longer term regional parking policies for the Bay Area, with information about potential timing, criteria for selecting particular policies, expected effectiveness, and approaches to addressing implementation issues.
2007 MTC’s Parking Demand Model An MS Access database that allows jurisdictions to input information about land use conditions to produce an estimated parking demand figure.
2007 MTC’s Toolbox/Handbook A toolbox of parking best practices and strategies for supporting TOD in the Bay Area.
Regional Policy Tools to Address Employee and Resident Dynamics

Commuting is a regional issue in the Bay Area, with a large portion of residents commuting outside their county of residence: Table 11 below shows that in many counties, less than half of the employees also live within their county of employment (with the exception of Santa Clara, Sonoma, and Napa). In total, 53% of the employed residents within the Bay Area work in their county of residence. This analysis is evidence that commuter transportation is a region-wide issue.

Table 11: Employer-Household Dynamics in the Bay Area

County Total Employed Residents Percent who Work within the County Total County Employees Percent who Live within the County
Santa Clara County 708,331 69.9% 804,359 61.6%
Alameda County 595,518 48.1% 604,522 47.4%
Contra Costa County 399,789 39.2% 309,427 50.6%
San Francisco County 356,170 60.9% 538,759 40.3%
San Mateo County 302,934 39.3% 303,529 39.2%
Sonoma County 175,173 61.0% 157,154 68.0%
Solano County 154,882 35.5% 111,942 49.2%
Marin County 91,693 39.6% 93,214 38.9%
Napa County 56,052 52.8% 57,692 51.3%
Total 2,840,542 52.9% 2,980,598 50.4%

Source: 2011, Longitudinal Employer-Household Dynamics

Developed by the Bay Area Air Quality Management District and MTC, the Bay Area has implemented a region-wide Commuter Benefits Program[1] (as described below), expansion of this program could include parking cash-out and employee transit passes, where success at the local level combined with larger-scale policy efforts suggest that these policies would be good opportunities for region-wide efforts to encourage alternative means of transportation to work. In addition to the state of Washington’s Commute Reduction Law and Boulder’s Employee Transit Program, a few examples below discuss regional-applicable examples in and nearby the Bay Area.

MTC’s Climate Initiatives Program

Very recently (summer 2015) MTC developed a small new pilot funding program focused on implementation of Transportation Demand Management in the Climate Initiative Program which is focused on the parking management strategies. This program will assist with equipment costs for smart meters, detection systems, wayfinding and enforcement programs. This is a new program, and future steps will depend on the effectiveness of this pilot project.

The Climate Initiatives Program is a joint effort by the regional agencies: the Association of Bay Area Governments, the Bay Area Air Quality Management District, the Bay Conservation and Development Commission, and the Metropolitan Transportation Commission (One Bay Area, 2014). These agencies have funded a number of major demonstration projects to test the most innovative strategies to promote changes in driving and travel behaviors, providing an opportunity to learn what kinds of strategies can most effectively reduce GHG emissions. A number of projects have a parking policy component, including goBerkeley and the Integrated Public-Private Transportation Demand Management Project. The regional agencies can learn from these innovations as well as promoting other innovations in future projects, and local jurisdictions can benefit from these experiments and analyses in innovation.

PDA Planning and Plan Bay Area

The regional transportation plan (Plan Bay Area) assists jurisdictions seeking to implement Plan Bay Area at the local level by providing funding for Priority Development Area (PDA) planning and transportation projects, technical assistance, and funding to support local professional staffing for such efforts. There is currently guidance regarding analysis of parking for PDA plans, yet this guidance could potentially be strengthened.

Plan Bay Area also provides jurisdictions with the option of increasing the efficiency of the development process for projects consistent with the plan and other criteria included in SB 375. Policies could also be developed, related to this policy or as a stand-alone, to directly encourage or mandate the reduction in local parking requirements for development in transit priority places (TPPs), as was considered in AB 904 (Skinner) in 2011-12 session (which was withdrawn).

The Regional Prosperity Plan

The Bay Area Regional Prosperity Plan includes a $5 million grant from the U.S. Department of Housing and Urban Development, ABAG, and MTC. The Prosperity Plan program spans three years and aims to promote sustainable communities and foster a clean energy environment. Through grants such as this one, regional agencies can create or support a parking certification program to bestow recognition on communities, employers and developers who implement innovative parking reforms, such as TransForm’s GreenTRIP program. TransForm’s GreenTRIP program includes a tool for estimating actual levels of parking demand and trip generation in transit-oriented areas. This tool will help address barriers to development, helping to reduce the cost of housing by eliminating underutilized parking spaces. Regional areas can help create or support parking programs by allowing parking reforms based on this tool.

CEQA and Parking

One successful policy action that was recently signed into law (effective January 1, 2014) is SB 743. SB 743 makes several changes to CEQA so that most projects located in PDAs in the Bay Area would no longer be required to consider aesthetics and adequacy of parking under CEQA. SB 743 provides that “aesthetics and parking impacts of a residential, mixed use residential, or employment center project on an infill site within a transit priority area shall not be considered significant impacts on the environment.” To avoid this consideration, a project must meet the following three criteria: (1) it is in a transit priority area; (2) it is on an infill site; and (3) it is a residential, mixed-use residential, or an employment center.[2] This success was made possible by several efforts by San Francisco and the Bay Area to recognize that parking supply in transit-oriented and high density areas should not be evaluated by the same methods and/or criteria as lower-density, automobile-oriented areas.

TransitLink for TOD (T4T) Pilot Program

MTC conducted a pilot project, in concert with AC Transit, to evaluate the long term impacts of a short term free transit pass program for residents of transit oriented developments.[3] The pass program resulted in both immediate and long term reductions in automobile trips and immediate and long term increases in the use of transit, significantly reducing greenhouse gas emissions. Pilot programs have the potential to expand throughout the Bay Area transit system with partnership between transit agencies and regional planning agencies. Transit subsidies and incentives for residents and employees of transit oriented developments could be implemented in several ways to reduce parking demand.

Commuter Benefits Program

Partially in response to the low level of participation in the State Parking Cash-out Program described above, and inspired by local commuter benefit ordinances (for examples, see the programs in San Francisco, Richmond, Berkeley, and San Francisco International Airport), MTC and the Bay Area Bay Area Air Quality Management District sought and received State authorization to implement the Bay Area Commuter Benefits Program. The program is being piloted from January 1, 2013 through December 31, 2016 with the goal of reducing drive-alone commute trips to Bay Area worksites and therefore decreasing traffic congestion and greenhouse gas (GHG) emissions, while saving employees (and potentially employers) money. The Program requires employers with at least 50 full-time employees to offer 1 of 4 commuter benefits options: (1) up to $130 per month tax-free transit or vanpool costs, (2) up to $75 per month employer-provided transit or vanpool subsidy (3) Employer-provided free or low cost bus, shuttle or vanpool service (4) or an alternative commuter benefit of the employer’s choice that is as effective in reducing drive-alone mode share.[4]

This program was recently implemented, so the impact and results are not yet known. However, similar programs in place by individual employers have been studied. The 2010 Commuter Benefit Impact Survey found that employees were twice as likely to use an alternative mode of transportation if their workplace offered tax-free transit.[5] A report by the Transit Cooperative Research Program (2005) found significant impacts from commuter benefits programs, including a typical transit mode share increase of 10% or more.

Parking Requirement Reform

Oversupplied parking is unpriced and general unmanaged. For example, the circumstance of a typical suburban mall is that parking is sized for a few of the busiest shopping days of the year, vastly oversupplying parking for the rest of the year. As described in Table 4, MTC has initiated a number of programs to accelerate this process, by providing information, analytical tools, workshops, and research. These efforts are working on the critical issue – parking supply – and they should be redoubled to set the basis for encouraging parking pricing. Regional efforts to encourage parking requirement reform could include funding local parking requirement consulting studies, educational material regarding the effects of minimum parking requirements, and developing regional standards for parking requirements (by area type), and tying funding allocations to compliance with regional standard. Regional entities can highlight best practice cities to show jurisdictions how reform works and the positive economic development, urban design, social justice, and VMT reduction benefits.

The greatest inefficiencies in parking use are the result of separated land uses. Mixed land uses naturally lend themselves to shared parking and great use efficiency. Therefore, regional support for local reform should not be limited to the parking requirements themselves – it should also support the adoption of mixed land use models that support shared parking. In addition, design regulations should require pedestrian access between sites to facilitate shared parking. Regional entities can provide best practice models, fund planning efforts and zoning rewrites, and tie other forms of funding to the reform of local planning.

State interventions such as that proposed by AB 904 can give local planners the cover to advance parking reform in their communities. Consistent with member cities’ perspectives, MTC could work with state legislators to support reform requirements that recognize local concerns.

Expand MTC’s Resolution 3434 TOD Policy

MTC’s Resolution 3434 TOD policy, adopted in 2005, allocates regional funds to select local agencies that plan for at least minimum threshold levels of residential development around future transit expansions. This requirement is a condition for readiness to move forward and provides funding for planning toward this purpose. This policy supports transit ridership by increasing development around stations, specifically in the ½-mile station area, aiming to improve transit investments and ease the Bay Area housing shortage by creating vibrant communities around transit.

This policy should be considered for expansion to include analysis of multi-modal access, as well as pricing and management policy options prior to the funding of parking structures. A regional focus on transit ridership and increased residential and mixed use development around stations could be supported with several parking policies, including eliminated parking requirements and Parking Districts that give employee transit passes in lieu of parking spaces. With increased requirements for the intensity of development, regional agencies can give bonuses or establish requirements for funding mandating that TOD areas reduce the amount of subsidized parking in the area to encourage transit ridership.

Expert Analysis

A panel of parking experts—including Donald Shoup, Elizabeth Deakin, Todd Litman, and Meea Kang—were interviewed and asked to give their experiences relating to this policy question. Each expert was asked ‘Do you have a favorite regional parking policy that MTC/regional agencies should consider pursuing?’ A summary of responses is given below.

Regional Policy Input – Expert Donald Shoup
Donald Shoup


Parking cash-out programs. One note about parking Cash-Out programs is that every City can pass their own penalty for violating the program, but the Air Quality Management District can set the penalty at the regional level. The law has already been passed; all that needs to be done is to set the penalty for violating the law. When it comes to parking, “I am pro-choice”.

Regional Policy Input – Expert Elizabeth Deakin


I think it would be helpful if MTC would work on parking technologies that make it easier to have very low pricing, flexibility in pricing, and easier and less-expensive enforcement of parking, etc. because cities are trying to solve these problems. A regional approach to study technology options, improved technology, create best management practices (BMPs) for parking technologies, etc., because it is more cost efficient, effective and avoids duplication, to do this on a regional basis than city by city. There are examples of cities purchasing equipment that did not have the appropriate software security (i.e. enable flexible pricing strategies, enforcement, etc.) or equipment costing lots of money to repair, etc.

Regional Policy Input – Expert Todd Litman


I agree with what all the previous panelists already stated, and MTC could help with implementation by providing the tools and information needed at the point that a decision is made. For example, the City of Seattle/Puget Sound Regional Council developed the Right Size Parking Calculator – a terrific device that allows the developer to identify the right amount of parking for their project. Communicating to the public about these approaches, strategies and the benefits others are experiencing would be helpful. MTC can help produce information via factsheets, brochures, websites, and calculators that are understandable to the public that focus on the direct benefits to various stakeholders of implementing these strategies. I think we are failing in terms of implementation and communication.


We have combined lessons learned from regional efforts, case studies from throughout the country and world, parking best practices research, travel models, and policy analyses with input from experts and transportation professionals to create a series of potential strategies and recommendations to reduce parking demand, encourage pricing policies, reduce housing costs and reduce GHG. Ideas range from simple extensions of current activities to new innovative strategies. The development of recommendations for regional actions to address the urgent nature of climate change in the multi-jurisdictional and highly charged world of regional transportation politics is complex. These ideas reflect the input of many dedicated professionals, and this approach is expected to result in new innovative policies to address these important concerns. Through this process we are hoping to develop effective, regional strategic actions to assist in the curbing of excessive GHGs in the shortest time frame possible.

Summary of Recommendations

The experiences from regional efforts to date as well as the parking best practices research available in this report were combined to create a series of recommendations that regional agencies may take to reduce parking demand and encourage pricing policies. The following recommendations also include references to best practice descriptions within this report for more details pertaining to the related best practice example.

  • Increase support for operational projects, such as the recently started regional commuter benefits program, and refine these projects to incorporate more policies directly related to parking (see Regional Policy Application: Commuter Benefits Program above).
  • Require a robust analysis of proposed parking structures that includes parking demand and multi-modal access to the service area as well as financial proforma of the proposed facility prior to MTC contribution of regional funds.
  • Establish a parking certification program to recognize communities, employers and developers who implement parking reforms.
  • Intensify housing development in the immediate vicinity of transit stations to maximize ridership, as a trade-off for building parking through expansion of MTC’s Resolution 3434 TOD Policy (see Regional Policy Application: MTC’s Resolution 3434 TOD Policy above) or an alternative method of financially and politically supporting station area projects that meet minimum criteria.
  • Work with private and public sector—such as transit agencies, developers, employers, and schools—to benefit from partnerships to expand pilot programs that will reduce parking demand.
  • Include a requirement for regional analysis of parking structures when regional funds are used, especially in areas nearby transit stations (see MTC’s parking structure analysis in Policy Question 5).
  • A new regional parking fee or tax program, potentially with proceeds being returned to local jurisdictions for use on TDM projects. Parking taxes can be levied in a variety of ways to turn some of the indirect costs of parking back on the owner and/or user of parking, and can be used to support alternative access modes and other local livability improvements. Indirect costs of parking include foregone tax revenue, direct environmental effects such as runoff and urban heat island effects, and greenhouse gasses and other pollutants.[6]
  • Engage local jurisdictions in a process to understand the meaning of the SB 743 CEQA changes, how these affect their community and planning process, and guidance for TOD and infill projects (see Regional Policy Application: CEQA and Parking above).
  • Support a pilot program to establish a Parking Benefit District, using meter revenue to fund programs that will decrease parking demand and benefit the community, such as transit passes for employees and/or residents who work/live in the area, therefore making more parking available for customers and visitors (see Policy Question #9: Parking Benefits District).
  • Provide local jurisdictions resources and incentives to enforce the State of California’s parking cash-out law (see Policy Application: Santa Monica’s Parking Cash-Out Policies above).
  • Expand the Commuter Benefit Program to include additional subsidies that support households and individuals who opt out of automobile ownership, for example by continuing recent expansions in Clipper Card integration to create a subsidy program for eligible TOD residents and/or employees who opt out of vehicle ownership.
  • Collect code and policy language of examples of strategies that address each of the major parking concerns that were identified by Cities in the 2011 MTC Parking Survey (see Policy Question 8) and make these examples publicly available for cities to use (Note: establishing the framework for doing this—an online database for parking information—is included within the goals of the VPP Parking Project).
  • Establish the framework, language, and incentive structure (potentially aided by experience through pilot programs or local best practices) for cities to implement policies that reduce parking demand (see description of Washington’s Commute Reduction Law in Policy Question 6).


What (if any) impediments inhibit our ability to answer the question entirely?

Only a handful of agencies have implemented parking pricing and management policies to date at a regional scale, so this project must innovate with few successful examples to learn from. Further, the political relationships within each region differ, requiring careful attention to the dynamics of the San Francisco Bay Area. While there are quantitative measurements we can gather from modeling policies, many elements of a policy that make it effective are qualitative in nature—such as feasibility and political acceptance. Many of the successful best practice policies/programs in other regions are not necessarily transferable, due to the differing political atmosphere.

Potential Policy Actions

  • Fund continued and expanded data collection and develop, support, and refine the VPP parking database and data analysis tools. Further refinement of these tools will help data to analysis lead to strategies for implementation.
  • Continue funding and guidance for PDA planning, technical and staff assistance for parking elements.
  • Fund local/corridor parking implementation strategies and actual implementation (such as smart meters, wayfinding and clear regulatory signage, online permitting sales, personnel, pilot programs and enforcement technology)
    • Establish a regional parking space fee for congestion reduction and greenhouse gas (GHG) reduction purposes, in coordination with the Air District, potentially including a return to source for neighborhoods, cities, CMAs, and or transit agencies to support livability measures and alternative modes.
    • Develop a regional parking management system plan for local jurisdictions including steps of problem definition, analysis, development of strategies, pilots, equipment, and communications; the implementation of successful approaches should be on a broader scale, including new technologies, and maintenance and management.
    • Regionally monitor, summarize and analyze local strategies, evaluate and make recommendations, and provide financial support regarding successful strategies.

Additional Information

King County Metro, serving the Seattle-King County Area, conducted an innovative, data-driven research and outreach effort focused on helping local jurisdictions and developers to balance parking supply and demand for multi-family buildings. [7] Completed in 2015, the project determined that existing multi-family parking capacity exceed utilization by an average of 40 percent. [7] It is lessons learned from studies like these that can help a city pivot from policies that overburden developers with arcane parking requirements and the high-costs that trickle down to the consumers.




[4] Bay Area Commuter Benefits Program.

[5] Bay Area Commuter Benefits Program Staff Report (January 2014)

[6] Litman, T. Parking Taxes: Evaluating Options and Impacts. Victoria Transportation Policy Institute, 2013.


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