SB 728: Expanding California’s Parking Cash-Out Program, or “How much for that space, buddy?”
Posted April 17, 2009 in Moving Beyond Oil, Solving Global Warming
California has historically been an environmental leader. Three years ago, we passed AB 32, the Global Warming Solutions Act, the nation’s first statewide program to reduce global warming pollution, and last year we passed SB 375, which for the first time will tie land use and transportation investment decisions to reducing global warming pollution.
And 16 years ago, the California Air Resources Board (CARB) required that employers with over 50 employees adopt a Parking Cash Out program.
OK, so maybe Parking Cash-Out isn’t exactly at the level of an AB 32 or SB 375, but it is a great example of how creative we can be in tackling global warming.
What’s Parking Cash-Out? It’s simple: an employer who offers free or subsidized parking for employees must also offer a cash allowance equivalent to the subsidy in lieu of the parking space. So, if your free parking space at Justin Horner Pet Supplies & Satellite Repair Company costs me $200 per month, I can offer you either the space or a $200 monthly payment.
Now, as I will discuss at length in the near future, free parking is never free. There’s the cost to construct it, operate it, maintain it, even light it and secure it. But more than 95% of all parking in California is free for drivers. The costs of this “free” parking are passed through to all of us in higher prices, higher rents, higher taxes and lower wages. Any effort to better match the real cost of parking to the decision to park will be both environmentally beneficial and more fair.
For example: where employers provide it, Parking Cash-Out reduces single-occupancy vehicle trips and increases carpooling and transit use. A survey of eight Southern California businesses using the Program found a 12% decline in annual vehicle miles travelled and global warming pollution per employee per year, and a nearly 10% increase in employees carpooling or using transit. All this, while putting more money in workers’ pockets and saving money for participating employers.
It’s also more fair: if you choose not to take my cash-out offer, you’re effectively paying $200 for your space, which removes the unfair subsidy you would normally get, but that your carpooling, transit-riding, walking and biking co-workers do not.
So how can you get Parking Cash-Out as an option where you work? A start is with SB 728 from Long Beach’s State Senator, Alan Lowenthal. SB 728 would allow localities—cities, counties and air districts—to require Parking Cash-Out, if they so choose.
See, Parking Cash-Out was intended to be administered by the Air Resources Board, but ARB lacks the staff to really commit to widespread enforcement (they have an awful lot on their plate already, believe me). On the other hand, some localities, like Santa Monica, have already begun requiring Parking Cash-Out, and many others are interested in doing so. SB 728 will explicitly give those localities the tools they need.
NRDC is co-sponsoring the bill with our friends at Environmental Defense Fund. Parking Cash-Out is an easy, straightforward way to provide Californians with a meaningful alternative to driving alone to work. If you think so, too, drop the Senator a line saying so; I’m sure he’d appreciate it.
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Comments
Red Desert — Apr 17 2009 03:06 PM
Unless an employee uses her/his vehicle at work, it's my understanding that the parking benefit is technically taxable to the employee. However, I think this most often not the case and parking is expensed by the employer. But the cash payment would almost certainly be taxable.
V Smoothe — Apr 17 2009 06:06 PM
I think this is a wonderful idea. At my last office job, employees had a choice of free parking in the building or commuter checks. I asked for the commuter checks, but was told that since I walked to work instead of taking the bus or BART, I didn't "need" them, and therefore they wouldn't give them to me. My argument about how that was part of our compensation, and shouldn't be based on "need" fell on deaf ears.
Jeff Lassle — Apr 18 2009 02:21 PM
How absurd. This is why California is called the land of nuts and fruitcakes. With 12 businesses leaving daily as they cannot comply with radical environmental laws that have no environmental or medical benefits, it is no wonder California has one of the highest unemploymet rates in the country. Let me reitterate, no environmental or medical benefits whatsoever.
As California rates 49th out of 50 states as the worst school systems in the country, it is no wonder the base of the liberal party cannot understand simple science and thus are easily led like lemmings by the radicals of this state.
LT Schultz — Apr 21 2009 07:31 PM
When I first read Jeff's comment, I figured he must own a parking lot. But then I read the NRDC link to SB 728. It does seem like another mandate. Wouldn't it be easier to give a modest tax break to companies that offer "parking choice" to their employees? I think California would get much better participation. You might be able to get the Chamber of Commerece to support the idea. (Give business a choice, too!)
Keep in mind that "choice" is probablyh not a 1:1 trade for companies. (Let us know if know otherwise) Salaries come with increased payroll tax, workman's comp, perhaps increased benefit costs too. These costs aren't a lot, but the idea is to encourage folks to get out of there cars.
Where I work, we realized a long time ago that paying for parking encourages driving over car pooling or the use of public transportation. We decided, for those that wanted, to pay for monthly transit passes or to give a small boost in salary instead of parking. One employee sold her hybrid and bought a house. She says the extra pay was just enough to help her qualify for the loan.
Justin Horner — Apr 23 2009 02:16 PM
Thank you all for the comments. SB 728 is not, in itself, a mandate: it simply gives localities the option of enforcing a law that has been on the books, but underenforced, for more than 15 years. If a locality is concerned about driving a business away, I suppose it can just choose to not enforce the requirement.
On the tax issue, a policy that can compliment Parking Cash-Out is the provision of employee transit passes. The proverbial "win-win," they're tax free to employees and tax deductible for employers.