Redwood City’s Free-Market Parking Meters

At first glance the notion of free-market parking meters seems impossibly arcane. But as Donald Shoup pointed out in a recent NY Times editorial, “cruising for curb parking generates about 30 percent of the traffic in central business districts.” Shoup studied Westwood Village, next to the UCLA campus, and found that drivers searching for curb parking created 950,000 excess vehicle miles of travel per year. That’s equivalent to 38 trips around the earth, taking place in just one retail district in L.A.

Shoup calls the impacts of parking space cruising “astonishing,” and he’s right. The unnecessary traffic congestion hurts downtown businesses and activities. The extra miles traveled waste gasoline and generate pollution. If curb parking could somehow be freed up so that it was always easy to find a space, then that extra waste and pollution could be eliminated.

One solution is free-market parking. Set parking meter prices so that 85% of spaces are occupied and 15% are open at any given moment. This idea has been getting more attention lately, and Redwood City, CA is the locality that has put the most advanced implementation into action.

Dan Zack is the downtown development coordinator for Redwood City and developed and administers the city’s downtown parking program. He wrote in a March 27, 2007 listserv post:

We have only been fully operational for three weeks, however the early results are looking good.

We never had an overall parking shortage, but our prime areas were always chronically congested, with the frustration, cruising, and complaints of “this place has no parking” that parking congestion entails. However, within a few blocks there were always plenty of spaces. We had an odd system in which Broadway (the main drag) was free, while side streets and garages were metered. So people were actually given no incentive to walk a little bit — they were actually penalized for it!

We were willing to bet that people would be willing to walk if there was a reward. So we set up a system in which the main drag is 75¢ per hour, side streets are 50¢ per hour, and lots/garages are 50¢, 25¢, or free depending on their desirability. We were so confident in the ability of prices to effectively distribute people that we eliminated time limits. Time limits were difficult to enforce and resulted in a very inconvenient system for customers, while employees easily evaded them and sat in prime spaces all day.

Pricing curb parking by street is really the key to Redwood City’s strategy. Here is a map of the city’s parking prices as of March 10, 2007:


Zack describes the results of the parking strategy:

So far, Broadway has decongested quite a bit. You can now find a spot at most times in prime areas. Many people, especially long term parkers and bargain hunters, have shifted to cheaper parking on the edges of Downtown and off the street. Seventy-five cents isn’t a lot of money, but you would be amazed at how frugal people are when it comes to parking, even if they are driving $50,000 BMWs filled with $3/gallon gas. After the system has been in place for a few more months and behaviors have really adapted I plan on writing a paper that will summarize our findings.

As far as I know, we are the first city to do this. But I really think that it is a promising method for managing municipal parking and getting the most out of a limited amount of parking in a compact, walkable district.

Also, we borrowed a page from Pasadena’s playbook and have dedicated all surplus parking revenue (after parking expenses are paid) to increasing cleanliness, safety, lighting, street furniture, and other amenities that will make Downtown a nicer place to live, work, eat, see a band, and shop.

That last paragraph brings up an important point about political acceptance. Try proposing higher parking rates, and people will react as if their cars are being confiscated. For free-market curb parking to win acceptance, the benefits to the affected businesses must outweigh the costs.

In Pasadena, CA, parking meter revenue goes directly to the downtown business improvement district, bypassing the city’s general fund entirely. A similar arrangement in Redwood City made that city’s new parking strategy politically feasible. Here’s Dan Zack again, from an interview in SF Weekly:

At first the merchants went crazy about the cost increase. When we told them about how there will be no time limits, that we’ll be power-washing the sidewalks, they were in. When we had a City Council meeting, merchants came to support it.

New Tech

New parking meter technology is making Redwood City’s parking extremely flexible and convenient. From his desk, Zack can monitor vacancy rates and change the hourly price for downtown spaces. The system is easy to use: Customers simply enter their parking space number and pay. The city’s 40 parking meters have WiFi connectivity so that customers will get real-time credit card authorization, pay-by-cell-phone integration and the ability to add time at any pay station, from any location. Zack says,

[The meters are] all connected and share information with each other. If you want to spend more time on the east side of downtown and your car is on the west side, you can add time to your original parking permit from any pay station in the network without having to go back to your car. We think people are really going to love that level of convenience.

In summary, Redwood City’s program is shaping up to be a best practice in parking management. From all the reports to date, it’s an approach that nearly all downtowns could benefit from.

Obligatory environmentalist disclaimer

Some of Redwood City’s parking meters are solar powered, which is a bit ironic. The world will soon reach a peak in oil production, after which high gasoline prices will be unavoidable. If we don’t start switching to non-gasoline cars soon, there may not be as much demand for parking spaces. Additionally, cars must be powered by non-fossil energy, or else we may be spending more time dealing with climate change than driving to downtown cultural/entertainment districts. So let’s hope we have non-fossil cars in addition to solar parking meters.

And it goes without saying that the most environmental travel modes are walking, biking, and transit where land use supports high ridership. Redwood City aims to redevelop as a convenient, mixed use, beautiful and walkable center oriented to the fun and opportunity of urban life. That’s the best parking management strategy of all.



Donald Shoup’s home page, which includes a case study of Pasadena’s experience with curb parking reform: Turning Small Change into Big Changes

Gone Parkin’
, an editorial by Donald Shoup, New York Times, March 29, 2007

Redwood City’s parking information pages, the city’s parking prices map and its parking ordinance

Digital Payment Technologies, manufacturer of the parking meters used in Redwood City

Digital Payment Technologies’ press release about Redwood City (February 27, 2007), the technical information page for the parking meter, a product sheet and a closeup photo of the parking meter

The Parking Fix, Wall Street Journal, February 3-4, 2007 issue

Remote Controlled, by Matt Smith, SF Weekly, August 17, 2005

More about the redevelopment of downtown Redwood City: No More Deadwood, Metro Silicon Valley, January 10-16, 2006 issue

7 responses to “Redwood City’s Free-Market Parking Meters

  1. Jack Greenbaum

    Dan Zack may be under the delusion that local business is pleased with the new parking program however in actual fact Mr. Zack has ignored the merchants and small business employees in Redwood City. I have tried on numerous occasions to contact Dan Zack and work out a resonable plan for the working class to park in the city on a daily basis. It now cost $4.50 per day for a working class person x 5 is $22.50 per week $90.00 a month or over $1000 a year. That’s crazy for this area Dan Zack has shown little or no interest in helping us.
    It may end up driving out small business.

  2. Laurence Aurbach Post author

    The lowest-cost parking option for workers in downtown Redwood City is a monthly permit for $30/month or $330/year.

    The more general point is about fairness. Redwood City allocates a scarce resource (on-street parking in high-demand areas) by allowing rates to rise to the price customers are willing to pay. The city decided that’s a better policy than subsidizing below-market parking. Subsidized parking causes perverse outcomes: more pollution, more traffic congestion, less convenient parking, less income for streetscape improvements, and less business for local shops.

    Market rate parking makes transit, walking and carpooling more cost-effective. Market rate parking is regressive, but it’s a better deal overall when all the costs and benefits to the community are considered.

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  4. Dan Zack

    Jack! I thought we were friends! I’ve always tried to help you out when you’ve called. What you said about me wasn’t very nice. I’m shocked by this comment because you’ve never expressed this personal displeasure with me before.

    Nevertheless, let me assist you by helping you to understand parking on your block a little better and to update you on some great new developments.

    NO TIME LIMITS: When the new program went into effect your employees gained a great amount of flexibility that they might not have discovered yet. Your block has 104 parking spaces. Under the old system they only had 17 spaces to park in without having to move their car after two hours (or less) or face a $25 parking ticket. Now all 104 spaces are open to your employees and they can park there as long as they’d like without worrying about moving their car or getting a ticket, as long as they pay the meter. The meters have all been reprogrammed to accept as much money as you want to put in them (rather than only accepting 36 minutes or 2 hours worth as they did in the past).

    NO MORE NEED FOR CHANGE: In addition to parking tickets and car shuffling, your employees also used to have to worry about carrying around a bunch of change for the old meters. The new meters take credit cards, debit cards, and dollar bills.

    CHEAP PARKING STILL AVAILABLE: The meter rates on your block vary based on demand from 25 cents per hour to 75 cents an hour. Here is a breakdown:

    Broadway 12 spaces 75 cents per hour
    Perry Lot 52 spaces 50 cents per hour
    Perry Street (Broadway to parking lot)
    11 spaces 50 cents per hour
    Perry Street (parking lot to Brewster)
    9 spaces 25 cents per hour
    Brewster 2 spaces 25 cents per hour
    El Camino 18 spaces 25 cents per hour

    CHEAPER PARKING AVAILABLE WITH A MONTHLY PERMIT: Depending on how many hours per month your employees work, a monthly permit may be an even cheaper alternative. They range from $40 to $60 per month in the Perry Lot. They can be purchased at the Revenue Services counter at City Hall. More information is available at this link:

    ADDITIONAL PAY-BY-SPACE METER IN PERRY LOT: Since the Perry Lot is such a popular parking destination due to the proximity to interesting businesses like yours, we are adding another meter in 2 weeks to eliminate lines.

    FREE NIGHT AND WEEKEND PARKING: I am excited to announce that we have just negotiated an agreement for free night and weekend parking in Caltrain’s parking lot on Perry Street. This adds 160 spaces 1 block from some of the best restaurants and shops in Downtown Redwood City right when we need it. The parking will be free to the general public (including employees of retail shops) after 6pm during weekdays and all day during Saturday and Sunday. The agreement has been signed and it will take effect in mid-September. Look for the new signs, and thank Councilman Jim Hartnett for his tenacity on this issue. He made it happen.

    MERCHANT SUPPORT: Many merchants contributed great ideas to the creation of this plan during the public workshops, and many turned out to support its adoption when the City Council considered the matter. The Downtown Business Group still supports the program and is excited about the benefits it brings to Downtown. I just met with them 2 weeks ago and they reiterated this support.

    Hopefully this information will help you and your employees out. I like you and I like your business and I’ve always worked hard to help everyone as much as I can. Rather than calling me names on the internet, swing by City Hall or give me a call and I’ll make sure you have all of the info that you need. And you know you can always sick your good buddy Tom B. on me. He and I are family now!


  5. Mike

    Isn’t it also possible for Mr. Greenbaum, small business owners, and their employees to take transit as well? I sometimes think the entitlement mindset of free parking is what causes small businesses to fail in the first place. That is to say, I don’t see many small businesses, shops or independent restaurants in new developments, or car-dependent malls. These locations are all taken by national chains and large retailers. For a CBD to survive it should focus on a pedestrian scale that is inviting to people, and not on an automobile scale that is inviting to cars.

  6. Herbie Huff

    A slight detail, but it matters: the term “free-market” parking is a misnomer here. This is performance-priced parking, and because it employs prices it takes advantage of market incentives.

    But the term “free market” generally refers to a neoliberal ideology that comes with privatization, and that’s not what Redwood City is doing. The parking meters are publicly owned and publicly regulated.

    They just use prices, a staple of the private market.

  7. Laurence Aurbach Post author

    Herbie: This method of pricing parking can go by either name. While is it true that in recent decades “free market” has been associated with laissez-faire and privatization, the term has been used for centuries to signify any unencumbered market.

    From a public relations point of view, I prefer “free-market parking” or “market-rate parking” because it communicates the essential idea straightaway. It also has connotations of freedom: people’s choice in action. Whereas “performance parking” could mean anything, including the expansion of parking supply. It has to be explained. And it has connotations of tests and standards, which may not be desirable in some circumstances.

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