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A classic example is that of the Tennessee Valley Authority (TVA) in Knoxville, where extensive involvement by the TVA in the 1970s led to large increases in ridesharing among employees. The TVA program was oriented almost exclusively toward its approximately 3,000 central headquar- ters employees in downtown Knoxville. The program grew from one express bus in late 1973 to 10 buses carrying 330 people and six vanpools carrying 69 people 1 year later. Support actions included worksite advertising, a (pre-internet) telephone information service, carpool matching, and vehicle leasing assistance. Not insignificantly, a national fuel crisis occurred that year, with gasoline price increases that obviously raised interest in alternatives to driving. The program con- tinued, however, long after the initial shock. Bus and vanpool subsidies were added, as were pref- erential, inexpensive carpool parking spaces. By the end of 1976, 23 express buses, 18 vanpools, and 436 carpools were carrying 950, 2,400, and 1,400 employees, respectively, while site employment had grown by 400. The dramatic mode shifts and parking demand reductions that occurred are shown in Table 19-8 below for pre-program, program without monetary incentives, and program with monetary incentives (Wegmann, Chatterjee, and Stokey, 1979): Table 19-8 Impacts on Mode Share of the TVA Transportation Brokerage Program After Program (Context and Implementation Stages) First Stage Stage 1: Second Stage Stage 2: Mode and Other Before Gasoline Before Mone- Gasoline After Mone- Information Program Crisis Effect tary Incentive Crisis Effect tary Incentive Drive Alone 65% Yes 42% No 18% Carpool 30 Yes 40 No 41 Vanpool 0 Yes 2 No 7 Express Bus 0 Yes 11 No 28 Regular Bus 3 Yes 3 No 3 Other 2 Yes 2 No 3 Employment 2,950 -- 3,000 -- 3,400 Parking Demand 2,200 -- 1,940 -- 1,070 Source: Wegmann, Chatterjee, and Stokey (1979) with elaboration. The success of the TVA project spawned a citywide "brokerage" program in January 1976. By June 1977, 47 vanpools were carrying 450 commuters to 12 employers. Over 18,000 people had requested and received carpool match lists. A random sample indicated that 13 percent of the lists were used to make initial contacts with the intent of ridesharing. However, only 3.3 percent of those using the lists (approximately 80 persons) actually entered into ridesharing agreements. Degree of response was said to relate to the level of employer interest at each firm contacted (U.S. Department of Energy, 1979). Response to Incentives and Disincentives The theoretical basis for the role of incentives and disincentives in encouraging use of alternative modes is examined in the "Individual Behavioral and Awareness Considerations" subsection of the "Underlying Traveler Response Factors" section. In summary, to make alternative modes 19-40

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more attractive, it is frequently necessary to provide incentives to reduce the competitive advan- tage driving often provides in terms of door-to-door time savings and convenience. These incen- tives may act to reduce either the travel time or the travel cost associated with using the alternative, such that the comparative disadvantage vis--vis auto use is reduced or reversed. Both travel time and cost incentives are relevant in the choice of commute mode. Ways to improve the comparative travel time of alternative modes include: Reducing over-the-road travel time by providing HOV lanes on highways or streets, or pro- viding exclusive access via HOV ramps or turning provisions. Reducing wait or walk time in the case of transit, by shortening headways between transit vehicles, reducing the number or duration of transfers, or enhancing route coverage. Providing exclusive, close-in parking at the work site for carpool or vanpool users, thus offer- ing a walk time advantage over those driving alone. With exception of the third strategy, preferential parking, which was discussed earlier as a support strategy, these travel time strategies are not the subject of this chapter. Over-the-road travel time savings and reductions in transit wait or access time are public-side strategies (neither employer- provided nor TDM per se), and are discussed in detail in Chapters 2 and 3, "HOV Facilities" and "Park-and-Ride/Pool"; Chapters 4 through 8, which as a group cover "Transit Facilities and Services"; and Chapters 9 through 11, which address "Public Transit Operations." The economic incentives covered in this chapter and this section are financial incentives. In other words, they involve actions that either transfer money to decrease the cost of using alternative modes, increase the cost of driving alone (disincentives), or otherwise provide a benefit which has monetary value to those who would use alternative modes. These include: Alternative mode subsidies (incentives). Parking fees or surcharges (disincentives). HOV parking discounts for carpools or vanpools (incentives). Travel allowances (also includes parking "cash-out"), which allow the recipient to make the best travel choice given a discretionary budget, perhaps in lieu of free parking (normally func- tioning as incentives). Various gifts, drawings, prizes, or privileges that have a tangible monetary value (incentives). In this discussion, "incentives" will generally be used as shorthand for both incentives and disincentives. Incentives Insights from the 82-Program Sample Table 19-9 cross-classifies incentives used by the employers in the 82-program sample and presents the VTRs associated with each cross-classification and with each incentive category overall (the "All With Incentive" row). The sample data in the cross-tabulation frame a picture of the frequency with which particular incentives were used within the sample, alone or in combination. The VTR percentages illuminate their relative associations with apparent employee vehicle trip reductions. 19-41

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Note that restricted parking is included in this table, not because it is considered a financial incen- tive, but for the purpose of conditioning its importance in relation to other incentives. Individual Incentives. Focusing first on the bottom two rows of Table 19-9, it is possible to review the separate occurrence rate and impact differential for each incentive. Clearly the biggest differ- ential among the incentives shown is with parking pricing: The 31 programs that employed park- ing fees have an average VTR of 24.6 percent, which is double the 12.3 percent VTR for those sites with free parking. Of similar magnitude, in comparison with unpriced parking, is the effect of providing parking dis- counts for HOVs as part of parking pricing. Obviously, parking must first be priced in order for the discounts to be relevant, hence 22 of the 31 programs with parking fees also offered discounts for HOVs. These 22 programs exhibit an average VTR of 25.7 percent, which is 1.1 percentage points above the VTR for all 31 sites with parking fees and 13.4 percentage points greater than for the 51 sites with no parking pricing or discounts at all. Transit fare subsidies were the most commonly offered incentive, seen in over one-half of the examples. Programs with transit subsidies have the third largest impact in terms of VTR, with such programs exhibiting an average VTR of 20.6 percent, 7.5 percentage points higher than the 13.1 percent VTR in those programs not offering transit fare subsidies. The VTRs associated with vanpool subsidies in Table 19-9 suggest a curious inverse relationship, wherein programs that offered subsidies show up as less effective than those that did not (15.3 per- cent VTR versus 17.2 percent VTR). A deeper analysis of this finding--beyond that available in the table--reveals that of the 12 programs providing vanpool subsidies, six operated a vanpool pro- gram as a transportation service and six did not. The six with a vanpool service have an average implied VTR of 20.9 percent. The other six, which had a vanpool subsidy but not a vanpool ser- vice, average a VTR of only 9.8 percent. Hence, the effectiveness of the vanpool subsidy is more than doubled when combined with a formal vanpool service. Also relevant are the results for 16 employers who provided a vanpool transportation service but did not offer a separate and distinct vanpool subsidy. These sites had an average VTR of 19.8 per- cent, almost as high as programs that reported both a vanpool service and a vanpool subsidy. This dissection of the data suggests that vanpool service provision may be much more important than a separate subsidy. It may also be that the employer vanpool service programs contained one or more implicit subsidies. In any case, it is the inclusion of relatively more programs without van- pool operations in the Table 19-9 aggregation of employers offering vanpool subsidies that drags down the average VTR, not any inherent flaw in subsidization of HOV use. 19-42

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Table 19-9 Vehicle Trip Reduction Percentages Related to Monetary Incentives VTR by Type of Employer Incentive Offered (Sample Size) Parking HOV Transit Vanpool Carpool Bike/Walk Travel Other Other Incentive Fees Discounts Subsidy Subsidy Subsidy Subsidy Allowance Monetary All Restricted Parking 27.6% 29.8% 27.8% 36.2% 26.6% 30.4% 22.8% 29.9% 24.6% (26) (18) (23) (3) (3) (1) (12) (2) (35) Parking Fees 25.8% 27.6% 36.2% 24.7% n/a 23.8% 29.0% 24.6% (21) (21) (3) (2) (0) (12) (2) (31) HOV Parking Discounts 26.9% 36.2% 38.9% n/a 28.9% 29.0% 25.7% (16) (3) (1) (0) (8) (2) (22) Transit Subsidy 14.4% 20.5% 12.1% 26.2% 22.5% 20.6% (10) (3) (2) (8) (6) (42) Vanpool Subsidy 12.1% 12.1% 23.4% 9.7% 15.3% 19-43 (1) (1) (3) (2) (12) Carpool Subsidy 21.3% 24.7% n/a 23.0% (2) (2) (0) (4) Bike/Walk Subsidy n/a 12.1% 18.2% (0) (1) (3) Travel Allowance 26.2% 19.3% (4) (24) Other Monetary 23.1% (11) All with Incentive 24.6% 25.7% 20.6% 15.3% 23.0% 18.2% 19.3% 23.1% (31) (22) (42) (12) (4) (3) (24) (11) All without 12.3% 13.8% 13.1% 17.2% 16.6% 16.9% 16.0% 16.1% Incentive (51) (60) (40) (70) (78) (79) (58) (71) Note: Restricted parking is not a monetary incentive per se, but is included for comparison. Sources: Derived (see Appendix Table 19-A) from Comsis (1994), Comsis and ITE (1993), Rutherford et al. (1994), and Comsis et al. (1996).

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Table 19-9 shows that carpool and bike/walk subsidies were fairly uncommon, found at only four and three sites, respectively, although they are associated with above-average rates of VTR in the particular cases involved. The travel allowance and other monetary incentives are associated with above-average rates of VTR, while the comparable employers without those incentives have below-average VTRs. In these examples, the travel allowance only accounts for a 3.3 percentage point difference compared to programs not offering it, while the other monetary category accounts for a 7.0 percentage point difference. Incentive Combinations. The top portion of Table 19-9 illustrates VTR performance for incentive combinations found in the 82-program sample. There are many cases where the combined occur- rence of an incentive pairing is sufficiently uncommon that it shows a small sample size (three or less), and hence its average VTR performance must be treated with special caution. What seem to be the most frequent incentive combinations and their effective impacts follow: Parking fees (priced parking) together with restricted parking averages 27.6 percent VTR, while restricted parking overall and priced parking overall both average 24.6 percent. Parking fees with HOV parking discounts averages 25.8 percent VTR, slightly greater than parking pricing overall (24.6 percent). Programs including a transit fare subsidy (20.6 percent average VTR) have a lower VTR aver- age when combined with subsidies for competing modes, such as vanpool subsidies (14.4 per- cent) and bike/walk subsidies (12.1 percent). There is no clear explanation for this except possibly the small sample sizes (two to three programs) when in combination with carpool and bike/walk subsidies. In any case, the VTR is virtually undiminished when combined with carpool subsidy (20.5 percent), and is enhanced when combined with the travel allowance (26.2 percent) and other monetary incentives (22.5 percent). The travel allowance does better than its average program VTR of 19.3 percent in all combina- tions with other incentives, including transit (26.2 percent), vanpool (23.4 percent), and carpool subsidies (24.7 percent), and also works better with parking fees (23.8 percent) or restricted parking (22.8 percent). Other monetary incentives (23.1 percent) appear to be enhanced when teamed with restricted parking (29.9 percent), parking fees (29.0 percent), HOV parking discounts (29.0 percent) and travel allowance (26.2 percent), but show less impact when teamed with transit (22.5 percent), vanpool (9.7 percent), or bike/walk subsidies (12.1 percent). One is tempted to wonder if the relatively poor VTR showing for several modal subsidy combina- tions is a reflection of lack of program focus. There is, unfortunately, no data to either support or reject such speculation. Small program sample sizes in the case of several combinations together with the inherent variability among program circumstances remain more obvious potential explanations. Effects Without Restricted or Priced Parking. It is generally acknowledged that parking conditions at a work site have a major underlying effect on the success of TDM programs. Where parking sup- ply is limited or restricted (Chapter 18, "Parking Management and Supply") or where it is not free (Chapter 13, "Parking Pricing and Fees"), the desire of employees to find and use alternatives is demonstrably more urgent. To test this effect in the analysis of incentive measures, Table 19-10 sum- marizes the performance of those 27 programs that offered incentives but had no restrictions on parking. As a group, these 27 programs have an average VTR of 14.3 percent, which is less than the overall average for the 82-program sample of 16.9 percent. In addition, in a direct cell-by-cell com- 19-44

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parison of Table 19-10 with Table 19-9, the combinations without restricted or priced parking exhibit a lower VTR in each case with data available where the included examples are not identical. On the other hand, the 14.3 percent overall average VTR for the 27 programs without restricted/ priced parking is greater than the average VTR of 7.0 percent for the 14 programs that had unre- stricted parking and also did not offer subsidies. The four employers in the 82-program sample who had restricted/priced parking but did not offer subsidies have an average VTR of only 11.5 percent. The 37 employers who had both restricted/priced parking and offered subsidies have an average 23.3 percent VTR. Table 19-10 Vehicle Trip Reduction Percentages Related to Monetary Incentives in the Case of Programs Without Restricted or Priced Parking VTR by Type of Employer Incentive Offered (Sample Size) Vanpool Carpool Bike/Walk Travel Other Other Incentive Subsidy Subsidy Subsidy Allowance Monetary All Transit Subsidy 8.7% 12.1% 12.1% 18.3% 18.5% 13.5% (8) (1) (2) (3) (5) (21) Vanpool Subsidy 12.1% 12.1% 5.6% 9.7% 8.4% (1) (1) (1) (2) (9) Carpool Subsidy 21.3% n/a n/a 21.3% (2) (0) (0) (2) Bike/Walk Subsidy n/a 12.1% 18.2% (0) (1) (3) Travel Allowance 26.2% 14.8% (4) (12) Other Monetary 21.7% (9) Note: Overall average VTR is 14.3 percent for these 27 programs without restricted or priced parking. See text for other aggregations. Sources: Derived (see Appendix Table 19-A) from Comsis (1994), Comsis and ITE (1993), Rutherford et al. (1994), and Comsis et al. (1996). Incentives in Conjunction with Other Site Conditions or TDM Strategies Table 19-11 provides an assessment of how the various incentive strategies influence or are aided by other site conditions or TDM strategies. Once again, the 82-program sample is drawn upon. 19-45

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Table 19-11 Vehicle Trip Reduction Percentages Related to Monetary Incentives and Other Site Programs or Conditions VTR by Type of Incentive Offered (Sample Size) Parking HOV Transit Vanpool Carpool Bike/Walk Travel Other Other Pricing Discounts Subsidy Subsidy Subsidy Subsidy Allowance Monetary Conditions With W/out With W/out With W/out With W/out With W/out With W/out With W/out With W/out All All 24.6% 12.3% 25.7% 13.8% 20.6% 13.1% 15.3% 17.2% 23.0% 16.6% 18.2% 16.9% 19.3% 16.0% 23.1% 16.1% 16.9% (31) (51) (22) (60) (42) (40) (12) (70) (4) (78) (3) (79) (24) (58) (11) (71) (82) Transit Availability High 27.0% 18.9% 26.4% 25.1% 27.4% 22.5% 26.2% 25.9% n/a 26.0% n/a 26.0% 20.3% 26.8% 38.2% 24.9% 26.0% (21) (3) (16) (8) (17) (7) (3) (21) (0) (24) (0) (24) (5) (19) (2) (22) (24) Medium 13.7% 8.0% 19.0% 9.6% 11.2% 13.6% 10.5% 13.5% 20.5% 10.5% 12.1% 12.1% 19.6% 7.7% 15.0% 11.5% 12.1% (8) (10) (5) (14) (12) (7) (3) (16) (3) (16) (2) (17) (7) (12) (3) (16) (19) Low 47.4% 12.9% 47.7% 12.9% 20.3% 10.5% 10.5% 14.4% 30.4% 13.3% 30.4% 13.3% 17.6% 12.1% 22.0% 12.3% 13.8% (2) (38) (1) (38) (13) (26) (6) (33) (1) (38) (1) (38) (12) (27) (6) (33) (39) Level of Support 19-46 High 24.4% 12.5% 23.7% 16.6% 22.8% 15.7% 14.9% 19.6% n/a 19.0% n/a 19.0% 20.7% 18.1% 17.3% 19.5% 19.0% (15) (17) (11) (21) (15) (17) (4) (28) (0) (32) (0) (32) (11) (21) (7) (25) (32) Medium 27.3% 12.9% 31.9% 13.1% 20.4% 11.7% 11.5% 17.1% 27.1% 14.8% 18.2% 15.7% 20.9% 14.3% 33.1% 13.6% 15.9% (7) (26) (5) (28) (16) (17) (7) (26) (3) (30) (3) (30) (8) (25) (4) (29) (33) Low 22.8% 9.6% 24.0% 10.2% 17.8% 10.0% 44.2% 13.2% 10.5% 15.3% n/a 15.0% 13.6% 15.6% n/a 15.0% 15.0% (9) (8) (6) (11) (11) (6) (1) (16) (1) (16) (0) (17) (5) (12) (0) (17) (17) Transportation Services Transit 35.3% 2.6% 35.3% 2.6% 35.3% 2.6% n/a 18.9% n/a 18.9% n/a 18.9% 21.1% 16.7% 42.4% 11.1% 18.9% (2) (2) (2) (2) (2) (2) (0) (4) (0) (4) (0) (4) (2) (2) (1) (3) (4) Vanpool 34.1% 10.7% 34.1% 10.7% 25.0% 17.0% 23.1% 20.3% n/a 21.3% n/a 21.3% 30.7% 17.8% 13.8% 22.1% 21.3% (5) (6) (5) (6) (6) (5) (4) (7) (0) (11) (0) (11) (3) (8) (1) (10) (11) Both 23.6% 16.1% 38.0% 14.5% 30.2% 9.3% 16.0% 19.3% 42.4% 16.4% n/a 18.8% 3.4% 20.0% n/a 18.8% 18.8% (4) (7) (2) (9) (5) (6) (2) (9) (1) (10) (0) (11) (2) (9) (0) (11) (11) Co. Veh's. 36.6% 14.6% 34.8% 18.9% 34.4% 7.6% 16.4% 27.5% 38.9% 23.2% n/a 26.2% 40.0% 15.9% 20.7% 23.8% 24.6% (5) (6) (4) (7) (7) (4) (3) (7) (1) (7) (0) (9) (4) (7) (2) (9) (11) No Serv's. 18.2% 11.3% 15.6% 13.1% 13.1% 14.2% 5.8% 14.3% 17.7% 13.4% 18.2% 13.3% 13.5% 13.7% 19.2% 12.5% 13.6% (16) (32) (10) (38) (24) (24) (4) (44) (3) (45) (3) (45) (14) (34) (8) (40) (48) Sources: Derived (see Appendix Table 19-A) from Comsis (1994), Comsis and ITE (1993), Rutherford et al. (1994), and Comsis et al. (1996).

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Level of Transit Availability. Across the board, programs located in proximity to good transit service outperform those with medium to poor service. The 24 programs of all types favored with high transit availability have an average VTR of 26.0 percent, compared to only 12.1 percent for those with medium availability and 13.8 percent for those with low availability. Given a compar- ative advantage of high transit availability, particular incentives then either enhance or lessen VTR--or have negligible additional effect--based on their compatibility with transit use. For example, parking pricing further encourages transit use. Programs with high transit availabil- ity and parking fees have an average VTR of 27.0 percent versus only 18.9 percent without priced parking. At the same time, offering parking discounts for HOVs is hardly an incentive to use tran- sit, and accordingly there is only a small difference in VTR with or without the incentive (26.4 per- cent versus 25.1 percent). The same is true for vanpool subsidies, where the difference is 26.2 percent VTR with, versus 25.9 percent without. In high transit availability cases transit subsidies are, logically, associated with a higher VTR (27.4 percent) than programs with no transit subsidies (22.5 percent). In the case of other mone- tary incentives, for whatever reason, the difference is even larger (38.2 percent with such incen- tives versus 24.9 percent without). No programs in the sample were observed to provide carpool or bike/walk subsidies in areas with high transit availability. Programs in areas with medium or low transit availability also show positive impact on VTR from application of incentives like parking pricing, transit subsidies, and other monetary measures. Parking discounts for HOVs show a positive effect on VTR in the medium and low availability cases, illustrating the greater importance of HOV benefits where the transit alternative is less attractive. The travel allowance cases produce a somewhat curious result in that they show posi- tive impacts on VTR for medium and low availability cases, but a negative effect where transit availability is high. Generally, the travel allowance provides for maximum user choice, and where transit service is at a maximum, one would expect that transit would be a preferred alternative. Level of Employer Support. At all levels of employer support--from high to low--there is gener- ally a demonstrably positive effect on VTR performance by providing incentives. This is certainly the case with regard to parking pricing, HOV parking discounts, and transit subsidies, and is true in most cases for carpool and bike/walk subsidies, travel allowances, and other monetary incen- tives. In the case of parking pricing, the effect on VTR seems to be almost independent of level of support, with low support programs registering a 22.8 percent VTR compared to 24.4 percent for high support programs, and both substantially higher than the equivalent programs without park- ing pricing (9.6 percent and 12.5 percent, respectively). HOV parking discounts and transit subsi- dies have a similar effect of increasing trip reduction almost independent of level of support, even though level of support shows a measurable VTR difference between high and low programs. Travel allowances seem to work better in combination with high or medium support levels and more poorly with low support levels. Oddly enough, in the 82-program sample, other monetary measures are associated with higher VTRs in the instance of medium support levels than they are in combination with high support levels. Transportation Services. Once again, several of the financial incentives have a demonstrable, pos- itive effect on the VTR performance of employer programs, in this case with respect to programs that provide transportation services. Parking pricing, HOV parking discounts, and transit subsi- dies again show evidence of a major additional VTR impact when combined with the respective transportation service. A number of combinations involve particularly low program sample sizes, however, requiring extra caution vis--vis individual VTR percentages. 19-47

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Employer-enabled transit service, when combined with parking pricing, shows an average VTR of 35.3 percent compared to only 2.6 percent when parking is not priced. The differential is 34.1 per- cent with pricing versus 10.7 percent without when vanpool programs are the service provided, 23.6 percent versus 16.1 percent for combined transit and vanpool programs, and 36.6 percent ver- sus 14.6 percent for service programs offering use of company vehicles. These VTR performance attainments exceeding 20 to 30 percent when parking pricing is applied contrast substantially not only with those programs that do not price parking, but also with programs that do not provide services, where VTR averages only 18.2 percent when parking is priced. These findings suggest an important combined benefit for mixing these two types of strategies. The same situation is evident for HOV parking discounts in combination with services and for transit subsidies with services. The various combinations appear to yield a much larger impact than either the monetary strategy or the transportation services strategy acting independently. Additional Evidence of Transportation Incentive Effects Parking Supply and Pricing. As revealed in the preceding analysis, the supply and price of park- ing serving a worksite have the single largest effect on the performance of employer-based TDM programs. Not only does limited parking or the existence of parking fees discourage solo driving outright, but such conditions also tend to increase the appeal of travel alternatives and other TDM strategies. Providing corroboration, a study of six San Francisco Medical Institutions found that the monthly charge for employee on-site parking was the single most influential factor in deter- mining employee drive-alone rates. The monthly parking charge at each institution was also found to be highly correlated to the severity of off-site parking restrictions and the abundance of transit service (the second and third most important factors after parking pricing). An increase of $8 per month in employee parking charges was found to be necessary to decrease employee SOV mode split rates by one percentage point (Dowling, Feltham, and Wycko, 1991). Because parking has such a powerful role, it is the exclusive subject of Chapter 13, "Parking Pricing and Fees," and Chapter 18, "Parking Management and Supply." These chapters offer substantially more information on the key role played by parking in employer and institutional TDM programs. In particular, see Table 13-22, "Relationship Between Parking Pricing and/or Subsidies and Vehicle Trip Rates at Employment Sites," and associated narrative, in conjunction with parking pricing. Likewise, see especially Table 18-8, "Parking and Transportation Characteristics at Six San Francisco Medical Institutions," in relation to parking supply. Beyond the lessons of Chapters 13 and 18, further insight on the impact of parking and other finan- cial incentives may also be derived from the 82-program sample, drawing upon the information on the composition of individual programs in Appendix Table 19-A. A subgroup of 56 sites, which incorporated some combination of financial incentives into their programs, has been extracted and tabulated in Table 19-12. 19-48

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Table 19-12 Transportation Incentive Programs from the 82-Program Sample Restricted Parking HOV Parking Travel Transit Other Other Employer Parking Fees Discounts Cash Out Allowance Subsidy Subsidy Incentives VTR Aetna Hartford CT Yes TR subsidy $21/mo. VP Program 0% Allergan 50% 100% VP Rideshare 13.8% Days Off, Raffles Atlantic Richfield Yes $87/mo. 50% CP2 $15/mo. Subsidized 34.5% Company Los Angeles Free HOV3+ VP Program Arlington Heights, IL $500/yr. $500/yr. Time Off 12.1% AT&T Silver Spring Yes Yes Yes 24.0% Bellevue, WA, City Hall Yes $30/mo. Yes Yes VP $25/mo. 30.0% CP/TR $15 Bonneville Power Adm. Yes $25-40/mo. $21/mo. 25.6% 19-49 Boulder, CO, Hospital Yes Yes 14.1% Broadway Plaza 1 Yes Yes Yes 50% 5.6% Broadway Plaza 2 Yes Yes Yes 100% 15.4% Brown & Bain $25-50/mo. 25% 50-75% 5.7% CA Franchise Tax Board $15/mo. $25/mo. VP 5.6% Cedars Sinai Hospital Yes Yes Yes 12.6% CH2M Hill - Bellevue Yes $56/mo. Yes . $40/mo. $15/mo. $15/mo. 38.9% Chubb Insurance VP Program Raffles 5.4% City of Pleasanton, CA $1/day 25% 25% VP Raffles 5.6% City of Simi Valley, CA $2-3/day $0.75/day Bike Equip. Time Off 43.5% City Place Mall Yes Yes Yes 26.7% City/County of Denver Yes Yes Yes Yes CP & VP 19.8% Commuter Transp. Svcs. $50/mo. $40/mo. 17.5% Comsis Corp. Yes Yes $60/mo. County County 10.5% (continued on next page)

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Table 19-12 (Continued) Restricted Parking HOV Parking Travel Transit Other Other Employer Parking Fees Discounts Cash Out Allowance Subsidy Subsidy Incentives VTR Cornell University Yes Yes Yes Yes 13.3% GEICO Yes Yes Yes Yes 14.1% Gotcha Sportswear Time Off 34.1% G-Street Fabrics Yes 11.8% Hartford Steam Boiler Yes $110/mo. CP2 $75 $10-30/mo. $10-30/mo. 36.4% CP3 $40 Vanpool CP4+ $10 Heller Financial $55/mo. HOV3 Free Time Off 15.6% Hillsborough Co., FL 50% 3.4% IT Corp. Irvine, CA 100% $50/mo. Ped. Annual 12.1% Drawing 19-50 Johnson & Higgins Yes $180/mo. $10/mo. 44.2% Kirkland, WA, City Hall $125/mo. 16.3% Lawrence Livermore $20/mo. 17.4% Nat. Optical Observat. 50% 39.8% Nike Beaverton, OR Yes 50% $1/day 5.7% NOAA Yes Yes Yes 36.0% Nuclear Reg. Comm. Yes $60/mo. Yes 30.6% P. L. Porter $15/mo. 23.0% Pacific Pipeline Yes $24/mo. 15.1% Pasadena City Hall Yes Yes Yes Yes Yes 18.5% Puget Sound Blood Yes Yes $25/mo. 50% 1 day/mo. 42.4% Center discount Free park Rick Engineering $25/mo. $25/mo. 9.4% Rockbestos Vanpool 29.0%

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Table 19-12 (Continued) Restricted Parking HOV Parking Travel Transit Other Other Employer Parking Fees Discounts Cash Out Allowance Subsidy Subsidy Incentives VTR San Diego Trust Yes Yes Yes $60/mo. 22.7% Shur-Lok Corp. $21/mo $10-20/mo. 12.1% CP $25/wk. VP Bike/Walk So. California Gas Yes Yes Yes $50/mo. $60/mo. 47.4% State Farm Insurance Paid to not 30.4% park Swedish Hospital Yes $44/mo. $22/mo. 100% Yes 28.2% TransAmerica Yes $62/mo. $10/pool + $15/mo. 18.8% $15/addt'l. 19-51 passenger Travelers - Hartford Yes $25/mo. $15 CP2 $15/mo. $20/mo. VP 44.2% Free CP3+ (Program) Univ. of Washington Yes Yes Yes Yes Yes 62.0% US West Bellevue Yes $60/mo. $45 CP2 Yes Bike Equip. 31.3% Free CP3+ Rebates Varian Yes 25% Awards 17.4% Ventura Co., CA $1/day for 13.3% not driving W. H. Mercer $130/mo. $91/mo. 100% 100% Ferry 22.7% Walker Richer & Quinn 100% 60% VP or 0% Ferry Warner Center Hilton $15/mo. $15/mo. 43.7% Notes: CP = Car Pool, VP = Van Pool, TR = Transit. Source: Appendix Table 19-A.

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The data in this table not only provide a guide as to which sites have used particular incentives, but also help illustrate how varied the combination of incentive strategies is in practice. This variabil- ity, plus lack of uniformity in the way the various incentives are defined or measured, demonstrates why it has been difficult to isolate the contribution of individual incentive strategies. In relation to parking, previous analysis indicated that those 39 sites with restricted and/or priced parking achieved an average VTR of 24.1 percent, versus 12.2 percent for those without parking controls. One way in which the incentive effect of parking pricing can be increased is by teaming it with strategies that further magnify the cost advantages of shifting travel modes. Two such strategies that have close linkages with parking pricing are parking discounts for HOVs and park- ing cash-out. HOV Parking Discounts. HOV parking discounts offer employees who rideshare an additional cost advantage through reduced parking rates. Frequently these discount rates are scaled to the number of occupants, with HOVs of 3 or more often parking for free or at nominal cost. Sites in Table 19-12 that employed HOV parking discounts include: Atlantic Richfield Company--Los Angeles (34.5 percent VTR), Bellevue City Hall (30.0 percent), Broadway Plaza 1 (5.6 percent), Broadway Plaza 2 (15.4 percent), CH2M Hill (38.9 percent), City and County of Denver (19.8 per- cent), Hartford Steam Boiler (36.4 percent), Heller Financial (15.6 percent), Pasadena City Hall (18.5 percent), Puget Sound Blood Center (42.4 percent), San Diego Trust and Savings (22.7 percent), Southern California Gas (47.4 percent), Swedish Hospital (28.2 percent), TransAmerica (18.8 percent), Travelers Insurance (44.2 percent), the University of Washington (62.0 percent), US West (31.3 per- cent), and Wm. H. Mercer (22.7 percent). This combination of balancing fee-based disincentives with positive incentives has a clear impact on the success with which these programs reduce vehicle trips. Table 19-12 provides detail on the combination of strategies and circumstances which are at play in each of the examples and there is additional information in Appendix Table 19-A. Parking Cash-out. Another strategy that works in tandem with parking pricing is parking cash- out, in which employees are given the option of exchanging the privilege of a free parking space for the cash equivalent, which they may then use flexibly to defray the cost of other transportation options including transit, walking, or biking. Such cash-out programs work best when employers are paying separately for parking, or where there is a parking shortage. The 82-program sample does not have many examples of parking cash-out as it is a relatively new TDM strategy. Only the City of Pleasanton, California, and Cedars Sinai Hospital officially cited cash-out programs. Aetna Insurance provided a $21 monthly transit subsidy in exchange for the employee's parking space, and State Farm Insurance in Orange County, California, took the unusual approach of paying employees not to park by offering cashable scrip linked to travel mode. There are various studies of parking cash-out covered in Tables 13-12 through 13-14 of Chapter 13, "Parking Pricing and Fees." A 1997 study of eight parking cash-out programs in California found that total vehicle trips declined by 17 percent on average after a parking cash-out option was intro- duced at various urban and suburban work sites. This outcome was achieved by a reduction in drive-alone share from 76 to 53 percent, coupled with an increase in carpooling from 14 to 23 per- cent, transit from 6 to 9 percent, and bike/walk from 3 percent to 4 percent (Shoup, 1997). Alternative Mode Subsidies. While parking has a powerful effect on vehicle trip making, its prin- cipal drawback is that it is very unpopular to implement proactively as a strategy. For employers located in areas with already restricted parking, pricing is more likely to be accepted as a fact of life for commuters. The one major difficulty would be in removing an existing parking subsidy when commuters have become accustomed to it. In contrast, in suburban areas where parking is generally not constrained, it is difficult to institute pricing without fearing a competitive dis- 19-52

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advantage and loss of employees. Subsidies represent an important alternative way to use travel cost as a TDM strategy, since they encourage a desired behavior rather than discourage an undesired behavior. Of course, used in tandem, their effect is complementary, and the subsidy may allow the employer to also implement controls on parking. Parking fees, in turn, can provide the revenue source to fund the subsidies. Federal and state tax incentive changes have made alternative mode subsidies more attractive for both employers and employees. Since 1984, Section 132(f) of the Internal Revenue Service (IRS) Code has authorized special treatment for commuter benefits. Initially, the law permitted employers to provide employees with a tax-free transit subsidy of up to $15/month. Meanwhile, employer- provided parking benefits had always been and remained fully tax exempt. Over time, the scope and amount of the alternative mode tax benefits have been steadily expanded. A major change occurred in conjunction with the Energy Policy Act of 1992 that raised the monthly employee tax- free transit subsidy limit to $60, included vanpools as an eligible mode, put a first-time ceiling on employer-provided parking of $155/month, and provided for inflation indexing. By early February of 2009, the non-taxable monthly transit/vanpool subsidy limit was $120, as compared to $230 per month for parking. Transit/vanpool and auto commute mode federal tax treatment was equalized for the first time with the signing on February 17, 2009, of The Emergency Economic Recovery Act. This law raised to $230 per month the pre-tax income that employees in employer-sponsored commuter benefit pro- grams can apply to payment for use of these alternative modes (TransitCenter, 2009). The tax deduc- tion equalization does not extend to non-motorized transport, but there now exists a similarly applied $20 per month tax allowance for bicycling expenses (Los Angeles County Metropolitan Transportation Authority, 2009). Note that the timing of these new equalization and bicycling pro- visions is such that no program results reported in this chapter reflect these latest tax benefit enhancements.8 A number of states have also implemented tax incentive programs to encourage employers to provide transit or vanpool benefits to employees. These programs generally work to enhance cost savings for businesses. Examples range from a $25 annual tax credit for each employee receiving a commuter benefit in Georgia to $30 per employee per month for specified alternative mode benefits in Maryland (U.S. Environmental Protection Agency, 2005). Transit Vouchers/Passes/Discounts. The easiest way to convey this employer subsidy is through transit vouchers or passes. Many metropolitan transit agencies actively administer transit pass pro- grams designed to facilitate employers' efforts to provide subsidies to employees. A popular medium used in places like Philadelphia and New York City is TransitChek, in which an agreement between the employer and the transit agency provides employees with vouchers that can be used to buy tokens, tickets or passes from public or private transit operators (Comsis et al., 1996). Both Portland's TriMet and Seattle's King County Metro offer a similar set of instruments to entice employers and institutions to cost share in employees' or students' alternative mode costs. Both the Portland and Seattle transit agencies market passes to private employers and universities by offering introductory discounts, although the primary discounting for the user is provided by 8 During publication preparations for this chapter it was announced that direct federal grants (as contrasted to tax deductions) are being made through the new Energy Efficiency and Conservation Block Grant Program to government entities for, among other things, use in incentive programs to reduce commuting with single- occupancy vehicles (Institute of Transportation Engineers, 2009). 19-53

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the employer/institution. Both agencies also offer a special instrument and program to employers who are required under state regulations to reduce vehicle trips. Metro credits its proactive pass programs with increasing regional use of non-SOV modes--principally transit, but also vanpool, carpool, and non-motorized--from 4.7 million to 6.7 million annual trips between 1997 and 1999. With its FlexPass program, Metro targeted 433 King County employers affected by the Commute Trip Reduction law. As of 2000, 120 employers were participating in the program, representing 80,000 employees, who took over 7 million transit trips in 2000. Over 2,300 vanpool riders also received an employer subsidy via their FlexPass in 2000 (Hansen and Slachowitz, 2001). Some examples of subsidized transit pass efforts and the reported outcomes include the following (Comsis et al., 1996, or as indicated): First Hill (Seattle): A program serving employers in this area led to doubling of riders in a 12-month period. Of new riders, 60 percent formerly drove alone. Denver/Boulder: A total of 132 companies generated 9,648 new riders from introduction of an ECO Pass Program. Charlotte Uptown Council: A program of transit passes combined with other TDM measures gave employees at eight companies a choice between subsidized transit passes or parking. Transit ridership increased by 800 riders between 1989 and 1991. Cornell University: Discount passes to commuters living outside Tompkins County, combined with parking pricing, reduced vehicles parked on campus by 26 percent. University of Washington: The U-PASS discount program combined with more intensive bus service and higher parking fees increased the transit mode share by 81 percent (17 percentage points) and led to a 31 percent VTR as measured over the 19892004 period (see "University of Washington's U-PASS Program--Seattle, Washington" case study). AM peak period traf- fic counts taken in 2002 were 18 percent below 1983 levels (Association for Commuter Transportation et al., 2004). A transit pass program for Husky Stadium (free transit scrip for all ticket purchasers plus new park-and-ride services) increased game attendee transit share from 29 percent to 34 percent and dropped the auto mode share from 71 percent to 66 percent (Comsis et al., 1996). University of California (Los Angeles): Provision of an unlimited-access pass program, in the first year of promotion, increased commuting to campus via transit by 56 percent, decreased solo driving by 20 percent, and released at least 1,020 parking spaces (Georggi et al., 2007). Ann Arbor: A discounted or free transit pass program (depending on level of employer involve- ment), introduced to employees in the downtown between 2000 and 2001, reduced vehicle trips by 3.5 percent while bus passenger trips increased by 9.2 percent (Association for Commuter Transportation et al., 2004). Reflecting again on the 82-program sample of employers provides additional insights on the role and impact of transit subsidies. Individual program examples featuring transit subsidies as their princi- pal financial incentive measure have been selected from the tabulation for listing in Table 19-13. (This comparison is different from the Table 19-12 subsample because it takes transit availability into account.) An argument can be made that the impact of transit subsidies is likely to be greater if, in fact, there is good-to-reasonable transit service available to the site. Based also on the evidence that 19-54

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parking constraints (supply or pricing) have a strong disincentive effect on driving, the sample of sites has been divided into three groupings that are distinguished in relation to both transit avail- ability and restricted parking. Table 19-13 Comparative Impact of Transit Subsidies in Relation to Parking Controls and Transit Availability (VTR in Parentheses) Medium and High Transit Availability (VTR) Low Transit Availability (VTR) Restricted/Priced Parking Free Parking Free Parking AT&T Silver Spring (24.0%) Aetna (0%) Arlington Hts., IL (12.1%) Bellevue City Hall (30.0%) Boulder Hospital (14.1%) Baxter Health Care (-3.3%) Bonneville Power (25.6%) G-Street Fabrics (11.8%) California Franchise Tax Board (5.6%) City Place Mall (26.7%) IT Corporation (12.1%) Dean Witter (5.4%) Hartford Steam Boiler Hillsboro County (3.4%) (36.4%) GTE Systems (-3.3%) Shur-Lok Corp. (12.1%) Johnson & Higgins (44.2%) Nike (5.7%) Walker Richer & Quinn (0%) NOAA (36.0%) Rick Engineering (9.4%) Nuclear Reg. Comm. (30.6%) Washington Adventist Hospital. (-12.7%) Swedish Hospital (28.2%) W. H. Mercer (22.7%) (Average VTR = 30.4%) (Average VTR = 7.6%) (Average VTR = 2.4%) Note: A negative VTR implies that the sample program(s) had vehicle trip rates that were actually greater than the average from the surrounding area with which they were compared. Source: Appendix Table 19-A. In the Table 19-13 listing, those programs offering transit subsidies in the presence of both good transit and restricted parking have a significantly higher VTR (30.4 percent) than those with good transit but free parking (averaging a 7.6 percent VTR) or those with both free parking and limited transit availability (averaging a 2.4 percent VTR). Other details associated with these pro- grams are found in Appendix Table 19-A. A somewhat different take on the same question of transit pass program effectiveness in relation to the quality of transit service has been tested using Employee Commute Options survey data in Portland, Oregon. The researchers used a multiple regression approach to explore the relative importance of a list of employer-provided incentives--including particularly the transit agency's PASSport program--on employee transit mode share. TriMet's PASSport (introduced earlier in this section) allows employers to purchase transit passes for all employees at a cost based on only the number of employees who actually use transit. 19-55

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The analysis, in addition to reflecting whether or not an employer offered PASSport to its employees and the proportion of cost paid by the employer, also considered the effects of transit proximity (within 1/4 mile of either a light rail transit (LRT) station or a frequent bus route), street connectiv- ity (using an intersection ratio), and location of the worksite (in or out) in relation to Portland's "Fareless Square," a free transit zone covering downtown Portland and adjacent Lloyd Center. A dummy variable was used to reflect the offering of one or more other incentives such as flextime, CWW, guaranteed ride home, or company car (Dill and Wardell, 2007). At the top of the list of key findings was that the location of an employer within the Fareless Square accounted for a 26 percentage point difference in transit mode share relative to employers not so located. (Note that the Fareless Square provides free transit rides internal to the zone but not for riding into the zone from outside or vice-versa.) As modeled on the full, unstratified data set, offer- ing PASSport contributed 6.9 percentage points to transit mode share. Being within 1/4 mile of an LRT station added 4.1 percentage points, while being within 1/4 mile of frequent bus added 1.8 percentage points. Ideal street connectivity, relative to the worst encountered, added about 3.7 percentage points taking the variable construct into account. Part of the reason that the Fareless Square was such an important determinant is thought to be its "urban" characteristics such as priced parking (on- and off-street) and more compact (and typi- cally mixed-use) development patterns. When the study sample was split based on location rela- tive to the Fareless Square, the PASSport incentive became worth 11.8 percentage points of transit share inside the fare-free zone versus 5.4 percentage points outside. Similarly, if the sample is split based on location within 1/4 mile of LRT, PASSport is worth 12 percentage points in transit share inside of the 1/4 mile range versus only 3.5 percentage points outside. Basically, the PASSport incentive has the greater effect on transit mode share where the employment location is more urban (with parking fees) and/or the transit service is better (Dill and Wardell, 2007). Vanpool and Other Subsidies. Transit subsidies are clearly the most common alternate mode sub- sidies, in large part because of the favorable tax treatment they receive. Extension of comparable tax treatment to vanpools has increased the attractiveness of subsidy incentives to that mode, although most of these programs are already implicitly subsidized through the employer-provided vanpool program. Within the 82-program sample, 21 employers were identified as operating or facilitating an employee vanpool program. Employer-defrayed or shared costs in such areas as vehicle acquisition/financing, maintenance, insurance, fuel, and the like, already discussed under "Response to Employer Transportation Services"--"Employer-Assisted Vanpool Service," consti- tute in-kind subsidies. Monetary subsidies differing from these in-kind discounts may consist of vanpool-driver subsidies (to attract good volunteer drivers), empty-seat subsidies (to maintain a reasonable average fare level), or start-up subsidies. Only seven of the 82 employers offered a vanpool subsidy among their incentives without actu- ally operating a vanpool program: Bellevue City Hall, California Franchise Tax Board, the City of Pleasanton, City and County of Denver, Hartford Steam Boiler, Shur-Lok Corporation, and Walker, Richer & Quinn. In all of these seven cases, the stand-alone vanpool subsidy was offered along with a transit subsidy and often other financial incentives, such that its effect is difficult to separate. It is judged to be minimal. Targeted subsidies to modes other than transit or vanpool are less common, probably because they have not been receiving favorable tax treatment. The sparse data make it difficult to generalize the traveler response. An example that does provide results for incentives as applied to various individ- ual modes is the 1970s TVA program outlined earlier under "Response to Employer Transportation Services"--"Additional Evidence of Transportation Services Effects"--"Transportation Brokerage." 19-56

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Table 19-8 listed the mode shares obtained before and after each stage of the program. The TVA example, although dated, is of particular interest because the transportation services were imple- mented as a first stage, and the incentives were provided as a second stage, allowing the impact of the incentives to be viewed in at least partial isolation. Table 19-14 is designed to illuminate this additional perspective on the TVA results by highlighting the incremental percentage point changes in mode shares attained with incentives as contrasted to the initial mode shifts achieved with transportation services alone. Incentives included bus and vanpool fare subsidies and inexpensive parking for carpools. (Otherwise it is inferred that parking prices appropriate to the downtown location applied.) Table 19-14 Mode Shifts by Stage of the TVA Transportation Brokerage Program Percentage Point Mode Share Changes Drive Car- Van- Express Regular Nature of Effect by Stage Alone pool pool Bus Bus Other Combined effect of transportation services -23% +10% +2% +11% 0% 0% (without incentives) and first 1970s gas crisis Additional (incremental) effect of incentives -24% +1% +5% +17% 0% +1% along with transportation services increases to meet increased demand Source: Adapted from Wegmann, Chatterjee, and Stokey (1979). Response to the initial stage, services without incentives, was given an unexpected boost by the first 1970s fuel crisis and associated gasoline price increases. The second 1970s gas crisis was late enough in the decade that it did not occur between measurement of first stage results without incentives and measurement of the second-stage results with incentives (Pratt and Copple, 1981). This timing makes the shifts in response to incentives all the more notable. Table 19-14 makes it clear that the mode shifts obtained for the vanpool, express bus, and other alternative modes, as well as the net effect on driving alone, were larger for the addition of incen- tives than for the original provision of transportation services. Only carpooling and regular bus ridership were largely insensitive to the incentives, perhaps because other alternative modes became more attractive. Although the effects of incentives were not boosted by additional gaso- line price increases, they undoubtedly were enhanced by the vanpool and express bus service increases necessitated by the sheer volume of new users. Some of the incentives would have been worthless without the provision of transportation services. Prior to the program there was no express bus service or vanpool offering at all. Typically, carpool subsidies are conveyed via a more general instrument, such as HOV parking discounts, parking cash-out, or transportation allowances, and--as with vanpool subsidies pro- vided independent of a vanpool program--tend to be part of a broad package of financial and other incentives. The same is true with subsidies for biking, walking or other modes like ferry. In these situations too few observations are available or too many other measures are being applied to allow clear-cut attribution of impact to the subsidy. 19-57

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Transportation Allowances. A transportation allowance is similar in function to parking cash- out in that it provides a sum of money that can be used at the employee's discretion toward the cost of his/her own chosen option, though the amount is not necessarily related to the employer's cost for parking. In the 82-program sample, 10 employers used some variation of parking cash- out or transportation allowances as part of their program. These 10 cases are among those detailed in Table 19-12. It is instructive to examine them with regard to how their program success may be related to the measures they applied: Southern California Gas (47.4 percent VTR), offered a $50/month Travel Allowance in conjunc- tion with parking fees and HOV parking discounts. City of Simi Valley, California (43.5 percent VTR), used a $2$3/day travel allowance, plus a $0.75/day bus subsidy, and a CWW policy with 90 percent employee participation. CH2M Hill in Bellevue, Washington (38.9 percent VTR), provided a $40/month travel allowance, plus a $15 subsidy for transit or carpool users, and restricted/priced parking. Atlantic Richfield Company in downtown Los Angeles (34.5 percent VTR), offered a $15/month travel allowance in conjunction with restricted and priced parking. Commuter Transportation Services in Los Angeles (17.5 percent VTR), used a $40/month travel allowance combined with parking fees. Kirkland, Washington, City Hall (16.3 percent VTR), had a $25/month travel allowance and parking fees. Pacific Pipeline (15.1 percent VTR), gave a $24/month travel allowance if an alternative mode was used at least 60 percent of the time, in a context of restricted/priced parking. Cedars Sinai Hospital in Los Angeles (12.6 percent VTR), used a parking cash out policy in con- junction with restricted and priced parking. Nike of Beaverton, Oregon, offered $1 per day for alternate mode use, but presumably because its parking was unpriced and unrestricted, its VTR was only 5.7 percent. Similarly, the City of Pleasanton, California, offered a $1/day cash-out incentive, but with unpriced and unrestricted parking, its VTR was only 5.6 percent. Financial Incentive Experimentation. An experiment in Atlanta motivated by air quality objec- tives offers additional perspective on the role of financial incentives focused on the work commute. Implemented under the regional Clean Air Campaign and named "Cash for Commuters" (CFC), it was an incentive program that rewarded SOV commuters who agreed to switch to a commute alternative for a specified period of time. Eligible commuting alternatives included carpooling, transit, cycling, walking, or teleworking. Commuters who participated in the program could earn up to $180 in cash over a 90-day period at the rate of $3 per day that an alternative was used. Participants were required to live in the 13-county Atlanta region, register for the program, and affirm that they had not used any of the alternative commute modes more than 5 times during the preceding 90-day period. To receive compensation, participants were required to submit a travel log at the end of the enrollment period, which had to be verified and signed by the commuter's employer supervisor. Three separate program waves were conducted, during the 2002, 2003, and 2004 smog seasons, involving a total of 5,460 participating commuters. 19-58

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An evaluation survey was conducted to track the behavior of the Wave 1 participants and gauge both initial impact on behavior and long-term effect on alternative mode-use rates. Prior to pro- gram enrollment, commuters in the Wave 1 group drove alone on 85 percent of their commute trips. During the period that they were receiving a CFC incentive, driving alone dropped to 14 per- cent of all trips, thus 86 percent of trips were made by an alternative. In 3 to 6 months after complet- ing the CFC program, the proportion of drive-alone trips increased to 38 percent, by 9 to 12 months it reached 47 percent, and by 18 to 21 months after the program the drive-alone rate was at 53 per- cent. It appears that the financial incentive not only had a significant impact on initial disposition to use alternatives, but also led to a fairly high rate of alternatives use even 18 to 21 months past the time of the incentive offering (Center for Transportation and the Environment, 2004). Financial Incentives in General. One attempt to sort out the relative importance of various eco- nomic incentives in employer TDM programs was made in the study of TDM at medium-sized employers that has contributed 38 employer case study examples to the 82-program sample. As illustrated in Figure 19-1, the researchers used linear regression analysis to estimate the relation- ship between the application of economic incentives and SOV rates (SOV commute mode shares). For the analysis, only economic incentives that apply to all employees were used to calculate a net HOV incentive. Parking charges and alternate mode travel allowances were counted as additive HOV incentives, whereas a general travel allowance was assumed to decrease the HOV incentive of a parking charge. In other words, if an employer had both a parking charge and a general travel allowance, the allowance is subtracted from the parking charge to get the net HOV incentive value. The resultant regression equation (sample size of 38, r2 = 0.54) implies a reduction in SOV commut- ing rate of 0.27 percent for every $1 of monthly incentive (Rutherford et al., 1994). 19-59

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Figure 19-1 Effect of economic incentives on SOV rates Source: Rutherford et al. (1994). In-Kind Incentives. In lieu of cash, employers have attempted to encourage use of transporta- tion alternatives through in-kind incentives with a tangible monetary value. The most popular among these methods are periodic raffles and time off with pay. Table 19-12 shows that 12 of the 56 employers in the 82-program sample who provided incentives offered some form of in-kind incentive. Allergan, Arlington Heights, the City of Simi Valley, Gotcha Sportswear, and Heller Financial all offered time off with pay for alternative mode use. Allergan, Chubb Insurance, the City of Pleasanton, IT Corporation, and Varian had raffles for alternative mode users, offering a chance at major cash or other prizes. Other interesting approaches include the Puget Sound Blood Center, which offered one day of free parking to qualifying alternate mode users; Ventura County and State Farm Insurance, who paid employees for not driving (similar to parking cash-out); and US West in Bellevue, which offered equipment rebates for bike commuters. Unfortunately, it is difficult from the available data to quantify the effectiveness of these strategies on travel behavior, since in almost all cases they are grouped with one or more other strategies that would appear to have at least as great an impact as the in-kind measure. Only Ventura County, with a 13.3 percent VTR, and Gotcha Sportswear, with a 34.1 percent VTR, relied exclusively on their respective in-kind incentive for their TDM program. 19-60