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Table 44. Comparison of demand elasticity by zone in Chicago, 20082009.
Zone 6 5 4 3 2 1
Elasticity 0.7 0.9 0.95 0.9 0.95 0.98
Source: Chicago Metered Parking System Concession Agreement: An Analysis of the Long-Term Leasing of the
Chicago Parking Meter System, City of Chicago, 2008
Table 45. Enforcement costs and revenues for the Westminster parking system.
Year 2005/06 2006/07 2007/08 2008/09
Enforcement Costs 0.9% 2.8% 13.0% -5.8%
Revenues -9.4% 13.5% 14.1% -3.5%
Source: Annual Parking Report 2009, Westminster City Council
5.4.5 Parking Fees Cost Impact
Parking Rates In Chapter 2, three parking systems were studied with only
one of these systems--Westminster--offering sufficient finan-
Since the 1970s, there has been a great deal of analysis
cial data to allow further analysis. In Chapter 4, the financial
regarding the demand elasticities of parking rates. A study
performance of the Westminster parking system resulted in
completed in the mid-1970s estimated a demand elasticity of
enforcement costs of approximately 74% of total costs. In com-
-0.3 for parking garages in the San Francisco area (Kulash,
parison, administrative and collection costs constituted 11%
1974). More recently, a 1998 study conducted in the Portland
and 15% of total costs, respectively.
area estimated that the demand elasticity for parking in urban
Based on the review of this data, there are some indications
Portland was -0.58 for SOVs and -0.43 for carpools. Corre-
sponding values in suburban Portland were estimated at -0.46 that an increase in enforcement activities can potentially lead to
for SOVs and -0.44 for carpools (Dueker, Strathman, and an increase in revenues, up to a certain point. This is evidenced
Bianco, 1998). Furthermore, demand elasticity for parking in the analysis of enforcement costs and revenues for the West-
facilities in Chicago was estimated to be -1.2 (Feeney, 1989). minster parking system from FY 2005/06 to FY 2008/09, which
This broad range of demand elasticity values reflects the rela- are summarized in Table 45. During FY 2005/06, enforcement
tive availability of lower-priced or free alternatives, the ability costs increased by approximately 1%, while revenues increased
to shift parking duration, the ability to shift transportation by nearly 14% for the following year. This analysis assumes a
mode, income, and other factors. lag of up to a year with respect to revenue generation as a result
A more recent study was undertaken by the City of Chicago of strengthened enforcement activities and a potential change
that analyzed the demand elasticity of the privatized Chicago in motorist behavior. Enforcement costs also increased by
system. These results, which are summarized in Table 44, indi- 3% in FY 2006/07, while revenues increased by 14% during FY
cated that demand was relatively elastic, with values ranging 2007/08.
from 0.7 to 0.98 depending on the parking zone. However, a different effect was evidenced in FY 2007/08,
when enforcement costs increased by 13%, followed by a 6%
decrease during FY 2008/09. These results indicate that other
Scale
factors might affect revenue generation. In particular, the
The concepts underlying scale for parking systems are onset of the most recent economic downturn may have
similar to those for cordon systems, with a larger coverage been a stronger factor on revenue generation in FY 2008/09
area potentially resulting in increased revenue generation. than increased enforcement. Specifically, decreased economic
However, this would need to be counterbalanced with the activity results in fewer work and recreational trips. Again, this
higher capital costs associated with the purchase of addi- analysis was conducted for a single agency over a relatively short
tional parking equipment as well as the incremental costs period of time. Additional data and research would be neces-
for administering customer accounts, payment processing, sary to draw a more precise conclusion between enforcement
and enforcement. costs and the revenue impact on parking systems.
