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City Still Wants to Privatize Parking Meters, But Not Pricing or Enforcement

3:51 PM EDT on May 14, 2012

New York City is still interested in contracting out the operations of its roughly 82,000 metered parking spaces, according to a report in today's Wall Street Journal. A prime motivation, it appears, is the belief that a private company could more quickly roll out high-tech additions to the city's parking system, such as sensors that provide real-time parking data. In the next few weeks, City Hall will put out a request for qualifications to put together a short list of potential private partners.

The city won't be privatizing two of the most important components of parking policy with the biggest impact on transportation, however. Both the ability to set the price of a metered space and to enforce parking violations, the Wall Street Journal reported, will remain in the hands of the public sector.

The push to privatize parking meter operations stems from a broader interest in privatization under former Deputy Mayor Stephen Goldsmith. An RFP released last February asked banks for their best ideas on what city assets and operations could be privatized, with parking specifically identified as an area of interest.

To the extent that privatizing meter operations is just an administrative decision -- can a private company collect coins from and maintain parking meters more efficiently than public employees? -- it's unlikely to significantly affect the health of the city's transportation system. It's still reassuring that Deputy Mayor Robert Steel told the Journal that New York City had learned from the Chicago parking meter debacle and isn't looking to use privatization as a one-shot injection of revenue.

But if the city ultimately uses outsourcing as an opportunity to bring New York's on-street parking into the 21st century, the effects could be far-reaching. Real-time parking sensors, one technology mentioned in the article, form the underpinnings of San Francisco's innovative SFPark system, which uses that data to price on-street parking based on demand. New York City installed its own sensors as a pilot program over the winter, but doesn't yet have a plan for widespread deployment. Pay-by-phone technology, which saves drivers the walk and worry of feeding the meter, has proven wildly popular where implemented.

According to the Journal, New York City won’t be giving up two of the most important parking policy levers: meter rates and enforcement. Given the current state of curbside management, retaining the ability to set meter rates is a mixed blessing.

To be sure, setting the price and use of curbside space is an essentially public function. A private company would set prices to maximize revenue, but a public authority might have different goals, depending on local priorities. A city might have good reason to favor loading over parking, or local long-term parkers or visiting short-term parkers.

At the same time, New York City's on-street parking is wildly under-priced, when it is priced at all. On a typical commercial street outside Manhattan, the price for parking spot is fixed at $1.00 per hour. Where the city has introduced better calibrated parking policies, the streets function more efficiently.

In Park Slope, for example, doubling the price of a meter during peak hours allowed more total cars to park on the neighborhood's commercial streets while simultaneously decreasing overall traffic. Allowing more people to reach an area by car while decreasing congestion is a rare win-win.

So while private incentives and the public good aren't perfectly aligned when it comes to parking, in New York City they're largely cutting in the same direction. Allowing the private sector to set meter prices might be the best possible way to get to the right price in a city where politicians fight tooth and nail to keep parking cheap.

The best-case scenario would be for the city to use the technology upgrades theoretically provided by a private parking contractor to set smarter, higher prices on its own. If the city or its contractor use new technology to make parking more convenient for drivers but don't pair it with other reforms, it would be a huge missed opportunity.

Outsourcing enforcement might be an even more controversial move, but one with enormous promise. Right now, New York City's parking enforcement is marred by politically driven, unequal treatment. Anyone with a parking placard, whether real or fake, can park where they like with impunity. The police allow Sunday church-goers to double-park for entire blocks of major thoroughfares like 125th Street or to block bike lanes on handshake deals. And of course, the police themselves disregard any and all parking regulations near their own precinct headquarters. Putting enforcement in private hands could eliminate this kind of political privilege in parking.

In Europe, where forward-thinking parking policy is a major component of sustainable urban planning, private parking enforcement is not uncommon, according to the Institute for Transportation and Development Policy. In Stockholm, for example, two private security companies get paid based on how well they enforce the regulations. To renew its contract with the city, one firm was required to boost compliance from 59 percent of cars parked legally to 75 percent within two years.

Any potential parking privatization is still a ways away and the details have yet to be negotiated. But the Wall Street Journal article certainly gives the sense that the city could be going after a big change to the way parking meters work in New York. It’s a rare chance to administer some medicine to the parking system by putting in place necessary but unpopular changes to pricing and enforcement, while sweetening the deal with high-tech goodies for drivers. It looks like we'll find out whether the Bloomberg administration seizes that opportunity in the coming weeks and months.

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