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Subsidized Parking is Not an Environmental Service

By Matthew Yglesias on September 16, 2010 at 8:34 am

"Subsidized Parking is Not an Environmental Service"

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Rebecca Cooper writes about a parking garage in Arlington County that wants more revenue and believes it can increase revenue by increasing rates. But there’s a catch! The garage is owned by the county:

The existing rates do not generate sufficient revenues to complete capital repairs and meet debt obligations over the next six to eight years,” she says.

The hourly rate has not been increased since 1994, and the monthly rate has not changed since 1996, according to Patricia Bush, Arlington’s transportation operations manager.

The transportation division will have to receive approval for the increases from the county board, but also from Macy’s Department Store owner Federated Department Stores, which owns the land underneath the garage. The owners of the mall and the attached office buildings will also have to sign off on the rate increases.

This raises the question of why so many municipalities in the United States find themselves owning parking garages. If the idea is to maximize revenue, then you’ll swiftly find that public agencies are not very good at maximizing revenue. Besides which, the public sector has the ability to obtain revenue by taxing parking garages if it wants to fund itself by raising the price of parking to above-market rates. The other possibility is that municipalities are trying to subsidize the cost of parking. In particular, the garage in question appears to be owned by the county’s Department of Environmental Services, suggesting that Arlington County believes subsidized parking is an environmental service.

Parking garages are not, in fact, environmental services. Cheaper parking encourages additional driving, which both directly increased atmospheric pollution and also encourages large homes and low-density residential patterns that indirectly increase pollution because they’re less efficient to heat. Using public funds to subsidize parking transfers resources from poor to rich, while harming the environment. Reasonable people can disagree as to whether it makes sense for public agencies to specifically discourage parking through taxes, but trying to create cheaper or more plentiful parking than what the market will bear is folly.

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