3 Municipal Parking Strategies to Keep Communities Running Safely and Aid COVID-19 Recovery
Updated: Jul 30, 2020
Data-driven parking management strategies to curb expenses and kickstart recovery. See how municipalities have partnered with Smarking to navigate through the COVID-era.
While COVID-19 has caused massive disruption across many industries such as restaurants, events, hospitality, airline & travel - parking underlies them all. With a 90%+ decrease of parking demand immediately following the shelter-in-place order, it’s one of the hardest hit industries in the U.S.
For cities, parking is the foundation of municipal economic activity and is a critical resource for employees, first responders, parents, senior citizens, and more. Parking related revenue contributes up to 30% of a city’s overall budget and can fund various community initiatives.
However, it’s largely overlooked due to the misconception that parking revenue is static. But with the right strategies in place, parking can be a dynamic tool to curb expenses and recover revenue loss. For cities, it’s more than revenue- paid parking is needed to manage traffic, reduce congestion, and increase customer turnover for nearby businesses.
1 - Reinstate Paid Parking to Keep the City Funded and Safely Running
For cities, paid parking can be tricky during an economic downturn. While parking revenue plays a key role in funding various city programs, it’s a balancing act to manage revenue needs to keep the city running and the community’s perception of the city.
“Providing ‘free parking’, as Dr. Shoup has taught us, is not really free. You still need to put the lights on, have to make sure that the public restrooms work, provide your ambassadors, your machines, cleanliness, etc. And there’s an induced cost. The last thing I want to do is offer free parking with no lights on and then discover that service workers are now exposed to dangers we hadn’t anticipated. We need to let people know we can be flexible, but it’s not free.” - Henry Servin, Parking Manager at the City of Santa Monica, CA
In the City of Santa Rosa, city leaders halted paid parking in April due to the COVID-19 shutdown. Gradually, unhoused residents began to camp out in surface lots, employees monopolized prime on-street parking, congestion in the downtown core was growing, and revenue loss was significant. The City of Santa Rosa needed to prepare to reinstate paid parking to manage these issues and help the community. To do this, the city first needed to understand the impact of rate changes on revenue and parkers’ behavior.
The city slowly started to re-open in early May but there were still many shelter-in-place restrictions. This caused hesitation that paid parking would cause pushback for business districts that were focused on regaining customers. But by June 8th, their real-time data feed showed that occupancy was back up to 85% in their core district- providing a strong indicator that it was time to reinstate paid parking and now needed to determine the appropriate rates.
Kim Nadeau, Parking Division Manager of the City of Santa Rosa partnered with Jannette Choi, Customer Success Manager at Smarking, to project demand and revenue with new rates. Given the unprecedented nature of COVID-19, historical data alone isn’t sufficient for projections. With Smarking’s Business Intelligence (BI) software, Jannette generated a revenue forecast model using the city's historical parking data and combined it with her own unique revenue modeling based on various recovery scenarios.
The data-driven revenue projections for various recovery scenarios serve as a baseline to decide on the final revenue budget goal with the City Council. Kim presented the reforecasted revenue to the City Council, and they approved resumption of paid parking effective July 2020.
By leading with a data-backed analysis that assesses the viability and effects of rate and operational changes to Council, the city passed the policy. This will prevent further revenue loss, help to improve access to prime parking spaces, and support the downtown economy.
2 - Restructure Parking Rates to Manage Congestion and Enable Accessibility
Parking rates are a powerful tool to control demand. When demand is high, rates can increase and capture the revenue opportunity while also controlling occupancy levels. When demand is low, rates can decrease at a more competitive level to create additional demand, be more accessible in designated areas, and help reduce and manage congestion.
One city on the West Coast was looking to restructure the rates at three of their garages and needed to determine what the new rates should be.
Using the city’s historical data, the Smarking team was able to analyze revenue from 2017-2019. The transaction-level data allowed the team to quickly generate granular reports that showed the revenue change per year given transactions per price tier and duration.
With this data, the city was able to perform an analysis and easily segment split the data as needed and avoided manual data aggregation- saving hours of time. Given the capacity limits at each garage, not only was it necessary to restructure the rates, but an increase was also needed in order to control occupancy levels and encourage turnover for nearby businesses.
This was evident through the longer parking durations at the lower rates and the high peak daily occupancy patterns in the past few months. The city now has the analyses prepared to share with Council and determine the rate changes for FY 2020.
3 - Reforecast Revenue and Budget to Proactively Manage Recovery
Like many cities, the City of Portsmouth was faced with the challenge of reforecasting revenue and the city’s parking budget in a post COVID-19 world. Given the uncertainty with shelter-in-place restrictions, it’s an extremely difficult task.
Benjamin Fletcher, Director of Parking partnered with Smarking to create a dynamic revenue model that accommodates for various recovery scenarios. Smarking started by aggregating the city’s historical data through their BI dashboard and analyzed the monthly variance between the budgeted and actual revenue between January and April 2020. Using this variance, Smarking then assumed a monthly percentage recovery tier for each of the analyzed scenarios: worst case, baseline, and best case scenario - each with its own week-over-week growth assumption.
This gives the City of Portsmouth the ability to readjust as conditions change. With this dynamic model, Ben is able to enter the actual revenue numbers against the projections and have an ongoing, reliable revenue forecast.
“Smarking helped me deliver what many called a ‘smash performance’ for my budget presentation last night in front of City Council” - Benjamin Fletcher, Director of Parking at City of Portsmouth
Access to real-time, centralized data is the first step in extracting key insights and enabling a smart city strategy. Without this foundation in place, data can be difficult and time-consuming to collect, expensive to store, and complicated to analyze. A data-backed recommendation for parking changes can simplify communication among city stakeholders, strengthen the policy, and accelerate the approval process.
Smarking's professional services are provided to clients at no additional cost. Smarking’s Business Intelligence software includes end-to-end service to ensure that municipalities meet each of their unique goals. To support cities COVID-recovery, Smarking is offering their Business Intelligence solution free for 90-days. Try it out with no risk or commitment, valid for a limited time.
Urban Mobility Coalition: Parking and Mobility Leaders Rally for Municipalities to Receive Federal Support
A pledge to seek $30B federal support earmarked specifically for municipal governments across the nation, in order to maintain critical services for communities and help the economy recover from COVID-19 impact.
As we are confronted by the unprecedented COVID-19 pandemic, municipalities across the nation have been experiencing significant revenue losses, facing significant challenges in retaining first responders while we need them the most and keeping the communities running for citizens.
A large portion (often up to 30%+) of the city's revenue is dependent on parking. With real-time parking data from 2,000+ parking facilities (both on-st and off-st) across North America, Smarking saw 90%+ revenue loss since the COVID-19 pandemic outbreak.
40+ cities have endorsed the open letter to congressional and legislative leaders. Support your city by joining the initiative.