Downtown Parking Investment Policy

CCRA November 15, 2018

Rick Williams, Rick Williams Consulting

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Presentation Overview

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• Reason for Policy Discussion

• Recap of Existing Parking Program Goals and Current Investment Policy

• Costs of Parking and Investment Strategy Spectrum

• Three Options for City Participation

• Feedback from PAC, PC, and CCRA

Why Does Policy Need to be Revisited?

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• Growing concerns regarding availability of parking, particularly employee parking

• Pressure on City to respond to dwindling supply in order to keep downtown on positive economic footing

• Since recession, City has not invested in new parking facilities but previously participated in several structures

• As opportunities to participate in parking structures arise, what should City’s stance be?

Goals for Downtown Parking Program

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Create a healthy parking ecosystem by:

• Encouraging a vital mix of high-density urban land uses

• Increasing user awareness: right car in the right stall

• Promoting a greater percentage of trips by alternative modes

• Ensuring sustained financial stability

Current Parking Investment Policy (new supply)

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• Focuses public parking investments on patron (visitor) parking

• Discourages City role in investing public funds to provide employee or resident parking

• Employee and residential parking is the responsibility of the private sector

• Pay as-you go (low debt risk); financially sustainable

Cost and Funding of New Supply

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• Estimated @ $45K per stall (5%/20years)

• Requires multiple funding sources

• Currently very difficult in Vancouver market (@ about $100 per stall/per mo./gross)

• General fund is a backstop if City owns

Fees/Charges

Land Divestment Funds

Fees in Lieu/LID Parking Tax

Bonds/Grant General Fund

Cost = $300-400/

stall per month

Other Cities: Parking Investment Spectrum • Most prioritize building public parking for visitors, not employees/residents • Some are not actively engaged in building parking

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Less Engaged

More Engaged

1. Private Sector Approach: City Maintain Existing Assets as Visitor Parking

2. Partner Approach: Public Investment in Visitor Parking Only (non ownership position)

3. Public “All-in” Approach: Proactive Public Investment in Parking Facilities that serve all types of users

Three Main Policy Options for Investment in Parking

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Investment Strategy Options

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No Role in New Parking

City Leads

(all users)

Current Vancouver Policy

Investment Strategy • No new investments in Off-Street Supply

Implications for existing assets • Divest of all non-visitor off-street facilities over time and as is

advantageous to City and budget • Transition focus to maximizing on-street system performance.

Code implications • Eliminate minimum parking requirements / eliminate accessory

designations for parking.

Option 1: Maintain Existing Assets as Visitor Parking

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Funding sources • None needed for capital projects. All surpluses to existing debt

burden. • Establish a capital account for any properties divested.

Risk Level

• Low

Option 1: Maintain Existing Assets as Visitor Parking

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Option 1 Private Sector Approach: Pros & Cons

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Pros Cons

• Clear message that market will take care of parking need

• Elimination of parking minimums (simplifies code) and promotes shared use

• Use existing funds and potential divestments of property to reduce current general fund debt burden

• Existing assets transition to higher mix of visitor parking as demand grows

• No investment risk or assumption of new financial burden

• Parking garage development is still not financially feasible in Vancouver market

• Relies on the private sector to build more parking – not financially viable for private sector either

• May not address current parking issues for quite some time, resulting in potential lack of new investment

Option 2: Invest only in Visitor Parking (Partner)

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Investment Strategy • Strategically invest in private parking developments to ensure

visitor access as opportunities present themselves. • Funding tied to operating agreement for visitor access

management (no ownership position). Implications for existing assets • Phased transition of existing off-street supply to higher mix of

visitor use. • Evaluate divesting of existing off-street facilities with little visitor

demand potential.

Option 2: Invest only in Visitor Parking (Partner)

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Code implications • Eliminate minimum parking requirements / eliminate accessory

designations for parking (Same as Option 1) Funding sources • Parking fund, general fund, funds from property divestment, on-

street surpluses Risk Level • Low to Moderate (all risk to private owner / enforcement of

development agreement)

Option 2: Partner Approach: Pros & Cons

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Pros Cons

• Elimination of parking minimums and promotion of shared use

• Buys down cost of parking in new developments and ensures growth in visitor parking capacity

• City may use public property (land) as contribution to project in exchange for visitor parking

• All financial risk assumed by private sector

• Uses a “full sign never goes up” approach to development agreements

• May still not provide enough “discount” for new garages to be viable Enforcement of operating agreements is required

• Requires on-going public/private operating partnership and marketing/communications coordination

• Current demand for parking is more for employee, less so visitor; however, could transition to visitor parking over time

Option 3: All in – Lead/Invest in Multi-use Garages

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Investment Strategy • Invest in strategically located garage(s) serving multiple parking

users. • Private developers have option not to build parking in return for

access entitlements into City facility(ies). Implications for existing assets

• Evaluate divesting of existing off-street facilities that do not contribute to consolidating supplies.

• Eliminate on-street employee permit program to force demand to new facility(ies).

Option 3: All in – Lead/Invest in Multi-use Garages

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Code implications • Current minimum requirements become optional entitlements

purchased through discounted fee-in-lieu Funding sources

• Fees-in-lieu, LID on existing buildings, Parking fund, general fund, funds from property divestment, new tax revenue

Risk Level • High (all risk to City as owner); likely would have to subsidize

payment of debt service for new structured parking from other sources

Option 3 All-In Approach: Pros & Cons

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Pros Cons

• Lowers cost of new development. • City takes leadership role, maintains

more control of overall parking system • Inspires confidence to private sector,

potentially increasing private investment

• High financial risk / general fund is ultimately responsible

• Need to assemble multiple funding sources; highly complicated

• Sites must be available / possible need to front-end facility ahead of “entitlements”

• Entitlements for guaranteed parking must be managed in perpetuity

• Private sector may not agree to fees-in-lieu (even if discounted)

Discussion Questions

Lot 16

• What should City’s role be in ensuring ample parking for all users? For visitors?

• What should the private sector’s role be in providing parking to visitors, tenants and residents?

• Which option fits best given the need for employee parking and associated risks?

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Next Steps

Lot 16

• Following feedback from Council, staff plans to draft a resolution to formalize Council’s policy regarding investment in public parking

• Tentative Council date for consideration of a resolution would be December 17, 2018

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Questions and Discussion

Chad Eiken, Community and Economic Development Director, chad.eiken@cityofvancouver.us

Rick Williams, Rick Williams Consulting