Several years will pass before the City can collect tolls from users of the Don Valley Parkway and Gardiner Expressway; that’s assuming the province even gives the City permission to do so. Unless the City taps into other revenue sources in interim, that could mean several more years of budget cuts, like the 2.6% across-the-board cuts planned for 2017.
Currently, residents can purchase permits to park on residential streets when they do not have access to on-site parking where they live. While prices vary, more than 90% of the permits are sold for $15 per month. If the City increased the prices to something closer to the value of the goods and services “parking” actually represents, it could be an important source of revenue. And, unlike road tolls, the City could access the revenues quickly because neither new infrastructure nor provincial permission would be needed.
In August, condo experts Urbanation reported that the average price of a new condo in the City of Toronto was about $7,100 per square metre. An on-street parking spot is approximately 13.75 square metres, so a person would have to purchase a residential parking permit for more than 500 years at the current price before they’d actually “bought” their spot.
Of course, condos and parking spots are not perfect equivalents, but it’s important to remember that a parking spot is not just a rectangle of asphalt. It is also the street lights overhead and the storm sewers underneath. It is snow plowing in winter, street sweeping in summer and parking enforcement year-round. It is a bundle of goods and services that costs the City a lot of money to provide.
In fact, according to the Victoria Transportation Policy Institute, the annualized costs of constructing and maintaining an on-street parking spot are about $1,341. Even then, that is in an area where land costs $1,200,000 per acre, whereas land costs several times more than that on a typical residential street in the west end, so the annualized costs of providing an on-street parking spot there are likely much more than $1,341. Yet the overwhelming majority of residential parking permit holders in Toronto currently pay less than $200 per year.
All residents benefit from street lighting, storm sewers, snow plowing and street sweeping, of course. That is why all residents pay property taxes to support these things, and why it would be unfair to expect residential parking permit fees to cover all of the related costs. But it is primarily motor vehicle owners that benefit from the parking spot itself because you can’t purchase a permit to store any other kind of private property on it.
If the City increased the price for permits to park on residential streets, it could have an impact on how people get around. If the price was increased to $141.50 per month, say, which is the current price of a Metropass, the appeal of transit, cycling, walking and ride-sharing would increase. Some residents might jettison their cars altogether and rely on taxis, Uber, AutoShare, Car to Go, Zip Car and rental agencies for the occasional trip the other modes can’t serve well. Society would benefit from reduced traffic congestion, reduced emissions and noise, and increased physical activity…
Those residents who really need to have a personal automobile, but are unwilling to pay a higher price for an on-street parking permit, could move to a part of the city where driveways are common and garages are big. As they move outward, they might be replaced by people who don’t own cars, perhaps even by people with low incomes who would benefit from living downtown where distances are shorter and transit, cycling and walking are more viable options.
Current permit holders would not be able to avoid increased fees by parking in their garages or parking pads instead of on the streets. “There are people who use their garages for storage,” admits Vince Loffredi, Supervisor of the City’s Residential Parking Permit Program, “But there aren’t that many because most people prefer to park on their own property rather than on the street.” They would park on-site if they could, which is why most would continue to pay the fees even if they were increased.
Fees from residential parking permits would be no substitute for road tolls, but they could be an important part of a holistic solution to the City’s financial challenges. If the City increased the prices, the program would bring in many times more than the $13.5 million it does at present, money that could be used to expand transit, improve social housing and address other pressing needs instead of cutting back.
All the City has to do is raise the prices.
Written in December 2016.