Green P rates just went up again, but they're not as expensive as you think

Another year, another price hike of the city's Green P parking lots.

It's likely not what drivers who feel Toronto's parking rates are already expensive want to hear, but are the prices really that high compared to other cities?

The City of Toronto's Green P lots there are 204 of these lots, with some 38,000 spaces are raising half-hourly rates by25 cents and50 cents as of Monday, although residential parking rates and on-street parking is set to remain at the same price until 2020.

Ian Maher, ofthe Toronto Parking Authority (TPA), says most Torontoniansprefer to park on-street, and with prices already peaking at $5 right now, next year's price hikes could be too much for some Torontonians.

"I think they're very fair," Maher told CBC Toronto, defendingthe on-street rates.

Stacking Toronto's on-street prices up against those of other major cities shows that's true, to a degree.

The comparative analysis shows that Toronto wades in the lower range of the spectrum when it comes to on-street parking rates. Other major cities like San Francisco and Los Angeles have relatively higher parking prices, and for good reason.

DonaldShoup, author ofThe High Cost of Free Parking,says that the price hikes in Toronto aren't frequent enough.

"For every big city, I think they ought to charge different prices at different times of day on different blocks,"Shoup told CBC Toronto.

He prefers a performance parking-approach; a system implemented in San Franciscoand Los Angeles (L.A.)that adjusts the price of a parking space depending on the level of demand at a particular time of day.

Maher saysthat Toronto follows a similar system but the monitoring and changing of the prices isn't as frequent as in other cities with on-street parking prices changed every threeyears and off-street prices hiked every year.

But what does thisfrequency have to do with parking rate hikes? To answer this question, it is important to understand why price hikes happen in the first place.

'It's all about the formula'

TPA considers threethings whenhiking Green P rates:

• Overall turnover for businesses.

• Parking space availability for commuters.

• Revenue generated by TPA.

Maher saysone of theobjectives of the parking program is to bring in as many customers as possible forbusinesses, thereby increasing sales. However,Shoup thinks that it's all about "the formula" something concrete.

For instance, in San Francisco, a day is split into threetime periods andparking spaceoccupancyis observed for each time period.

If average occupancy is above 80 per cent, the prices are hiked by 25 cents an hour. If it is60 per centor below, the prices dip 25 cents per hour.

This is the formula which has proven effective in keeping prices controlled. Shoup believes that every city's parking rate should be regulated by a formula and thatthe objective should be to create one that works well for that city.

"Parking demand is almost predictable, like tides,"saysShoup.

Parking demand is almost predictable

He further compares periods of high and low demands with high tide and low tide respectively, stating that prices are high during periods of high demand and low during periods of low demand.

For instance, those big Californian cities,the parking spaceoccupancy levels remain the sameall day long with the prices varyingaccording to the rise or fall in demand during a given time of day.

This meanslow-occupancy areas will have lower demand and hence the prices will be low. Once the demand starts to increase, the prices are hiked up. This hike will force drivers to look for alternative spots with lower rates, thereby maintaining occupancy level in the area.

Parking demand is almost predictable, like tides- Donald Shoup

However, in Toronto,the occupancy levels are constantly changing due to fixed parking prices in each area. This leads to overcrowding in the areas where prices are lower.

But the question remains who benefits from theprice hikes?

Revenue generation for cityversusCommuter benefits

The TPA states that the revenue collectedis used to pay any debts, fund facility expansion programs and for the city's use.Shoupbelieves that the commuters benefit from it too.

"What every driver wants is to see that when you arrive, there's a parking space waiting for you because if there isn't, people have to drive around looking for one,"Shouptold CBC.

He believes that this leadsto traffic congestion, carbon emissions and air pollution which cities can't fixby subsidizing cars or building more lots.

Hence, if on-street parking prices are hiked, there'll be lesser congestion at the curb with more people parking off-street. It's a simple solution and the commuters eventually stand to benefit, he says.

Alternatively, changingthe prices more frequentlycan actually help lower parking prices, depending on the demand in a particular area, at a particular time. Again, commuters stand to benefit.

At the end of the day, parking is a "personal issue, not a policy question,"according toShoup.

So while revenue generation and businessturnovers may be the superficial goal, there is anunderlying benefit for commuters as well. Looking at the bigger picture, afew extra centsseemlike a small price to pay.