Should We Subsidize Parking for Low-Income Households?



By Dom Nozzi

Subsidizing parking for low-income people is a mistake, in my opinion.



There is no easy way for a city to subsidize only low-income motorist parking. All motorists will be able to take advantage of this detrimental, market-distorting welfare. Not just the low-income.


As a result, the city would be subsidizing and therefore artificially inflating the number of people who travel and park by car. Without such a  subsidy, those who have a choice would be given a financial incentive to walk, bicycle, carpool or use transit. In effect, then, the parking subsidy promotes an increase in Single Occupancy Vehicle (SOV) travel. In a compact, walkable downtown, when parking is properly priced to reflect actual costs, travelers are given a market signal to engage in non-SOV travel.


Subsidized downtown parking is toxic for the long-term health of a downtown, because the suburbs will always out-compete downtown when it comes to motorist convenience, and because “happy cars” downtown degrade the walkable quality of life in downtown—which the downtown needs to be able to leverage.


In addition, given skyrocketing gas costs (which we will experience for the foreseeable future), why would a city be promoting more auto dependence by subsidizing it? Shouldn’t a city be promoting more sustainable, affordable forms of transportation?


Similarly, auto transportation is an enormous and growing part of the low-income household budget (typically outweighing housing cost savings that are often found for housing in the suburbs). One hundred years ago, the average household spent about two percent of its budget on transportation. Today, the average household spends 22 percent of its budget on travel, and this percentage is growing. If a city is truly interested in helping low-income households, promoting auto travel by subsidizing parking is the last thing it should do.


Cities sincerely interested in helping low-income households should know that a much more sustainable and affordable strategy is to subsidize transit-friendly or walkable downtown housing. Subsidized parking simply perpetuates an unaffordable, unsustainable household expense.


This is not a call for low-income houses to get rid of all of its cars, necessarily. It is simply a recommendation that such households use their car(s) less often, or drive alone less often, or own less cars (one instead of two, or two instead of three). 


True affordability, in the 21st Century, comes from strategies that reduce the need for car travel for low-income households, because it is unaffordable for a low-income household to spend so much of its budget on travel.


Visit my urban design website read more about what I have to say on those topics. You can also schedule me to give a speech in your community about transportation and congestion, land use development and sprawl, and improving quality of life.


Or email me at: dom[AT]

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