Urban Form

How we did the Storefront Index

Posted on by Dillon Mahmoudi

We’ve received many questions on how we did the analysis behind our Storefront Index. This post will describe our dataset, our method, and how we created our visualizations. We hope that this will spur future research and new forms of visualizations, similar to the way in which the release of our Lost In Place data led to amazing reinterpretations of the dataset.

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We used a database of businesses from Custom Lists American Business Directory. The Directory contains 2014 records on US businesses, their industry classification, and their address. Our aim was to understand how clusters of these quasi-private storefront spaces contribute to active streetscapes and generated steady flows of people — so we filtered our business dataset based on three criteria: 1) businesses in the largest metro areas; 2) businesses that have storefronts; and 3) lastly, a spatial filter based on clustering.

For the first filter, we simply chose business in the largest metro areas based on the 2013 definitions of CBSA. For the second filter, we selected businesses that fit into one of 44 industry classifications that would typically have customer-serving storefront. These include businesses like grocers, bookstores, and salons. A full list of our categories can be found on page 18 of the report.

Armed with a storefront business dataset, we next sought to find clusters of storefronts. Thus, for each business with a storefront, we needed to know the distance to the next closest storefront. Our first task was to geocode the addresses, turning the address into a latitude and longitude that we could map. (Luckily, we performed this geocoding in ArcMap just before they cut off access to their geocoding API.) We then used the NEAR function in GIS software, allowing us to calculate the distance to the next closest storefront in meters. To apply our filter, we then chose only storefronts that had another storefront within 100 meters, allowing us to identify clusters of destinations that would be easily walkable.

With our three filters applied, we created a set of map images (for the report) and an interactive map. We used a 3-mile buffer around the central business district of our metro areas of interest. For the images, we highlighted these buffers in white, and used only the points of our clustered storefront locations and the US Census Bureau’s Roads shapefile. For the interactive web map, we used a circles to represent the 3-mile buffer, the points of our clustered storefront locations, and the Mapbox library with the Stamen Toner basemap.

Our list of industry classifications (using Standard Industry Classifications) can be found here and GeoJSON shapefiles for each metro area (using FIPS codes for each metro) can be found here.

City Report: Lost in Place

Posted on by Joe Cortright

Here’s a summary of our latest CityReport: Lost in Place: Why the persistence and spread of concentrated poverty–not gentrification–is our biggest urban challenge.

Lost in Place traces the history of high poverty neighborhoods in large US cities, and constructs a new view of the process of neighborhood change.  This article summarizes some of our key findings.  A complete guide to our report, including a PDF of the report narrative, sortable tables of metro area data and links to our neighborhood level maps are available here.

We were drawn to examine this question because of the concerns that are frequently raised suggesting that efforts to promote urban revitalization have the unintended negative consequence of making life worse for the urban poor. The argument is made that improving a neighborhood simply results in one population (wealthier, whiter) moving in and the existing residents (poorer persons of color) moving out, with the result that the poor are worse off than they were had no revitalization occurred. There are some well-known examples of places that are now very high income–like Chelsea in Manhattan–which were once poor neighborhoods.

But the question is seldom asked: How representative are these instances? And how prominently do they figure shaping the overall pattern and prevalence of urban poverty?

The term gentrification itself is fraught with discord. It is widely used and seldom precisely defined. In this study, we’ve set out to shed some light on the question by focusing on a single index of neighborhood well-being: the poverty rate. Despite its flaws, the poverty rate is a good marker of a neighborhood’s relative economic status over time. Moreover, critiques of gentrification flag its harm to the poor, so logically, we should find the most dramatic effects of gentrification in high poverty neighborhoods.

There are very good reasons we ought to be concerned about the plight of those living in high poverty neighborhoods. A growing body of social science research confirms that concentrated poverty magnifies all of the pathologies associated with poverty. Most troubling, new research shows that these effects make a major contribution to the intergenerational transmission of poverty: children growing up in neighborhoods of high poverty have permanently impaired life chances compared to otherwise identical children growing up in neighborhoods with low poverty.

Our data show that while striking when it happens, instances of gentrification of previously high-poverty neighborhoods are quite rare. Only about 5 percent of the poor living in urban high-poverty neighborhoods in 1970 would have found that their neighborhood saw its poverty rate decline to less than the national average four decades later.

Three-quarters of high-poverty neighborhoods were still places of high poverty four decades later. But they were far from stable; on average these chronically-poor neighborhoods lost 40 percent of their population over four decades. High-poverty neighborhoods are not stable or sustainable; they are in a steady process of decay. It’s an illusion to suggest that in the absence of gentrification, a poor neighborhood will remain the same.

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If we’re concerned about the poor and about concentrated poverty, our attention should be riveted to a much larger and more ominous trend: the growth of new neighborhoods of high poverty. Between 1970 and 2010, the number of urban neighborhoods with poverty rates exceeding 30 percent nearly tripled, to 3,100, and the number of poor persons living in these neighborhoods doubled from 2 million to 4 million.

A majority of these newly-poor neighborhoods were places that in 1970 had poverty rates below the national average–places we call “falling stars.” They were arguably middle class 40 years ago, and today are neighborhoods of high poverty.

The sheer scale of the spread of concentrated poverty emphasizes how modest the effect of gentrification has been on the location of the poor. The number of poor living in high-poverty neighborhoods that rebounded since 1970 declined by about 67,000. This is a good maximum estimate of the “displacement” associated with gentrification. Over the same time, the number of poor persons living in newly poor neighborhoods increased by 1,250,000. This suggests that at most, the relocation of the poor attributable to gentrification accounts for perhaps five percent of the increase of population living in concentrated poverty.

We’re coming to understand that place plays a big role in shaping economic opportunity. How we build our cities–and whether we allow concentrated poverty to persist and spread–will have a profound impact on whether future generations will continue to share the American dream.


For more information regarding economic opportunity, economic segregation, and concentrated poverty, go here, and to see the full report including metro-level dashboards and maps, go here.

Ten More you should read about Gentrification, Integration and Concentrated Poverty

Posted on by Joe Cortright

Gentrification and neighborhood changes are hotly contested subjects.  In the past few years some very thoughtful and provocative work has been done that helps shed light on these issues.  Here we offer ten more of the more interesting arguments that have been put forward as a follow up to our previous post, as well as our report on gentrification and poverty.

  1. Myron Orfield and Thomas Luce looked at the racial composition of urban neighborhoods over the past three decades and conclude that contrary to widespread fears of gentrification, the data clearly show that once a neighborhood becomes predominantly non-white it virtually never reverts to predominantly white. Just two census tracts out of the nearly 1,500 that were predominantly non-white in 1980 became predominantly white in the next three decades, and only seven percent of them became diverse.
  2. Next Cities Sandy Smith outlines some of the strategies that cities are pursuing to minimize displacement of populations in those neighborhoods that are experiencing gentrification.
  3. Daniel Hartley’s study for the Cleveland Federal Reserve Bank of gentrifying neighborhoods shows that neighborhood upgrading is associated with economic improvements for existing residents, in the form of higher credit scores than otherwise similar residents living in neighborhoods that don’t experience gentrification.  Hartley studied credit scores in the gentrifying neighborhoods of 55 cities and found the numbers went up for original residents, whether they owned property or rented.
  4. In his new book, The Concentration of Poverty in the New Millenium, Paul Jargowsky presented data on the number of persons living in census tracts with extremely high rates of poverty (40 percent or greater).  His work shows that the biggest increases in concentrated poverty have been in the Midwest and in smaller to medium sized metropolitan areas.
  5. In their 2011 paper for the Brookings Institution, Alan Berube and Elizabeth Kneebone track the number of neighborhoods of extreme poverty (census tracts with poverty rates of 40 percent or higher) using data from the 2005-09 American Community Survey.  While concentrated poverty had eased during the 1990s, their analysis–The Re-Emergence of Concentrated Poverty: Metropolitan Trends in the 2000s–showed that it had increased substantially and especially affected Midwestern metropolitan areas.
  6. For the past several months, the Furman Center at New York University has been sponsoring a “slow debate” on gentrification, neighborhood change and integration.  Entitled “The Dream Revisited: A Discussion on Neighborhood Gentrification” you’ll find a series of point-counterpoint essays by experts in the field including Lance Freeman and Rachel Godsil
  7. Writing this year in a paper prepared for the American Assembly, Todd Swanstrom considers whether the process of gentrification is different in “legacy cities”–older slower growing or declining industrial cities.  Swanstrom argues that gentrification has been studied mostly in “strong market” cities with high and rising real estate prices, and that the nature and impacts of gentrification are far different in places with weaker real estate markets.   
  8. Concerns about the adverse effects of gentrification on rents often prompts local alliances between renters and community groups to oppose new development.  In an article in Dissent, “Fighting Gentrification, but to what end?” Ben Ross challenges whether opposing development actually protects affordability.  Limiting development limits supply, pushing prices–and rents-higher.  As long as the demand for dense, walkable neighborhoods exceeds the supply, lower income households will find it difficult to afford such neighborhoods.  Instead of opposing density, he argues, we ought to be looking for ways to increase it in places where it makes the most sense.
  9. Kendra Bischoff and Sean Reardon trace out the connections between growing income inequality and growing economic segregation in the nation’s metropolitan areas in the Russell Sage report “More Unequal and More Separate: Growth in the Residential Segregation of Families by Income, 1970-2009.”  Their analysis shows that the number of families living in middle income neighborhoods has declined, and that we are increasingly segregated into high income and local income neighborhoods.
  10. In their pathbreaking work studying intergenerational economic mobility, Raj Chetty and his colleagues at Harvard and Berkeley have generated an impressive body of data about the connections between place and economic opportunity.  They look at the chances that children growing up in the poorest families grow up to have higher levels of income and find that one of the correlates of economic mobility is income segregation:  metropolitan areas with areas of concentrated poverty have less economic mobility.

Are suburbs really happier?

Posted on by Joe Cortright

A few months back our friends at CityLab published the results of a survey looking at differences in attitudes about cities and suburbs under the provocative headline, “Overall, Americans in the suburbs are still the happiest.”

Their claim is buttressed with a reported finding that 84 percent of all the respondents in suburbs said that they were “satisfied with their communities”, while only 75 percent of those who reported living in cities felt the same.

While at first glance, this seems to be pretty cut and dried, a closer look at the data suggests that the answer is far less clear.

As with all surveys, it’s worth paying very close attention to the actual question asked, the size of the survey’s margin of error, and the other factors that determine how respondents answer particular questions.

When we consider each of these factors, it actually turns out that it is difficult to make a strong claim that suburban residents are happier than their urban kin.

First, consider the question asked in the State of the City survey.  It isn’t about “happiness”—it’s actually about satisfaction.  This is more akin to a consumer satisfaction.   There’s actually a well-developed happiness literature that asks people about their overall level of happiness. The conventional question is very internally focused, and doesn’t refer to place. The Pew Center has a good introduction to this subject here.   So when we interpret these data, we should think of them not showing whether people are more or less happy than others living elsewhere, but whether they are satisfied or dissatisfied with their communities.

Second, in interpreting survey results, it’s important to consider the sample size and the sampling distribution of error.  The overall survey included 1,656 respondents and the reported margin of error for the survey was plus or minus 3.4 percentage points.  But that margin of error holds only for the entire sample—subgroups of the population (like just the one-third or so of respondents living in cities) are fewer in number and therefore have a larger percentage point margin of error.  That number isn’t reported.  But differences of less than four or five percentage points between sub-groups of the sample are likely to be borderline significant at best.  When differences between sub-groups are small, we shouldn’t make too much out of them.

Third, we know that happiness (or in this case, satisfaction) is correlated with income.  Higher-income people are more likely to say they are happy; lower-income people less likely.  So if suburbs have more higher-income people and cities have more lower-income people, the apparent difference in reported satisfaction could be the product of income, rather than location.  This appears to be the case for the data reported here.

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Like published happiness research, the State of the City survey shows that reported satisfaction is highly correlated with income. Some 88 percent of those with incomes over $75,000 said their community was excellent or good; only 66 percent of those with incomes of less than $30,000 said the same. It’s worth noting here that the impact of income is larger than the impact of location in influencing satisfaction (a 9 percent difference between city and suburb as opposed to a 22 percent difference between high and low-income groups.  These data suggest that the real headline finding of this survey should be “higher income people are more satisfied with the places they live.”  The unsurprising takeaway here is that more income enables you to afford to live in a community that makes you happy. We could get a more direct answer to this question by looking directly at income data.  While the CityLab article didn’t publish the findings on income by city and suburb, we can observe the differential effect of income on satisfaction levels in cities and suburbs by looking at two other variables—education and home ownership—which tend to be correlated with income.If we look just at the college educated, we find that the differences between cities and suburbs shrink by about half:  College-educated urban residents are almost exactly as satisfied as college educated suburban residents (80 percent v. 85 percent).

If we look just at homeowners—who in general have higher incomes than renters—we find that the differences between cities and suburbs almost entirely disappear.  Urban homeowners, for example, are almost exactly as satisfied as suburban homeowners (84 percent v. 87 percent).

Finally, we might want to consider how the race of respondents influences community satisfaction.  When you dig into the data by race and ethnicity, the entire difference in reported levels of satisfaction appears to be the result of the differential racial and ethnic composition of cities and suburbs.  Non-Hispanic whites living in cities were almost exactly as likely to report being satisfied with their communities (84 percent) as non-Hispanic whites living in suburbs (83 percent).

It’s definitely worth looking hard at data on personal happiness and community satisfaction, but in doing so, it’s critical that we take care to understand what the data are—and aren’t telling us.

Metro’s “Why Bother” Climate Change Strategy

Posted on by Joe Cortright

If you’ve hung around enough espresso joints, you’ve probably heard someone order a “tall, non-fat decaf latte.” This is what baristas often call a “why bother?” That would also be a good alternate description for the Metro Climate Smart Communities Plan.

Framed in glowing rhetoric, the plan purports to be a two-decade long region-wide strategy for meeting our responsibility to address this serious global problem. But in reality it sets goals so low that they actually call for reducing the pace at which we’re reducing driving and greenhouse gas emissions.

This weak plan is all the more surprising given the area’s history. The Portland area has long prided itself on being a forward-looking first mover, when it comes to seriously addressing climate change. More than two decades ago the City of Portland became the nation’s first local government to adopt a greenhouse gas reduction plan.

It’s increasingly apparent that climate change is a serious menace. Now, Portland’s elected regional government is working on a new effort to develop what it calls a “climate smart communities plan.”

Transportation is the region’s single largest source of greenhouse gases, so it makes sense to focus on transportation. Metro’s plan sets a number of targets to guide regional transportation planning that in theory might help the region reduce its carbon emissions from transportation over the next two decades. The key performance measure is “vehicle miles traveled,” or VMT– basically a count of how much driving we do in the region. Right now, the average Portland area resident drives about 19 miles per person per day. There are a lot of ways to measure the transportation system–bike mode share, number of bus hours, total number of transit passengers, counts of pedestrians. But if you have to pick one number that tells you how car-dependent and emissions heavy your transportation system is, it’s VMT. And by the rules of thumb prescribed by transportation engineers, VMT levels translate in a very straightforward way into the “need” for more roads capacity for cars. If VMT goes up, they’ll say, you need more roads. If it goes down, you’ll need less.

Over the past decade, Portland has made good progress in reducing VMT. Since 2006–when we drove about 20.1 miles per person per day, we’ve cut driving at an average annual rate of about 1.7 percent per year. Since 1996–a period that includes an era of much cheaper gas prices–driving has fallen about 1 percent per year. But that was all in the past when we were un-enlightened and pretty un-motivated about the threat of climate change. Now that we’re serious–and we’re “smart” about this issue– we’re really going to get aggressive, right? Not so much.

Metro’s plan is that we reduce driving by a grand total of an additional two miles per person per day between now and 2035, or from a current level of 19 miles per person per day to about 17 miles per person per day. That’s right–over the the next two decades metro’s climate smart plan calls for reducing driving at about 0.4% per year–about one-fourth as fast as we have been reducing driving over the past several years without a climate smart plan. In effect, Metro’s very feeble target for VMT reductions means that they are planning for a world where there’s a lot more private car driving–and demand for roads and expensive road projects–than even current, business-as-usual trends suggest.

Rather than reducing driving, this assumption is likely to lead to an investment strategy that enables or encourages more driving that would otherwise occur if we simply assumed that recent trends continue.

To get an idea of just how feeble this planned reduction is, consider the recent travel demand forecast prepared by the Washington State Department of Transportation. They predict that over the next two decades, per capita vehicle miles traveled will decline about 1.1 percent per year. Keep in mind, this isn’t some rabid environmentalist’s stretch goal: it’s the highway department’s prediction of driving trends, without any regard to climate change. (Even this rate of decline is still only about 60% as fast as the region has managed over the past decade).

WSDOT’s baseline prediction (a decline in per capita VMT of 1.1 percent per year) would suggest that the real trend for regional driving would be a decline to 17 miles per day by 2021, and a further decline to 14 miles per person per day by 2035.

Whatever this is, it should be apparent that it’s nothing resembling bold climate leadership; if anything it is technocratic foot-dragging, providing an opaque statistical rationalization for actually slowing the rate of progress we’ve already made as a region in addressing the problem of climate change.

And there’s one more thing the Metro largely plan overlooks. Reducing VMT doesn’t just reduce carbon emissions. It also saves the region’s households money. Lots of money. Cutting VMT by additional one mile per person per day would save the region’s households roughly $250 million per year, every year, in reduced fuel and auto costs. Setting a more aggressive target for VMT reductions would actually be good for the local economy–because it would mean local consumers have more money to spend on things other than cars and gasoline.

My colleagues working in the education field often talk of the “soft bigotry of low expectations”–that we don’t ask much of students from challenged schools, and that as a result, they have little incentive or motivation to dramatically improve their performance. The Portland region has a proud history of being a risk-taking pioneer in the environmental field, with its original goal of reducing greenhouse gases, implementing an urban growth boundary and cleaning up the Willamette. Arguably, this is the time to be bold. If it were serious, Metro could explore setting a goal of reducing driving to twelve or even ten miles per person per day by 2035. It’s likely that the public savings from lower road construction costs and the household savings from less spending on cars and gasoline would add up into billions of additional resources for the local economy–not to mention lower greenhouse gas emissions.

Climate change may be the most profound existential challenge we’ve ever faced, but the proposed Metro plan sets the bar for progress so low as to be meaningless. There’s certainly nothing in this plan that expresses any ambition to do more than is already baked in the cake. In fact, it does a lot less than we’ve managed with no plan, and a lot less that our neighbors to the North predict will happen, even with no further policy intervention. Paradoxically, it may end up being used to plan for higher levels of driving than can reasonably be forecast to occur if we do nothing. There are a lot of phrases that could be used to describe such a plan, but “climate smart” isn’t one of them.

Why bother?

Our Shortage of Cities: Portland Housing Market Edition

Posted on by Joe Cortright

The big idea: housing in desirable city neighborhoods in getting more expensive because the demand for urban living is growing. The solution? Build more great neighborhoods.

To an economist, prices are an important signal about value:  rising prices for an object or class of objects signal increasing value relative to other objects.  In our conventional supply and demand framework, rising prices are often symptomatic of a growing demand or a limited supply:  that consumers now want more of some commodity or product than is currently available in the market.

Trends in housing prices point to some significant shifts in consumer demand, especially in the value that consumers attach to urban, as opposed to suburban, locations.  The rising relative price of housing in cities is a strong indication of the growing demand for urbanity–and its unfortunate short supply.

Case in point:  Portland, Oregon.  Let’s take a quick glance back at housing prices in the Portland area over the past decade (courtesy of Zillow’s comprehensive archive of monthly housing price estimates).  For simplicity, we’ll look at four Portland metro area sub-markets–the central city of Portland (home to a little more than a quarter of the region’s population), and the region’s three principal suburban counties–Clackamas and Washington Counties in Oregon, and Clark County, Washington.  The following table shows single-family home prices for 2005, 2007 (the peak year for the region’s housing market), 2010 (the bottom of the bust) and the data for the latest quarter (3rd Quarter 2014).  To simplify comparison between the city and suburbs, I’ve calculated the un-weighted average price for for the three suburban counties.

In 2005, in the heyday of the housing bubble, the city of Portland’s housing prices were $236,000, on average about $20,000 lower than the three suburban jurisdictions, ranging from $3,000 lower than Clark County, to $30,000 lower than Clackamas County.  According to Zillow’s latest estimates the average Portland single family home is now worth about $309,000. Portland’s prices today are about $20,000 higher than the average of the three suburban counties, and its price level is equal to that of the Clackamas, the priciest suburban county.

Not only have houses in the City of Portland re-couped all the value lost to the collapse of the housing market, they are now worth on average about 6 percent more than they were at the peak of the housing bubble.  Meanwhile, the average suburban home is still about 7 percent below its peak price.

The verdict of this shift in housing markets is unequivocal:  housing in the city is now more valuable, and has appreciated faster than suburban housing.  In less than a decade, the city has reversed geographic polarity of the regional housing market:  the average city house sold at a nine percent discount to the average suburban house in 2005; today the average city house commands a seven percent premium.

There are doubtless many reasons for this shift.  We know that young, well-educated workers are increasingly choosing to live in close-in urban neighborhoods.  Over the past decade, the big increase in gasoline prices has made car-dependent suburban locations more expensive and less attractive than urban living.  My 2008 CEOs for Cities report “Driven to the Brink,” reported some early evidence that housing prices fell most on the suburban fringe, and held up best in urban centers.

The falling price of suburban housing relative to city housing is the most persuasive evidence possible about consumer preferences.  Citing the results of a recent opinion survey, some have claimed that Portland-area consumers allegedly prefer suburban locations to urban ones. But the fact that consumers are not willing to pay as much for suburban housing as they are for urban housing, and that while urban home prices are setting new highs, suburban prices are still well below their peaks, shows that the reverse is actually true:  consumers value urban single family housing more than its suburban alternative.

The rising price of urban housing is a market signal that housing in the city has value to consumers–and that we should be making more of it.  Prices are rising because the demand for city living is rising faster than we’ve expanded the supply of urban housing.  The clear public policy implication of the market data is that city and regional governments should be looking seriously at ways to expand the supply of urban housing.  And expanding supply in the city is especially important to addressing concerns about housing affordability:  unless supply expands, we can reasonably expect the growing demand for urban living to push prices still higher, reducing affordability.

While this commentary focuses on the city of Portland, there are good reasons to believe that the nation is experiencing a significant and growing shortage of cities as well.  As Americans rediscover–and recreate–the attractiveness of urban living, this shortage is likely to grow.  Paying close attention to the signals provided by the housing market is key to understanding the nature of this challenge and implementing appropriate solutions.

Technical Notes:  Data for this analysis were obtained from Zillow.com’s city and county ZHVI-Single Family Residential index.  Values are annual averages of monthly data, rounded to the nearest $1,000.  The suburban average presented here is the unweighted average of the price index values reported for the three suburban counties.  Since these four areas are all part of a single, larger metropolitan economy that shares the same industrial and job base, its pretty straightforward to interpret the change in relative prices among sub-markets as indicative of the relative change in consumer preference for these areas.  Also, because so little new single family housing has been constructed in the past several years, these numbers are not meaningfully skewed by the construction of a large number of new houses in any one jurisdiction.

The four biggest myths about cities – #4: Traffic is getting worse

Posted on by Joe Cortright

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The Myth: Traffic congestion is getting worse

The Reality: Congestion has declined almost everywhere

It’s a common movie trope – a busy commuter rushes out of his downtown office at 5pm, hoping to get only to enter a citywide traffic jam. In reality, traffic congestion across the country has been in steady decline thanks to Americans choosing to drive fewer miles every year and increasingly biking, walking and taking transit for many of their trips—especially in cities.

Using data from GPS devices in millions of vehicles, Inrix tracks highway travel times in the nation’s large metropolitan areas (when they aren’t fear mongering about the costs of congestion). In its past two annual reports, Inrix pointed out that time lost to congestion has fallen dramatically in the United States. In 2011, congestion levels declined 30 percent nationally, and they declined a further 22 percent in 2012. Their travel time index measures the additional time that a typical peak hour trip takes compared to the same trip taken during free-flowing road conditions. A travel time index of 12 means that a trip that takes 20 minutes during free flowing travel conditions takes 12 percent longer—about 22 and a half minutes—during the peak travel period. Traffic congestion, as measured by the travel time index has fallen by about forty percent, from between 11 and 12 in 2010 to about 7 in 2013.

The distance we’re driving has decreased as well. Americans have cut their driving from a peak of 27.5 miles per person per day in 2005, to about 25.5 miles per person per day now.

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Cities are remarkably effective at reducing commute times – the closer you live to work, the less time you spend in the car.

You can learn more about traffic congestion and the dreaded “Carmageddon” in the Questioning Congestion Costs card deck.

Congestion and crime are dropping, kids in cities are safer and healthier than their suburban counterparts, and urban air quality is better than it’s been in decades. The sooner we can shed these outdated myths about city living, the sooner we’ll be on a path to building better places for Americans to live.

Photo courtesy of Neil Kremer on Flickr.

Parking: The Price is Wrong

Posted on by Joe Cortright

One of the great ironies of urban economies is the wide disparity between the price of parking and the price of housing in cities. Almost everyone acknowledges that we face a growing and severe problem of housing affordability, especially in the more desirable urban neighborhoods of the nation’s largest and most prosperous metropolitna areas.  As we’ve frequently pointed out at City Observatory, much of this affordability problem is self-inflicted, due to the severe limits that local zoning codes put on new development.  In sharp contrast, to the high cost of housing is the low, and mostly zero price we charge for parking in the public right-of-way.  This under-pricing of parking is a central and unacknowledged problem in urban transportation: The price is wrong. Underlying traffic congestion, unaffordable housing, and the shortage of great urban places is the key fact that we charge the wrong price for using roads.

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Nowhere are the effects of mispriced roads more apparent than on-street parking. Only for car storage do we regularly allow people to convert a scarce and valuable public space to exclusively private use without paying for the privilege. In neighborhoods that don’t charge for on-street parking, we have have a system that can only be described as socialism for private car storage. The public sector pays for the entire cost of building and maintaining roads, and even in dense urban settings with high demand, we allow cars to occupy those without paying a cent.

As chronicled in painstaking detail by the godfather of parking wonks, UCLA professor Don Shoup, free parking encourages additional driving, reduces the vitality of urban neighborhoods, makes it harder for local retailers to survive and needlessly drives up the cost of housing. A growing number of urbanists are coming to embrace Shoup’s viewpoint, spelled out in his 700-page tome “The High Cost of Free Parking,” but many of us still cling to the outdated illusion that parking is and should forever be “free.”

For the most part, the pitfalls of poorly priced parking go unrecognized and unexamined — we get stuck in congestion and complain about the shortage of parking. But we don’t typically recognize how the wrong price is the root cause of these problems.

Every once in a while though, there’s an event that shines a bright light on the consequences of parking socialism, and demonstrates how getting the prices right can fix things in a hurry. The most recent example is Portland Oregon’s reform of its handicapped parking system.

For years, the rampant abuse of Portland’s generous handicapped parking system was obvious and well-known. On downtown streets, a blue handicapped placard traditionally entitled users to park for free, as long as they liked. In Oregon, all that is required to get a handicapped permit is a note from one’s doctor and a trip to the DMV. As casual visitors to downtown have observed, entire blocks were occupied from early morning until night by rows of cars, each with a deep blue handicapped placard hanging in its rear view mirror.  In an apparent epidemic of frailty, the number of handicapped permits in use in downtown Portland almost doubled between 2007 and 2012. In September 2013, handicapped placard users occupied fully 1,000 of the central city’s 8,000 metered on street spaces.  Portland’s situation is hardly unique, the City of San Francisco reports that 20 percent of its on-street parking spaces are occupied by vehicles with handicapped parking permits.

In July 2014, that all changed. Led by Commissioner Steve Novick (full disclosure: Steve is a long time friend), the city limited free parking to wheelchair users who possessed a special permit. Those with generic handicapped placards can still largely ignore maximum time limits, but they have to pay for the space they use. The city even created special “scratch off” parking tags so that users wouldn’t have to walk to meters to pay:  you can see all the details of the new system here.

Overnight, the parking landscape in downtown Portland changed. Spaces occupied by placard users dropped 70%. Getting the price right freed up 720 parking spots for other, paying users, expanding the effective supply of parking by nearly 10%. The results of the change are described in a report prepared by the Portland Bureau of Transportation.

Press reports of the days following the policy reported an eery abundance of vacant on-street parking spaces.

Two weeks after Portland began charging drivers with disabled placards to park in the city’s metered spots, enforcement officer J.C. Udey says he doesn’t recognize his downtown beat. The days of patrolling block after block — after block — lined with the same cars displaying blue placards appear to be over. “It’s open spaces,” he said. “We have so much more parking.”

Brad Gonzalez of Gresham, who was shopping at the Portland Apple Store on Monday, said he couldn’t remember the last time he found a curbside parking spot in downtown so easily. “I found one right away near the store,” Gonzalez said. “It used to be about circling the block and getting lucky, and getting frustrated. Most of the spots were taken by cars with disabled parking signs. It was obvious that there was a lot of abuse.”

The change is even more remarkable in the heart of the central business district. I looked at the six most central parking beats in the city—for those familiar with Portland, an area bounded by Burnside Street on the north, the Willamette River on the east, Jefferson and Market Streets on the south, and 10th and 11th Avenues on the west. (These are beats 1,2,3,4,6 and 11). This area contains a total of about 1,850 on-street metered parking spaces. A year ago, 450 spaces–nearly a quarter of them–were occupied by vehicles with handicapped placards. That’s fallen to 105 placard users–a reduction of 75 percent from the free-parking era. This is the equivalent of adding about 350 parking spaces to the supply of street parking in the heart of downtown Portland.

Freeing up on-street parking spaces makes the transportation system work better: people don’t circle endlessly searching for a “free” parking space; paying customers eager to make purchases can park closer to their destinations, and local governments can use meter revenue to make improvements to the neighborhood that make it more pleasant for residents.

The city’s new report doesn’t spell out how much additional revenue the city stands to make as a result of the change.  A good rough estimate would be that the city nets about $10 per meter per business day; if so, it would clear an additional $1.4 million per year (700 meters times $10 times 200 business days). Parking meter revenues help pay for street maintenance and improvements, which the city says are badly under-funded—so this change will help reduce that gap.

Portland’s Bureau of Transportation is currently undertaking an effort to study and recommend new parking tools policies for city neighborhoods. Hopefully they recognize the lessons from pricing handicap spaces downtown and apply sensible pricing schemes in other areas to make the city’s neighborhoods even greater.

The larger lesson here should be abundantly clear: charging users for something approaching the value of the public space that they are using produces a transportation system that works better for everyone. When we get the prices right, or even closer to right, good things happen. We can’t solve our parking problems until we admit that when it comes to city streets, the price is wrong.   

Parking: The Price is Wrong

Posted on by Joe Cortright

There is a central and unacknowledged problem in urban transportation: The price is wrong. Underlying traffic congestion, unaffordable housing, and the shortage of great urban places is the key fact that we charge the wrong price for using roads.

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Nowhere are the effects of mispriced roads more apparent than on-street parking. Only for car storage do we regularly allow people to convert a scarce and valuable public space to exclusively private use without paying for the privilege. In neighborhoods that don’t charge for on-street parking, we have have a system that can only be described as socialism for private car storage. The public sector pays for the entire cost of building and maintaining roads, and even in dense urban settings with high demand, we allow cars to occupy those without paying a cent.

As chronicled in painstaking detail by the godfather of parking wonks, UCLA professor Don Shoup, free parking encourages additional driving, reduces the vitality of urban neighborhoods, makes it harder for local retailers to survive and needlessly drives up the cost of housing. A growing number of urbanists are coming to embrace Shoup’s viewpoint, spelled out in his 700-page tome “The High Cost of Free Parking,” but many of us still cling to the outdated illusion that parking is and should forever be “free.”

For the most part, the pitfalls of poorly priced parking go unrecognized and unexamined — we get stuck in congestion and complain about the shortage of parking. But we don’t typically recognize how the wrong price is the root cause of these problems.

Every once in a while though, there’s an event that shines a bright light on the consequences of parking socialism, and demonstrates how getting the prices right can fix things in a hurry. The most recent example is Portland Oregon’s reform of its handicapped parking system.

For years, the rampant abuse of Portland’s generous handicapped parking system was obvious and well-known. On downtown streets, a blue handicapped placard traditionally entitled users to park for free, as long as they liked. In Oregon, all that is required to get a handicapped permit is a note from one’s doctor and a trip to the DMV. As casual visitors to downtown have observed, entire blocks were occupied from early morning until night by rows of cars, each with a deep blue handicapped placard hanging in its rear view mirror.  In an apparent epidemic of frailty, the number of handicapped permits in use in downtown Portland almost doubled between 2007 and 2012. In September 2013, handicapped placard users occupied fully 1,000 of the central city’s 8,000 metered on street spaces.

In July, that all changed. Led by Commissioner Steve Novick (full disclosure: Steve is a long time friend), the city limited free parking to wheelchair users who possessed a special permit. Those with generic handicapped placards can still largely ignore maximum time limits, but they have to pay for the space they use. The city even created special “scratch off” parking tags so that users wouldn’t have to walk to meters to pay:  you can see all the details of the new system here.

Overnight, the parking landscape in downtown Portland changed. Spaces occupied by placard users dropped 70%. Getting the price right freed up 720 parking spots for other, paying users, expanding the effective supply of parking by nearly 10%. The results of the change are described in a new report released by the Portland Bureau of Transportation.

Press reports of the days following the policy reported an eery abundance of vacant on-street parking spaces.

Two weeks after Portland began charging drivers with disabled placards to park in the city’s metered spots, enforcement officer J.C. Udey says he doesn’t recognize his downtown beat. The days of patrolling block after block — after block — lined with the same cars displaying blue placards appear to be over. “It’s open spaces,” he said. “We have so much more parking.”

Brad Gonzalez of Gresham, who was shopping at the Portland Apple Store on Monday, said he couldn’t remember the last time he found a curbside parking spot in downtown so easily. “I found one right away near the store,” Gonzalez said. “It used to be about circling the block and getting lucky, and getting frustrated. Most of the spots were taken by cars with disabled parking signs. It was obvious that there was a lot of abuse.”

The change is even more remarkable in the heart of the central business district. I looked at the six most central parking beats in the city—for those familiar with Portland, an area bounded by Burnside Street on the north, the Willamette River on the east, Jefferson and Market Streets on the south, and 10th and 11th Avenues on the west. (These are beats 1,2,3,4,6 and 11). This area contains a total of about 1,850 on-street metered parking spaces. A year ago, 450 spaces–nearly a quarter of them–were occupied by vehicles with handicapped placards. That’s fallen to 105 placard users–a reduction of 75 percent from the free-parking era. This is the equivalent of adding about 350 parking spaces to the supply of street parking in the heart of downtown Portland.

Freeing up on-street parking spaces makes the transportation system work better: people don’t circle endlessly searching for a “free” parking space; paying customers eager to make purchases can park closer to their destinations, and local governments can use meter revenue to make improvements to the neighborhood that make it more pleasant for residents.

The city’s new report doesn’t spell out how much additional revenue the city stands to make as a result of the change.  A good rough estimate would be that the city nets about $10 per meter per business day; if so, it would clear an additional $1.4 million per year (700 meters times $10 times 200 business days). Parking meter revenues help pay for street maintenance and improvements, which the city says are badly under-funded—so this change will help reduce that gap.

Portland’s Bureau of Transportation is currently undertaking an effort to study and recommend new parking tools policies for city neighborhoods. Hopefully they recognize the lessons from pricing handicap spaces downtown and apply sensible pricing schemes in other areas to make the city’s neighborhoods even greater.

The larger lesson here should be abundantly clear: charging users for something approaching the value of the public space that they are using produces a transportation system that works better for everyone. When we get the prices right, or even closer to right, good things happen. We can’t solve our parking problems until we admit that when it comes to city streets, the price is wrong.