EMPLOYER-SUBSIDIZED PARKING AND WORK-TRIP MODE CHOICE

Abstract

The widespread practice of employer-subsidized parking is a significant but often overlooked determinant of mode choice for the journey to work. Experiences in several major cities are examined, and estimates are made as to how many of those who are offered employer-paid parking decide to drive alone to work rather than commute by other modes. It appears that approximately 20 percent of those who now drive alone and receive free parking would form carpools or begin using public transit if they were required to pay for parking at the workplace. This estimate is derived from comparisons of the behavior of commuters of similar characteristics who park free and who pay to park and from the results of the imposition of parking charges for parking formerly provided free. The major incentive for employers to provide free parking appears to be the fact that, as a fringe benefit, free parking escapes income taxation. Enforcing the reporting and taxation of its cash value, however, is a difficult and predictably unpopular task. Two policies intended to extend employer parking subsidies to work travel by modes other than the single-occupant automobile are recommended: tax-exempt travel allowances and carpool parking subsidies. Both policies could lead to significant increases in carpooling and transit use at very low or no public expense. (Author)

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