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The Regents of the University of California

VOL. 25. NO.13 APRIL 26, 2005

UCLA parking woes rooted in faulty pricing

By Donald Shoup

Recalling the late UC President Clark Kerr’s famous comment that the chancellor’s job has come to be defined as “providing parking for the faculty, sex for the students, and athletics for the alumni,” Chancellor Albert Carnesale recently remarked that campus priorities had changed.

“At UCLA,” he said, “parking is the most important issue for everyone.” UCLA has more parking spaces than all but one other university in the United States — Texas A&M. How could parking have become more important than sex for students when scarcity is obviously not the problem?

UCLA’s parking woes emerge from mispricing, not scarcity. One particular policy, UCLA’s “point system” for student parking, creates especially serious problems. A student’s chance of receiving a parking permit is based on a jumble of factors, with distance from home to campus being the chief measure of the “need” for parking. But a study commissioned by UCLA Transportation Services found that students frequently lie about their addresses to get enough points for a permit. Although the point system fails to allocate parking spaces fairly, efficiently or ethically, perhaps it has one educational value: It trains students to prepare income tax returns.

Instead of the flawed point system for student parking, UCLA can use prices to manage demand: Charge the lowest price that will keep a few spaces vacant at every location, so that drivers will always find a convenient space near their destination. This is the Goldilocks principle of parking prices: The price is too high if many spaces are vacant, and too low if no spaces are vacant. When a few spaces are vacant everywhere, the price is just right. If a parking shortage or surplus regularly occurs at any time in any location, the price can be increased or reduced, thereby preserving a few vacancies during peak hours and filling spaces that would otherwise be vacant during off-peak hours.

UCLA sells about 10,000 parking permits to students either for the quarter or the year. Because permit-holders pay up front, and nothing extra for parking on each trip, this practice invites them to drive to campus alone, encourages overuse of scarce spaces during peak hours, and leads to shortages that generate demands for even more campus parking. Further, the permit system poorly serves students who drive to campus only occasionally and do not stay all day.

A better alternative is to charge a marginal cost for parking, but no fixed cost. The universities of Oregon and Wisconsin use in-vehicle parking meters (which resemble debit cards) to pay for parking. Drivers pay for parking on every trip, and only for the exact time they use — no more, no less. This encourages everyone to consider alternatives to solo driving for each trip. Why not give BruinGO a try if it costs only 25 cents, as opposed to paying for parking if you drive?

Flexible prices are fair, efficient and transparent, especially when compared with UCLA’s clumsy point system for allocating student permits. Market prices for parking will favor high-occupancy vehicles and short-term parkers, accommodate occasional users, and create opportunities for individual choice. Perhaps most important, UCLA’s “point system” will no longer drive students to dishonesty.

Shoup, a professor in the School of Public Affairs, is the author of a recent book, “The High Cost of Free Parking.” A longer version of this article is available at www.bol.ucla.edu/~shoup.



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