On Jan. 1, 2023, California embarked on something of a grand experiment in one of its most crucial if overlooked sectors — parking.
That was the day legislation known as Assembly Bill 2097 went into effect. Authored by Laura Friedman (D-Glendale), it eliminated parking mandates within a half-mile of major transit stops. Developers and business owners were free of local rules dictating how many spaces for cars they had to create when building a project.
For many people, the hope was that this would turbo charge housing construction in California. The idea was that the money saved by relaxing parking requirements would allow developers to build more units and get through the approvals process faster. Then there were all the ancillary benefits of less driving and more people riding mass transit.
Two years later, the effects of that change are not precisely what supporters expected, but they are profound. Stubbornly high interest rates and other factors have slowed overall housing development, dampening the potential to quickly reshape the economics of residential construction. But for Eddie Navarette, AB 2097 is a “game changer” for other reasons.
He is known as“Fast Eddie.” His downtown L.A.-based FE Design & Consulting specializes in helping restaurant and bar owners navigate the permitting and zoning minefields that line the path to opening. Navarette said that in the past, the bureaucratic process of satisfying vehicle requirements and getting sign-offs from planning department officials could take months. AB 2097 means there are no parking minimums — the benefits are not limited to housing — and thus, there’s less to evaluate.
“I would say it cut time for most projects by at least a third,” Navarette said recently. “This cuts down fees for [businesses hiring] professionals. It cuts down what the city has to spend on engineers having to evaluate these things. It also puts money back into the prospective operator, who’s starting out on a shoestring budget. That’s like issuing a check right back to them, that 30% of time that they’re saving.”
Seeing this play out is welcome, if not a surprise, to Mott Smith, a Los Angeles developer who has long championed sensible parking reform. This includes making permanent the COVID-era shifts that allowed restaurants to turn some parking spaces — whether street-front or in a lot — into outdoor eating areas. Al fresco dining kept many businesses afloat during the pandemic, but many expected it to disappear once COVID-19 receded.
When Gov. Gavin Newsom signed the bill in September 2022, Smith, who also serves as chairman of the Council of Infill Builders, predicted that restaurant and retail businesses would be among the beneficiaries. In early August, he mused on how well it has worked, particularly in Los Angeles.
“AB 2097 truly made it possible for the city to be very forward-looking in approving permanent al fresco dining,” he told Blueprint.
The price of parking
Parking is one of the most misunderstood aspects of city-building, an afterthought in transportation planning. Seen by many drivers as nothing less than a right — a feeling enhanced by the endless spread of surface lots and towering garages — its impacts have taken decades to recognize. UCLA Urban Planning professor Don Shoup’s 2005 book The High Cost of Free Parking was an important contributor to changing that. Shoup’s work revealed how free street spaces or inexpensive meters led directly to congestion and air pollution: Drivers cruised for spots, making traffic the cost of cheap parking.
Housing projects also are the product of parking rules, which impose a minimum number of spaces per unit or resident. Smith is among those who say the basic math was frequently way off. “The zoning code requires us to build more parking than is used,” he said, “even in the most generous of circumstances.”
The price is staggering: Friedman noted that in a garage, each parking spot costs $24,000 to $34,000 to build, and that can climb to $65,000 per underground space. The cost, naturally, gets passed on to tenants, often in the form of higher rents. In a city consumed by the high cost of housing, the cost of parking is a major, if underappreciated, contributor.
In November 2022, Michael Manville, a professor of urban planning at the UCLA Luskin School of Public Affairs, authored an “economic letter” anticipating what AB 2097 would bring. A key was simply understanding the bill: It did not, as some fretted, ban parking anywhere. Instead, it abolished mandates in specific zones, allowing a developer to create as much or as little parking as she or he desired, responding to the needs of tenants and the restrictions of lenders (who might worry that a project with limited parking would have difficulty attracting residents).
In fact, San Diego experimented with that idea in 2019. When the parking mandates were lifted there, the city saw a spike in both affordable and market-rate housing production.
Although other factors have intervened and diminished the housing implications of AB 2097, Manville is bullish on those prospects as well. He and Smith both point to how lifting mandates allows a developer to be more efficient on a tight urban parcel. For example, a site zoned for 20 units may not be financially viable if parking requirements cut away space and mean just 15 apartments can be constructed. Those extra residences provide the profit, and thus a reason to build.
“What we’re likely to see in the future,” Manville said in an interview, “is some developers taking advantage of this for things they had lined up; maybe not permitted but were planning to permit. They’re taking advantage of the law to not use as much parking.”
He added, “I do think it’s opening up possibilities for both market-rate developers to again make development feasible on some parcels it would not have been otherwise, and affordable development as well.”
Manville will be watching closely. He noted that the UCLA Institute of Transportation Studies has hired a postdoc to follow the progress of AB 2097. An early focus involves tracking how different cities interpret the law.
The long game
Passing land-use legislation in California is notoriously thorny, with lawmakers having to negotiate with unions, business organizations, environmental groups and others. The first quote in Friedman’s press release announcing Newsom’s signing of AB 2097 stated, “I’ve been working on this for two years now.”
But one of the most interesting components of her work is the long game she’s playing. During an interview in mid-August, Friedman noted that some developers are taking advantage of the opportunity to build less parking, but she seemed equally interested in the doors that the bill can open.
“To make this work, the other part of this has got to be that the cities provide better public transportation,” Friedman said. “Already these zones are near major transit, but it’s true that not everyone is always using only that transit stop.”
It’s a realistic and nuanced take on transportation, and one that is particularly important in Los Angeles, where tens of billions of dollars are being spent on enhancing and expanding the regional bus and rail system but where challenges include the perception of safety. This is augmented by the fact that many Angelenos will instinctively hop in the car for an errand or short drive, never considering if mass transit, biking or walking could suffice.
All of which is a reminder that transportation policy often quickly envelops the full range of issues — from climate change to affordable housing. AB 2097 is a piece of that very complex puzzle.
And the initial returns on that bill, according to experts, are indeed positive; for example, any business that Navarette helps get across the finish line creates jobs, generates tax revenue and enhances street life.
Smith and Manville point out that a number of cities in California have historically used parking mandates as a tool to combat any new development. Smith notes that with AB 2097, some municipalities may have to be more transparent with their opposition to new housing, especially lower-income projects. Still, it’s hard to imagine that a state law will propel an open embrace.
Friedman’s take gets to the idea that even forward-thinking legislation only does so much. As hard as passing a bill is, getting municipalities to improve transit to the point where a substantial portion of the citizenry will choose an alternative to driving may be much more difficult.
But the reasons for doing it, and making AB 2097 a springboard to greater change, are, in her view, essential.
“Every bit of parking we don’t build,” she said, “is environmentally much more sustainable. That’s a tremendous amount of concrete, trucking, fuel, metal, with huge greenhouse gas and pollution impacts. It’s definitely a positive to see parking as a scarce resource and to use it better.”
