$2 Chicago Congestion Tax Will Increase Congestion

Unintended Consequences

The proposed $2 “Congestion Fee” additional parking tax will cause enormous problems.  The tax applies only to those parking in commercial parking garages.  This tax will not affect street parking rates nor residential garages and that is part of the problem.  By taxing one group of spots and not the other, it causes a litany of issues and other problems.

Traffic Downtown Will Increase

Currently street parking in Chicago is very difficult to find.  A study recently done by parking guru Donald Shoup found that 30% of congestion is caused not by people on their way somewhere, but those cruising around looking for a place to park.  Currently rising street parking rates have made commercial garages and surface lots competitive with previously artificially low street parking rates.  By adding a congestion tax to these lots they become artificially more expensive causing people to cruise around EVEN more looking for that coveting and cheaper street parking spot.

Pedestrian Deaths Could Increase

More people cruising and around looking for street parking spots causes congestion to increase.  Frustration from the increased traffic and inability to find street parking spots will only make already stressed drivers more anxious.  It’s very possible that more people late to appointments and meetings will be texting while driving in order to alert those they will be late.  All of these factors could lead to more pedestrian fatalities.

Increased City Pollution

As more vehicles circle the streets looking for parking, more emissions will result from the extra driving.  Cars and trucks that sit idle behind these cruising vehicles emit more emissions than they otherwise would have.

Local Businesses Sales Will Suffer

Increased traffic will make it less pleasant to commute to the city.  A planned outing to a theater, restaurant and night on the town becomes prohibitively stressful due to the uncertainty and stress from choking congestion.

Congestion Tax Has Good Intentions but is Misguided

There are good intentions here.  Rapid transit and a new rail line could really help the city of Chicago.  However, increasing taxes exclusively to only one group of parking spots has unintended and harmful consequences.  The commercial parking lot operators already share one of the highest tax burdens.  Adding another tax to only them is misguided and certainly needs to be reassessed.  

One response to “$2 Chicago Congestion Tax Will Increase Congestion”

  1. Anonymous Avatar

    Interestingly, more congestion and adverse environmental factors are caused by street parking, not indoor commercial lots… street parking generally lends to a higher probability of short term parking, given the maximum allowable time is 2 hours in most City parking zones. Short term parking means greater movement in vehicles and also causes more “engine starts”, a known emission issue.

    But let’s be a bit capitalistic for a moment and let’s look at the tax itself… a $2 tax on top of an already significant parking tax plus property taxes?… Combined, this could impact a commercial garage’s gross margin by 50%… that’s before operating costs (electric, equipment, insurance, cleaning, labor, supplies, etc) and more importantly, interest expense carry (which is significant, no thanks to recent construction costs). This makes it nearly impossible to turn a profit expect for the most busy garages (which by their very nature, are likely causing the congestion… but this is likely the 10% club out of parking garages). If the government thinks that “normal” garages can pass this cost to the consumer, they have no idea how challenging the business is these days. The macro economic conditions that face the City and Country are equally manifested in the garages. Less workers, shoppers, and tourism all negatively impact parking volume and ultimately result in lower parking rates (thereby furthering the problem). What will the owners of parking garages do?…. Stop paying their mortgages (gee, this is a new problem), reduce labor (nice for the City’s long-term unemployment issues), cut back on costs (again, local business support will be impacted) and in general, keep pushing the economy down instead of up.

    The purpose of the tax is to provide CTA with stops along Michigan Avenue and at McCormick place, among other places… how about direct taxing those who are going to benefit? Perhaps this is in direct conflict with what the Fed’s are pushing with their grant money, but doing what’s right requires a little push back.