Playing With Politics

A Blog on Law, Politics, Planning, Development, and Other Vices

Improving Jack London Square

Posted by Roobs on October 19, 2010

It’s been two months since I moved from Berkeley to West Hollywood to pursue a masters degree in urban planning from UCLA.  Though I am hundreds of miles away, I find myself in class thinking of practical uses of concepts back in the East Bay.  Often times, Oakland is a good candidate for many.

In one class, we discussed two, not very dissimilar concepts for district improvements.  The first was the idea of a parking meter zones (PMZ), as proposed by “prophet of parking” and UCLA professor, Donald Shoup.  The second is the concept of a business improvement district (BID) or a community benefit district (CBD).  Each together and individually have the potential to bring out Jack London Square’s, and Oakland’s in general, true potential.

I’ve wanted to write a post to this effect for some time and am very happy that my time at UCLA has allowed me to finally move forward.

Parking Meter Zones (PMZs)

Nobody likes to pay for parking.  You put your coins or credit card in the machine and out pops a ticket or the little meter just reads green and that’s it.  Who knows where your money went.  And in a city like Oakland, you probably think your revenue didn’t really go where you want it.  So when you have situations when parking meter prices are increased, you get what Oakland had earlier in the year – a parking meter revolt.  Well, enter the Parking Meter Zone.  Donald Shoup describes PMZs as areas where the city charges market-rate prices and agrees that the revenue from all parking meters goes to improvements in the district itself. Market-rate pricing is based off current demand for parking in that area. So in areas where parking is really hard to find (high demand) parking rates go up until spots become available. In areas where parking is plentiful (low demand) parking rates go down until they become utilized. (See video at end of post for more info)

The best example of this happened in the City of Pasadena, just East of Downtown Los Angeles.  An area of the city, now known as Old Pasadena, had decayed into an unattractive district by the 1980s.  There were no parking meters in the area until 1993 and customers could often find little available parking.  The city proposed to put parking meters on the curb to regulate the use of parking but businesses protested against the idea because they thought it would discourage their customers from coming.  The city and business owners debated for years until the City of Pasadena agreed that all revenue from the parking meters in the area would go to pay for improvements in the district.  Things like: lighting, streetscape, alley repair, etc.  As soon as the businesses realized that the money from parking meters went to them, they quickly agreed to the deal to install parking meters.  As Shoup has said, hey had a clear vested interest in having meters and raising money from parking because they knew the money was going back to them.

The City of Pasadena borrowed $5 million on the parking meters projected revenue to fund the street improvement projects.  In 2001, the meters started earned around $1.2 million in revenue, of which, a little less than half was spent on repaying the $5 million loan. The rest of the funds went back to pay for services above those already provided by the city, such as extra police patrols, extra street sweeping and garbage collection.

(Read Donald Shoup and Douglas Kolozsvar’s paper on PMZs in Pasadena here.)

If you have ever strolled down Colorado Blvd. in Pasadena, you can see the brilliant fruits of this deal.  “Old Pasadena” has gone from a dilapidated district to a beautifully kept district and now one of Southern California’s premier and most desirable shopping areas (a Tiffany’s now occupies what was once a tattoo parlor).

Business Improvement Districts (BID), Community Benefit District (CBD)

BIDs are special assessment districts where merchants and/or property owners band together and agree to assess themselves a tax that goes into a general fund.  The assessment is usually based off the size of the property as opposed to business sales.  This fund is then spent on improvements within the district, not given to the city.  CBDs are essentially the same thing but focus on residential areas vs. commercial.  If you have ever lived in a condominium or community with a homeowners association and had to pay a HOA due, that is the same thing.  You are paying an extra fee to a separate group that is to spend that money on benefits to the homeowners.

There are a few BIDs currently operating in Oakland.  One in particular is the Downtown Oakland BID, which assesses each member business to help pay for things like extra street sweeping and garbage collection above what the City of Oakland already provides.

I first learned of BIDs when I was working for a law firm in Emeryville.  It came up when I was asked to research Federal Quiet Zone designation regarding freight and passenger rail.  Briefly, Quiet Zones are basically zones where a train is prohibited from sounding its horn within the zone, except in the case of  emergencies.  So when a train crosses the street, where it normally would whistle, now it does nothing, leaving the notification alert to the grade crossing safety features, such as the lights and descending traffic arms that block the street.

This came up because many of the new residents of Jack London Square complain about the noise of this very active train corridor, especially at night.  However, in order to be granted Quiet Zone designation, a city must upgrade all necessary safety features at train crossings (such as the lights and traffic arms) so that the whistle is no longer necessary.  Unfortunately, this all must be paid for by the city and Oakland, like many other cities, is in the midst of a budget crisis and doesn’t have the hundred of thousands of extra dollars to upgrade its train crossings to Quiet Zone standards.  As a result, it was suggested that Jack London Square pursue a BID where the assessment of member businesses could be used to pay for these upgrades.  But because I left to attend grad school, to date, I am unaware if this path was pursued or completed.

Jack London Square

Jack London Square is an area of Oakland south of Downtown between the I-880 freeway and the Oakland Estuary.  It has experienced a boom in economic activity during the early part of the decade with new retail and residential developments.  Even during the present economic environment, the district still enjoys some benefits and is hailed as one of the true up-and-coming areas of the Bay Area. However, that does not mean it doesn’t have problems such as street conditions, safety, transients and blight, that could be vastly improved.

PMZ in Jack London Square

According to documents from the ad-hoc Jack London District On-Street Parking Improvement Committee (JLDOSPIC) in 2003 the district was inventoried to have a total of 1,830 on-street parking spaces.  Of those, only 324 are metered.  The rest are either free or time-limited by signs, not meters.  The metered parking reported to bring in $290,000 annually in revenue (FY 02-03), which amounts to approximately $895 per meter in the same fiscal year.

Using these same numbers and data from the JLDOSPIC study, additional meters could be added to Jack London District that is primarily commercial, which is the area primarily to the West of Broadway.  My map below mirrors the JLDOSPIC study area:

The blue area represents the Jack London District and conceptual BID/CBD.  The red area represents the streets that currently have metered parking as well as streets that could add metered parking.

Even at conservative estimates, potentially 400 new parking meters could be added to the proposed area, adding an additional revenue of $358,000, bringing total revenue from meters to $648,000 annually.

BIDs and CBDs in Jack London Square

Past the parking meters, we can look at a BID and CBD in the district.  A BID and CBD can be created in Jack London where the assessment of the the commercial property in the district as well as those from residential properties can be collected into one general fund.

While BIDs and CBDs are not always based on the same means of collection doesn’t meant they can’t be clumped together.  I believe it is more than possible to have the benefits of all three PMZs, BIDs and CBDs in mixed-use districts such as Jack London.

Now I admit I do not have the information to give a quality estimate of the potential revenue that such a combination would create.  It would depend largely on the amount taxed to each businesses and residential property.  But from past readings, I can say it would probably be quite a bit that could be added to the $650,000 brought in from the PMZ described above, likely near $1 million that can be used for district-specific improvements.

Potential Difficulties

First, There are differences between this proposal and the example in Pasadena.  Old Pasadena didn’t have parking meters to begin with.  So when the deal to divert the revenue from the city to the district, it didn’t negatively impact the city treasury, since they never counted on that money to begin with.  On the other hand, Jack London Square does have some parking meters.  As stated, the city gained $290,000 in revenue from those meters, revenue that would be lost if it agreed to no longer receive that money and divert it to the district.

Solution: While it is true that Oakland would lose around $290,000 in revenue from JLSq parking meters, it can not be underestimated the amount of new tax revenue that could be gained from an improved Jack London Square that would have the potential to dwarf the $290,000 lost.

Second, as suggested, PMZs are usually only in commercial areas, as are BIDs.  CBDs are usually in residential areas.  Pasadena is an example of a PMZ and a BID merging successfully but there isn’t an example of a CBD and PMZ merging, usually due to the fact that CBDs are usually in the infamous gated community, where meter parkings are un-necessary.

Solution: The most ideal outcome would be for the property owners in JLSq to recognize the benefits of having a single benefit district so that improvements could be carried out district wide.  However, the simplest answer may be the best one, which is to let the BID and CBD exist independently of one another with each using their collected revenues for their own specified improvement projects.  Given the fact that JLSq is zoned decently segregated, with most business on one side and most residential properties East of Webster, cross-over could be kept at a minimum.  PMZ funds would be spent only within the PMZ area, which would be primarily within the BID.

Third, due to the economy, many of the new residential properties in Jack London have been turned into leased units, meaning rented.  CBDs work well in communities where residents own their home.  When the area is mixed renters and owners, it becomes ambiguous as to how the rules are laid out.  Owners can be assessed based on the property they own, such as the square footage of their condo.  However, renters cannot because they do not own their home.  So this begs the question of how to collect funds.  Should residents be assessed differently based on whether or not they own their home?  Should the CBD ignore the homeowners and, like BIDs, assess the overall building and collect from the building owner?  If so, would that cost be sent back to the residents in some form?  Would it be better to just levy a blanket fee on  residents, regardless of homeownership?

Solution: Given the mixed variety of homeowners and renters, it may prove more appropriate to assess the building owners vs. individual homeowners and tenants.  Whether or not the property owners chose to shift that cost onto the homeowners and tenants (as sales tax is shifted to the consumer) would be up to individual property owners.

Fourth, the conceptual map above illustrates a very basic and easy to understand layout of this benefit district.  However, many BID’s are not as nicely shaped.  This is due to the fact that not every business, or every residential property for that matter, will opt to join.  Therefore, when all is said and done, the BID could look very clustered or sparse, depending on what businesses agree to join, which will also affect how improvements are dealt with.  The map below depicts a conceptual BID and PMZ map with Cost Plus, Bed Bath & Beyond, Amtrak, County offices and residential properties opting out.

Solution (kinda): This problem doesn’t really have a solution so much as it just requires understanding that not all BIDs are as nicely organized over space and that each business will make a judgment on whether or not they should join.  The most ideal situation is for each business to recognize the benefits of paying for extra service to improve their district.

This leads to a fifth potential complication.  Allocating money from a combined improvement district could prove complicated if not every property owner agrees to be assessed or pay a fee, but do join the PMZ.  For example, if Bed Bath & Beyond and Cost Plus World Market refuse to join the local BID but do benefit from the PMZ, improvements funded by BID assessments could not be done to their benefit.  For example, 2nd Street between Jefferson and Clay could not be repaved using funds from property assessment or fees but could be repaved using funds collected from the PMZ. To use BID funds to benefit two businesses who have not paid for the extra service would cause dissatisfaction and lack of trust within the BID and likely lead to its eventual collapse, as more businesses will expect to benefit without having to pay into the BID.

Solution: The solution is essentially in the problem, which is that PMZ funds should be kept separate from BID funds.  The PMZ acts as a potential leveler in the cases where some properties may chose to opt out of the BID.

Conclusion

From a policy perspective, I believe a prudent first step would be the creation of a PMZ.  This would require only the discussion of removing the revenue collection from the City of Oakland to the new PMZ and installing the new meters themselves.  But as I said, the potential new tax revenue from an increasingly burgeoning Jack London Square could offset any loss.  It would also require discussions with business owners in the proposed PMZ to agree to have new meters installed.  While a common critique of meters is that they drive away customers, it has been shown that when businesses know the money is being spent on improvement to their surrounding area, they are more likely to agree to the meters.  These parking meters would also be set at a market rate to help ensure available parking for customers.  The Old Pasadena example is a great success story that should not be viewed solely as a fluke like many “after” photos of TV diets.  The potential to to help Jack London Square maintain its upward growth is worth the effort and investment. This money can and should be used for improvements to the street-scape, such as lighting and landscaping, but also with the streets and sidewalks themselves. The Quiet Zone i referenced above could be created with this money to help with the overall quality of life for residents. More street sweeping and extra police patrols could be contracted with this money. The possibilities are there. All that is left is education and implementation.

Video on SF Park (an example of “market-rate” pricing on parking meters)

Roobs is a Urban & Regional Planning Masters student at UCLA concentrating on Transportation Planning & Policy and Urban Design & Development.  He is a former 6 year resident of Berkeley and graduate of UC Berkeley with a BA in Legal Studies & Sociology.

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One Response to “Improving Jack London Square”

  1. You made some good points there. I did a search on the topic and found most people will agree with
    your blog.

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