In Lieu Fees – A Good Idea – I don’t Think So

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In Lieu Fees – A Good Idea – I don’t Think So

Scottsdale AZ has a problem and it’s not just the suffocating heat in the summer. They charge in Lieu parking fees to businesses in its downtown core. Read all about it here.

In Lieu are fees that are paid by businesses that don’t have enough parking to fit the requirements of the local planning boards. In other words, if you open a restaurant and planning requires 15 spaces and you only have 10, you can pay the city an “in lieu” fee and they will let you go ahead and open your restaurant.

The problem is that these fees can be onerous – in this case a restaurant who is already paying $2200 a month would have to add an additional $500 to open a patio. They say that it would bring in more business and hence more sales tax, but the city is adamant. Pay the fee on no patio. The merchants complain that they are paying for phantom parking spaces, parking that doesn’t exist. The local city moms and dads feel that the fees keep the parking in check.

Building owners talk of stores sitting empty because of the in lieu fees. The city says the money ensures that there will be enough parking. The merchants say that there is plenty of parking.

I say that it shouldn’t be the city’s business to provide parking for the merchants. If the merchant feels there is enough parking, then so be it. If there isn’t enough and it’s a problem, they will go out of business and the free market will make it right. Planners trying to predict parking requirements years in advance aren’t the solution.

The vice mayor’s comments ring hollow to me:

The problem is the parking program was established many years ago in order to provide enough parking in the downtown area, and if it hadn’t been established . . . then today there might not be adequate parking for their particular business,”

If parking is needed, the marketplace will build it. Scottsdale merchants say plenty of parking, including structures, exist. The “in lieu” fees deter new businesses (because they are most likely to come under the fees). In this case, more restaurants and bars in the area would bring more customers for all merchants. However the parking requirements or fees slow that development.

Parking requirements slow downtown development and skew the types of businesses that can locate in areas. If parking becomes an issue, there are many alternatives. However if there is no business, there are no alternatives.

IN the UK, in lieu fees are used in a different way. They are fees charged if you HAVE parking. They force businesses to remove parking so people won’t drive and will walk, bike, or take public transportation. Employees then search for other jobs, stores and factories close and move elsewhere. Yeah, that makes sense, too.

JVH

John Van Horn

John Van Horn

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