Chapter 3 Current Conditions of Curb Parking in Taipei
3.2 Land Use Efficiency in Curb Spaces
3.2 Land Use Efficiency in Curb Spaces
For many years of study, there is no trouble in understanding that a good curb parking planning can resolve the parking shortage and eliminate several external costs such as traffic congestion. However, we rarely think of the possibility that an inadequate curb parking planning not only brings about social externalities but also results in a severe waste of land resource in the city.
Taipei City Ten-Year Parking Plan (臺北市十年停車計畫) proposed to attain the full use
of curb spaces by higher turnover rate. The idea of quantifying parking utilization is favored, but parking turnover fails to show how effectively the parking spaces are occupied and leaves out the connection to the land. What a higher parking turnover indicates is a higher average number of “cars” that successively occupy a curb space daily. A probable situation can be that curb parking’s turnover rate is high, but half of the curb spaces still remain empty during the peak time. Furthermore, if parking turnover is estimated from small samples and is conducted at different places and at different times, they may be a misleading guide for parking planning (Shoup, 2005). Therefore, in this study, we employ parking occupancy as an alternative to estimating land use efficiency. Parking occupancy or, say, parking index, is the ratio of the number of spaces occupied to the total spaces available within a time duration. It shows to what extent the land is in use. Land use efficiency would be better off if the parking occupancy is high or at least curb spaces are fully occupied during the peak time.
To concentrate our attention on land without distractions from the difference between
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the compact cars4. The following analyses are threefold; we first bring up an astounding number to denote how curb spaces encroach upon the urban land. Next, we put parking occupancy in perspective; the low occupancy rate during the peak demand for parking signifies an unconscious abuse of the land. Finally, we estimate such waste of land in monetary terms. The low return on investment in curb parking explains why curb spaces may not be a wise investment of land. The government should act wisely to redistribute the money and propose a more rational curb parking planning.
3.2.1 Curb Parking Eats Up Urban Land
The Department of Transportation has the estimated number of curb spaces in Taipei City over the last decade. Figure 3.2 shows the estimated number from 2010 to 2017. The number ranged between 47,000 and 59,000 and exhibited a stable trend. In addition, in 2016, to implement a user-charge price reform on all curb spaces, the city government reorganized the on-street parking thoroughly. This price reform led to an outlying surge of an additional 13.5 percent of supply that amounted to approximately 7000 parking spaces.
However, knowing the number of curb spaces alone failed to understand the extent to which curb parking has encroached upon the city. Given that the size of a regular compact-car curb space varies from 10 to 15 square meters5, curb parking over the last decade has eaten up 470,000 square meters (47,000 × 10𝑚𝑚2) to 885,000 square meters (59,000 × 15𝑚𝑚2)
4 Compact car in this thesis follows the definition given by Taipei Parking Supply and Demand. Any automobiles, including 550cc motorcycle, that are able to park in the curb spaces which are 2 to 2.5 meters wide and 5 to 6 meters long are viewed as compact cars.
5 According to Article 190 of the Traffic Sign Markings Installation Regulations (道路交通標誌標線號誌 設置規則), curb spaces for compact car are 2 to 2.5 meters wide and 5 to 6 meters long. The land area of a curb space for compact car, thus, ranges between 10 to 15 square meters.
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of urban land. It is stunning to think of putting 66 to 124 football fields in the center of the city for using them only as curb parking.
Figure 3.2 Number of Parking Spaces in Taipei (2008-2017)
Sources: Taipei City Department of Transportation and Construction Management Office
3.2.2 Forever Empty Curb Spaces Represent an Inefficient Use of Land
In a city where every inch of land is gold, allocating an enormous amount of land as curb spaces is never the highest and best use. However, it would not be unacceptable if there is a real demand. To verify such demand, think of the occupancy rate of curb parking during the peak time (i.e., when parking demand is among the highest): all curb spaces should be taken; otherwise, it will be an oversupply of curb parking at all times. Excessive curb spaces indicate the inefficient use of land in that they can never meet the parking demand nor be put into other uses — they appear to be always vacant and that is a waste of resource.
-3.2% -2.5%
48,603 47,070 45,888 47,780 49,208 49,695 49,222 51,229
58,163 58,906
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Change in the number of curb spaces for compact car (%)
Number of curb spaces for compact car
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Each year Taipei Parking Supply and Demand Analysis (臺北市汽機車停車供需調查) discovers the parking occupancy through a survey of curb parking. This analysis divides the city into the northern and southern parts and takes turns to investigate one of them every other year. In 2016, the investigation fell on six northern districts, and it pointed out that 2,747 curb spaces were empty during the peak period. In 2017, the study turned into the other six southern districts and found that there were 1,745 empty curb spaces at the peak time. These numbers may seem small for empty curb spaces took up no more than 10% of total on-street parking. They, however, signified the presence of extensive vacant lands, with the size as big as almost eight football fields, in the city.
3.2.3 The Government Fritters Land Resources Away Unconsciously
Vacant land has always been a controversial topic. Some cities around the world tax vacant lands to encourage development and avoid speculation. In Taipei City, though vacant land tax is presently not enforced, privately-owned vacant land should at least pay the land value tax. Nevertheless, empty curb spaces at all times are vacant lands in disguise. Neither did they serve for public use6 nor pay the property tax. In the year of 2017 alone, Taipei City government unconsciously squandered 56,925 square meters and lost over NT$50 million of tax revenue on empty curb spaces. If the urban planners continue ignoring the inefficiency caused by these always-empty curb spaces, in the long run, the abuse of land will only be enlarged.
6 Under the Land Tax Act Article 20,public land specified for public use is exempted from land value tax.
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Furthermore, an intriguing discovery among such abuse of land is that empty curb spaces do not evenly scatter in location, but instead cluster in one or two districts. Take the six southern districts as an example (see Table 3.2, rows 8-13), three-fourths of empty curb spaces during the peak time are located in Nangang district; while the other five districts attained a high occupancy rate of above 90 percent. Similar patterns appear in the investigation of six northern districts. Four-fifths of empty on-street parking are intensively distributed in Neihu district and Zhongshan district, with parking spaces in other districts are almost fully occupied. This phenomenon explains why many drivers still find it difficult to search for a curb space in Taipei, despite the existence of vast vacant spaces. The uneven distribution of empty parking spaces signifies that different districts may encounter completely different parking problems. The government should employ a more customized parking planning to improve the overall land use efficiency.
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Table 3.2 Distribution of Always-empty Curb Spaces at Peak Time
District DSR Parking Supply Parking Demand Gap Wasted land (𝑚𝑚2)
*DSR: demand to supply ratio or the occupancy rate.
*Gap: the gap between parking supply and demand at peak time (parking demand−parking supply); this shortage depicts the number of all-time vacant curb spaces.
*Wasted land is the product of the number of always empty curb spaces multiply by the average size of a curb space.
Sources: Data of six northern districts is from 2016 Taipei Parking Supply and Demand Analysis.
Data of six southern district is from 2017 Taipei Parking Supply and Demand Analysis.
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3.2.4 Curb Parking is an Inefficient Use of Land, Financially Speaking.
Another way to put land use efficiency in perspective is to compare the achieved effect and the land resource consumed for curb parking in monetary terms. As we have mentioned before, curb parking is a unique product that can only be provided by the government. In consequence, curb parking charge could produce monopoly rent because of government’s monopolistic behavior and the exclusive use of curbside spaces. Therefore, if we stand in the government shoes and think about its cost and revenue, we may weigh the land cost and parking revenue to assess curb parking’s land use efficiency.
Figure 3.3 The Coverage of Parking Fees in Taipei (June 2015-May 2018) Source: Taipei city Department of Transportation and Construction Management Office
Figure 3.3 shows that the price reform in 2015 has led to a significant increase in the coverage of parking fees. There was 59.99 percent of curb spaces paying parking fees in
59.99%
Number of charged parking space Number of uncharged parking space The coverage of parking fees
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spaces are already charged. The Department of Transportation has started the estimation of the monthly curb parking revenue in Taipei City since 2007. Table 3.3 shows the revenue of curb parking in Taipei for the last decade. The last row of the Table shows that the government collected NT$1.61 billion from 58,906 curb spaces in 2017. The average annual revenue per curb space was, therefore, NT$27,369 (𝑁𝑁𝑁𝑁$1.61 𝑏𝑏𝑏𝑏𝑏𝑏𝑏𝑏𝑏𝑏𝑏𝑏𝑏𝑏 ÷ 58,906).
For the land cost, we refer to the assessed present land value7 which reflects the price level of land in transactions. On average, the assessed present value of land used for roads per square meter was NT$1,858,777 in 2017. One curb space is about 10 square meters measured in the Taipei Curb Parking Map (台北市路邊停車格位圖)8; thereby, the return on investment (ROI) of each curb space is then 0.147 percent ( 𝑁𝑁𝑁𝑁$27,369 ÷ (𝑁𝑁𝑁𝑁$1,858,777 × 10)).
This ratio suggests that the government, if acting as a rational investor, should not invest in curb parking. In the current low interest rate environment, the return of investing in curb spaces is far lower than the average office rental yield at 2.3 percent9. Clearly, it is financially unwise to put the land into curb parking. As far as land use efficiency alone is concerned, the government should at least shift some curb parking spaces for other uses of land and charge curb parking at a higher rate.
7 Assessed present value of individual land parcels are assessed annually by the Department of Land Administration. This value serves as the tax base of Land Value Increment Tax (LVIT) imposed on the transaction of land. In 2017, the assessed present value is about 91% of the market value.
(Source: The Department of Land Administration, Ministry of Interior.
https://www.land.moi.gov.tw/chhtml/landvalue.asp?cid=100)
8 Taipei Curb Parking Map is a shapefile data published by the Department of Transportation of Taipei City. In this paper, the data was retrieved on 29th June, 2018.
9 JLL ranked the net rental yield of top six commercial real estate markets in Asia and Taipei was ranked at the last place with a figure of 2.3%.
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Table 3.3 Annual Revenue Earned from Curb Parking Spaces
Year Number of
curb parking
Curb parking revenue (NT$ billion)
Revenue per curb space (NT$/ curb space)
2008 48,603 NT$ 1.60 NT$ 32,937
2009 47,070 NT$ 1.45 NT$ 30,801
2010 45,888 NT$ 1.28 NT$ 27,922
2011 47,780 NT$ 1.20 NT$ 25,097
2012 49,208 NT$ 1.24 NT$ 25,161
2013 49,695 NT$ 1.08 NT$ 21,791
2014 49,222 NT$ 1.31 NT$ 26,568
2015 51,229 NT$ 1.33 NT$ 26,005
2016 58,163 NT$ 1.61 NT$ 27,624
2017 58,906 NT$ 1.61 NT$ 27,369
Source: Taipei City Department of Transportation.
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In the previous chapter, we illustrate the current situation of land use efficiency in curb parking. We suppose the minimum standard of efficient land use is that curb parking must be fully occupied at least at peak time. Hence, peak-time parking occupancy was employed as an essential index to denotes how much land resources are frittered away.
In this chapter, we go one step further, attempting to tackle the problem of inefficient land use at its roots. We extend our discussion to the potential factors of parking occupancy and explore any method that can result in better land use efficiency.
As we have reviewed in chapter two, getting the right price for curb parking works to achieve the target occupancy rate, and the rule of thumb for transportation predetermines this target. The decline in parking fees, first, increase the quantity demanded of curb spaces; then because parking supply is fixed in the short run, parking occupancy increases correspondingly.
In this paper, the proposed model deals with the effect of parking fees on the quantity demanded and the vacancy rate of curb spaces. We are eager to know by getting to what price we eliminate the oversupply of 4,462 spaces at peak time and get full use of every piece of land10. The subjects of our study are the curb parking of the compact car in Taipei City. The period of time that we study here is between 2015 and 2016. Due to the data characteristics, this two years of data do not provide us with time-series information, but only with a set of cross-sectional data.
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This research utilizes the linear regression model to explore how pricing brings about efficient use of land. We employ parking occupancy as the proxy of land use efficiency;
and due to the price mechanism mentioned above, as short-term supply for curb spaces is fixed, our empirical analysis is twofold. First, we regress the quantity demanded of curb parking on parking fee. Second, we examine how effective parking fees are in changing the vacancy rate of curb parking. Other possible influence on curb parking such as the quantity supplied of parking spaces and the number of illegal parking are also included to complete the model. The population model is written as:
𝑌𝑌𝑑𝑑 = 𝛽𝛽0+ 𝛽𝛽1𝑥𝑥1𝑑𝑑+ 𝛽𝛽2𝑥𝑥2𝑑𝑑+ 𝛽𝛽3𝑥𝑥3𝑑𝑑+ ⋯ + 𝛽𝛽𝑝𝑝𝑥𝑥𝑝𝑝𝑑𝑑+ 𝑢𝑢𝑑𝑑
where 𝑌𝑌𝑑𝑑 represents the dependent variable (i.e., it can be the quantity demanded of curb parking or the vacancy rate of curb spaces in this study); and 𝑥𝑥𝑑𝑑 are independent variables such as parking fee; 𝛽𝛽0 is the intercept and 𝛽𝛽1 to 𝛽𝛽𝑝𝑝 are the coefficients;
𝑢𝑢𝑑𝑑 is the random and stochastic error term; and finally, the subscript 𝑏𝑏 denotes the 𝑏𝑏th observation.
To estimate the regression parameters, we utilize the commonly used method, ordinal least squares (OLS). The sample regression model can be written as:
𝑌𝑌�𝑑𝑑 = 𝑏𝑏0+ 𝑏𝑏1𝑥𝑥1𝑑𝑑+ 𝑏𝑏2𝑥𝑥2𝑑𝑑+ 𝑏𝑏3𝑥𝑥3𝑑𝑑+ ⋯ + 𝑏𝑏𝑝𝑝𝑥𝑥𝑝𝑝𝑑𝑑+ 𝑒𝑒𝑑𝑑
where 𝑏𝑏 is the estimator of the coefficient 𝛽𝛽 and 𝑒𝑒𝑑𝑑, called the residual, is the estimator of the error term 𝑢𝑢𝑑𝑑. This method estimates the parameter of the population (mean) regression function (PRF) by minimizing the least square error term:
min �( 𝑌𝑌�𝑑𝑑−
𝑛𝑛 𝑑𝑑=1
𝑏𝑏0− 𝑏𝑏1𝑥𝑥1𝑑𝑑− 𝑏𝑏2𝑥𝑥2𝑑𝑑− 𝑏𝑏3𝑥𝑥3𝑑𝑑 − ⋯ − 𝑏𝑏𝑝𝑝𝑥𝑥𝑝𝑝𝑑𝑑)2