BILL ANALYSIS
SENATE TRANSPORTATION & HOUSING COMMITTEE BILL NO: AB 1186
SENATOR ALAN LOWENTHAL, CHAIRMAN AUTHOR: Blumenfield
VERSION: 6/24/09
Analysis by: Mark Stivers FISCAL: No
Hearing date: July 7, 2009
SUBJECT:
Employer parking leases
DESCRIPTION:
This bill requires a lessor of parking spaces, for any lease
entered into on or after January 1, 2011, to provide an employer
who is subject to the parking cash-out law with itemized parking
costs.
ANALYSIS:
Current law, known as the parking cash-out law, requires each
employer with 50 or more employees that offers a parking subsidy
to employees to provide an employee who does not use the parking
space with a cash allowance in an amount equivalent to the
subsidy offered to parkers if the following conditions apply:
The employer employs at least 50 persons, regardless of the
number of work sites.
The site of employment is located in an air basin designated
non-attainment for any state air quality standard.
(Practically speaking, this means every county except Lake
County.)
The employer provides free or subsidized employee parking on
leased spaces (i.e., on spaces the employer does not own).
This bill requires a lessor (e.g., owner or operator) of parking
spaces, for any lease entered into on or after January 1, 2011,
to provide an employer who is subject to the parking cash-out
law with itemized parking costs in either of the following
forms:
AB 1186 (BLUMENFIELD) Page 2
As a separate line item in the lease, or
In a document provided to the employer within 30 days after
execution of the lease.
COMMENTS:
1.Purpose of the bill . There is widespread agreement that
employers are not complying with the existing parking cash-out
law. In part, this is because it is difficult to calculate
the value of employee parking when it is included with the
total cost of office rental space. Many owners of commercial
real estate "bundle" the cost of parking with the cost of
office space into a single lease price. In order to
facilitate compliance with the law and achieve the traffic
congestion and air pollution benefits that the parking
cash-out law promises, this bill requires parking owners to
provide employers subject to the cash-out law with unbundled
parking costs. The author states that expanded participation
in the parking cash-out program will help local governments
comply with greenhouse gas emission reduction targets.
2.The benefits of parking cash-out . In a 2002 study entitled "A
Commuter's Dilemma: Extra Cash or Free Parking," the
Legislative Analyst's Office (LAO) found that the parking
cash-out law is inexpensive to administer and offers numerous
benefits, including easing traffic congestion, improving air
quality, reducing greenhouse gas emissions, promoting social
equity, and supporting investments in other travel modes. The
report cited a 1990 study in Los Angeles and Ottawa, Canada
that found a 41 percent average reduction in solo driving when
employees had to pay to park. The LAO also noted a 2000
survey of Bay Area commuters, which found that while 77
percent of commuters drive alone to work when free parking is
available, only 39 percent do so when they have to pay to
park. Moreover, only 4.8 percent commute by transit when free
parking is available, while 42 percent commute by transit
without free parking.
A 1997 study conducted for the Air Resources Board examining
the impact of the parking cash-out law on commute behavior
found:
Solo driving dropped 17 percent, from 76 percent to 63
percent of employees.
Carpooling increased by 64 percent, from 14 percent to
23 percent of employees.
AB 1186 (BLUMENFIELD) Page 3
Transit use increased by 50 percent, from 6 percent to 9
percent.
Combined bicycling and walking increased 33 percent,
from 3 to 4 percent.
Vehicle miles traveled, along with their associated
emissions, decreased by 12 percent per employee per year.
Implementing parking cash-out resulted in an average
reduction in carbon-dioxide emissions of 367 kg (or nearly
half a ton) per employee per year.
3. Arguments in opposition . Opponents believe that
there is no nexus between unbundling the cost of parking and
employers providing non-driving employees with a cash-out.
Moreover, they are concerned that this bill will establish an
employee's right to inspect an employer's lease terms in the
event of a dispute over the amount of a cash-out payment.
4. Chaptering amendments . This bill has chaptering
conflicts with SB 728 (Lowenthal). The author will need to
take chaptering amendments to resolve this conflict.
RELATED LEGISLATION
SB 728 (Lowenthal) authorizes local entities to enforce the
provisions of the parking cash-out law. This bill is on the
Assembly Floor.
Previous Votes:
Senate EQ: 5-2
Assembly Floor: 57-20
Assembly Trans: 9-4
POSITIONS: (Communicated to the Committee before noon on
Wednesday,
July 1, 2009)
SUPPORT: City of Los Angeles (sponsor)
Breathe California
Coalition for Clean Air
Environmental Defense Fund
Natural Resources Defense Council
Planning and Conservation League
OPPOSED: Apartment Association of California Southern
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Cities
Apartment Association of Greater Los Angeles
Santa Barbara Rental Property Owners Association