Chapter and Bicycle Coalition Achieve Potential

Payments for Not Driving (and Smaller Parking Lots) in Cupertino


Background: Every city has off-street parking ordinances. They were first implemented in the 1940s, to protect neighborhoods from the intrusion of parked cars. They essentially require businesses to provide parking for everyone who might drive. An acre of land parks less than 120 cars. Parking lots consume so much land that they force destinations to be spread out, encouraging auto use. They greatly increase the cost of doing business, especially where land is expensive. At places where people work, individual employees cannot recoup the wage decrease caused by the required parking, even if they never use it. New policies are needed. The policy advocated in Cupertino is one approach. The Chapter sent Cupertino a letter supporting that approach.


In a dramatic April 18th 2006 Cupertino City Council Meeting, our Loma Prieta Chapter and the Silicon Valley Bicycle Coalition (SVBC) achieved a significant victory regarding “car-parking cashout” at places of employment. Such “cashout” had been defined as a program whereby an employer pays each employee an extra amount whenever that employee gets to work without driving. The April agenda item concerned a car-parking cashout proposal that had been suggested during Cupertino’s General Plan (GP) update. It was my honor to have worked on that proposal, which unfortunately had been turned down during the GP discussion. I represented the Chapter and the SVBC at the April meeting.


The General Plan cashout recommendation was to amend the city’s off-street parking ordinances with two new paragraphs. The first would have been a definition of “Car Parking Cashout at Places of Employment,” as presented above. The second would have been a schedule of reductions in the parking-lot-size requirements as a function of amount paid. For example, a $4 per-day payment would earn a 10% reduction; a $6 per-day payment, a 15% reduction; and an $8 per-day payment, a 20% reduction. It was assumed that the staff would recommend actual values. It was also assumed that the paragraph would be worded so that the numbers could be adjusted on a case-by-case basis. For example, the paragraph might use the phrase, “such as” before listing the reductions. Companies that wanted to pay cashout would then negotiate with the Cupertino city staff to determine the exact reductions. The agree-to amount paid would then be considered “nominal”. The amount paid, on any given day, would then be adjusted so that, for example, the company would not have to pay an excessive amount if too many employees did not drive. The details are in the Power Point Charts included on this web site.  [choose pdf format or ppt (Powerpoint) format]


The proposal was inspired by a case-study of cashout published by Patrick Siegman, a transportation analyst at Stanford. It shows that cash payments significantly reduce driving to work. Fewer cars justify less parking. Since land is expensive, companies could earn enough money from the excess land to pay for the cashout. The Cupertino proposal included tables and plots showing 10 examples of cashout, in three groups: one with poor transit, one with fair transit, and one with good transit. They were taken from Siegman’s work, which provided a published reference for each example. The work supports two conclusions: first, reductions occur even when transit is poor and second, the overall average reduction is 23%. A table of the 10 examples is shown in the Power Point charts. [choose pdf format or ppt (Powerpoint) format]



The Figure below shows a cashout result at what happens to be a poor-transit location. Both bus and “bike/walk” use increased by 1,600 percent. The amount paid was $54/Month in 1995 dollars. Although this case is the best result in the case study, other cases were nearly as good and the overall results are stunning. Even the worst case showed a 15% reduction in driving. This would easily support a 10% reduction in the size of the parking lot. For a company with 1,200 employees, this would result in 1 acre of land. In Cupertino, an acre of land, zoned industrial is worth $3 million dollars. If the acre were to be rezoned to residential multi-family, it would be worth more than $4 million. Everyone in Cupertino knows that the city needs to mitigate its high cost of housing.





Cashout Results for CH2M Hill, an Engineering Firm in

Bellevue, Washington, Near Seattle


During the General Plan discussion, the Chamber of Commerce opposed cashout. Cupertino’s Bike/Ped Commission (BPC) offered no comment. Even so, Council Members Dolly Sandoval and Richard Lowenthal wanted to continue the discussion of cashout.


At the GP meeting where I mentioned that the Loma Prieta Chapter of the Sierra Club had sent a letter of support, Dolly stated that cashout was a “fantastic opportunity for the city”. Richard Lowenthal stressed that cashout was not being required of companies; it was a new choice. However, Council Members Patrick Kwok, Kris Wang, and Sandra James voted to end the discussion.


In November, 2005, Orrin Mahoney was elected to replace Sandra James. I later met with Orrin for just over an hour at Peet’s Coffee on Stevens Creek by De Anza College. He was skeptical of the numbers and told me that he would not favor changing the city’s ordinance before a company came to the city wanting to do cashout. I showed him the ten references used by the Siegman case study. I left not sure if he was still skeptical or not. I also left thinking that the city was lucky to have such a great guy on the council.


I finally got to meet with Chris Giusiana, the Chamber of Commerce CEO. The lunch time meeting started with Chris telling me that the Chamber had dropped its opposition. It was good news but I left the meeting still disappointed. To me, it is clear that the Chamber members should be the greatest advocates of cashout because it allows new flexibility and opportunity for positive growth. I have been unsuccessful in getting to meet with the Chamber Board of Directors. Still, the fact that they dropped their opposition was a great first step and I think it was a key factor in getting the success described below.


Meanwhile, the Bicycle/Ped Commision would not endorse cashout because the Council had killed it in the GP discussion. However, after I attended a meeting asking that they endorse cashout, Commissioner David Greenstein led them to formally request studying the proposal. His motion passed 4-1, over staff opposition. It resulted in a letter to the Council notifying them that they were asking for permission to study cashout. I left the meeting disappointed, not realizing how important their action was. This action set up the April 18th cashout discussion.


The historic April 18th discussion started with Vice Mayor Kris Wang attempting to re-establish a 3-member opposition to cashout. She ran the meeting because Mayor Lowenthal was out of town. She stated that she didn’t know why they were even discussing cashout, since the council had already voted the concept down in the General Plan. However, Orrin objected, stating that he would welcome a cashout company in Cupertino and would support decreasing their required parking. He mentioned Apple as a candidate. This established a majority of 3 Council Members that supported cashout. Dolly Sandoval and Richard Lowenthal had been supportive of the concept in the General Plan discussions and clearly wanted the City to work with any company that might decide to do cashout. After Orrin make his position clear, Kris softened her opposition. She stated that sure, if Apple wanted to do cashout she could support that. It was not clear if her support extended to other companies in the City.


The Bicycle Pedestrian Commission was not granted permission to study cashout. This hardly mattered since it was clear that the Council, by at least 3-2, wanted the Staff to give reductions in the parking requirements if a company paid a sufficient amount of cashout money.


If any reader enjoys Council drama, I recommend downloading the video of the April 18th meeting from the City’s website. If that doesn’t work, you can go to Cupertino and purchase the April 18th DVD for a very small price. The meeting also featured the Council discussing the BPC’s idea to make the City officially “Bicycle Friendly” and most importantly, Steve Jobs making Cupertino history, as described below.


Shortly after the meeting, I met with City Manager David Knapp. He assured me that he recognizes the majority opinion and accepts the validity and applicability of Siegman’s data. He told me that I needed to talk to Cupertino companies. I am working on that but I am finding it a difficult task.


The April 18th meeting started with Steve Jobs announcing that Apple was keeping its 2,500 employee campus and adding a 3,500 employee campus. This is probably the reason that Orrin mentioned Apple when he stated his cashout position. Subsequent reports revealed that Apple paid $165 million for 50 acres to support the expansion. Will Apple use the new cashout opportunity we have created? I have no crystal ball, but one thing is clear, if Apple does the math, they will do cashout. The Power Point Charts have the supporting calculations.


I have also taken the proposal to my own company, Lockheed Martin, in Sunnyvale, and have been told (in an October 31st Email) that they are seriously considering it. They did not question my assertion that Sunnyvale would ultimately take the same position as Cupertino.


Cashout has application anywhere that car parking costs are hidden. The success achieved in Cupertino could be replicated in any city where land is expensive and council members want to help their companies succeed. We also need to help our companies recognize this opportunity. Cashout can reduce costs, help to retain employees with increased pay, generate local housing opportunities (120 fewer cars produces 1 acre of excess land), and cause a company to be recognized as a progressive corporate leader.


Cupertino has a fine Council (all 5 members) and city staff, especially City Manager David Knapp and Director of Community Development Steve Piasecki. Years ago, Ex-Council member Don Burnett dramatically improved our proposal. The GP discussion brought about refinements to the proposal to protect all parties. These details are in the Power Point charts, [choose pdf format or ppt (Powerpoint) format] which are essentially how they had evolved by the time I sat down with the City Manager. Please call me at 408-739-1982 or Email me at, if you have comments.