Op-Ed: How to Fix Pacific Place Garage

Of course, the problem could also be the model Pacific Place shopper (pictured) won't fit beneath the low ceilings of a parking garage.

This morning, the Seattle Times broke the story that the city-owned Pacific Place parking garage has been "losing nearly $500,000 a year and unable to keep up with rising debt payments." City leaders are wondering what to do, and have hired a consultant to look into the problem. 

I've been using Occam's Razor a lot lately--if I could, I'd shave with it and save a ton of money--so I wonder if a consultant is needed. The thing is, the parking garage worked like a charm for the first eight to ten years of its existence. Even though it was priced below market rate, at $2 per hour, it made up enough in volume (it parks 1,200) to pay for its debt and operations.

It's just that more recently, between 2004 and 2009, use has fallen almost 18 percent, says the Times' Emily Heffter. In 2008, it failed to make enough money to pay for itself. (By city ordinance, it's forbidden to make a profit or build up substantial cash reserves.) In tandem with use falling, the parking rate there has increased to $5 per hour.

It's as if, in a microeconomic sense, there's some indefinable but real-world relationship between the cost of parking and the number of people willing to park there--while at the same time, there's the macroeconomic effect of a major economic downturn having taken place.

To rejigger an old expression, "If it wasn't broke before, undo whatever you did to fix it." In this case, that would seem to indicate rolling back prices. (This doesn't mean you should lower on-street metered parking rates; they are being used so much they're never open, which indicates that most people find them a good deal, comparatively.)

People profess to be puzzled that, in terms of the competitive arena, Pacific Place's decline in usage has been larger than neighboring garages. Here is my hypothesis. Pacific Place is the only city-owned parking garage allowed simply to "break even" downtown. While its prices beat everyone else, it could siphon off business from all the other market-rate enterprises that actually attempt to make money--that is, it had a much broader pool of potential customers than people shopping at Pacific Place. When its price increases moved it into competition with everyone else, it began to lose business to every other parking option.