Start charging for street parking
Of all the “far left” policies promoted by Mayor-elect Zohran Mamdani, the promise to make buses free has gotten some of the most attention. This is true even though some of his other policies would be significantly more expensive or far less workable.
For example, his own campaign estimates that universal free child care will cost approximately $6 billion a year, roughly equal to the entire budget of the New York Police Department. His affordable housing program calls for the city to spend approximately $10 billion a year. He has also proposed spending $1 billion for a new department focused on mental health outreach. Free buses are estimated to reduce the MTA’s revenue by $600 million to $800 million annually, a loss that would have to be made up somewhere.
Supporters say the additional spending Mamdani’s proposals would necessitate can easily be financed by raising taxes on higher-income New Yorkers and corporations. But for better or worse, the city has no authority to change its tax on incomes in any way. That ability rests with the state Legislature and governor, and Gov. Hochul has shown little interest in raising taxes to finance Mamdani’s proposals. Her position on this matter is not likely to change as her race for reelection against a serious challenger from the Republican Party heats up.
But there is an untapped funding source that could pay not just for free buses, but for free subways as well: parking fees.
There are approximately 3 million parking spots in New York City that allow people to store their vehicles overnight for absolutely no cost. Add them up, and those spaces occupy around 11,000 acres of land, or 5.6% of the city’s total area. Mini-storage is a massive business in this space-starved city, but it’s completely free for people to store one type of private good. This begs the question of why we are charging people to use environmentally friendly buses and subways, thereby discouraging their use, while providing free car storage for polluting, traffic-inducing, pedestrian-harming vehicles, thereby encouraging their use.
It wasn’t always this way. Free overnight parking only began in 1954. At the time, the City rejected a parking tax of $60 per year (more than $500 in today’s dollars).
Why should we reconsider a decision that was made over 70 years ago? Because if the City metered all of its parking spots, it could collect $3.8 billion annually by charging just $3.47 per spot per day. The City could then transfer that revenue to the MTA to completely cover the approximately $3.8 billion per year the MTA would give up by ending fares on both buses and subways, making the city’s mass transit system totally free.
That $3.47 charge per day is an average. The charge could be higher in more dense and affluent areas and lower or nonexistent in poorer areas and for low-income or disabled people who need cars.
Such a shift of expenses from transit riders to car owners should appeal to a mayor focused on affordability. Not only do many more lower-income New Yorkers rely on mass transit rather than private cars to navigate the city, but many more New Yorkers in general rely on mass transit rather than private cars. Making all public transit free would also encourage more trips to see friends and family, participate in the city’s cultural offerings, attend work or classes, and, in general, participate in all that the city has to offer, thereby benefiting not only transit riders, but the city itself. Free subways could supercharge Mamdani’s affordability agenda as they carry significantly more than twice as many riders as the city’s buses and are heavily used by people commuting to jobs.
Striking this deal — charging for parking in exchange for making transit free — would more than just enable the new mayor to live up to one of his key campaign promises. It would enable him to overdeliver on one of his promises, something that almost never happens in politics and could really excite New Yorkers.
My back-of-the-envelope estimate doesn’t even factor in all of the benefits. For example, the MTA plans to spend $1.1 billion over the next five years just to upgrade fare gates at 150 subway stations, about a third of the system. This is an expense that will completely disappear along with the crime of fare beating, and the associated social and penal system costs. Although such savings would not directly inure the MTA, they could easily be used to further subsidize the MTA or provide other services for the city. Car owners would also benefit to some extent: They would waste less time looking for parking spots and driving around in traffic as more people choose mass transit to get around.
The current policy of providing free storage for car owners was a mistake in the 1950s and it’s a mistake now. After three-quarters of a century, the policy of charging for mass transit while providing free storage for car owners is overdue for some fresh thinking.