33 percent hike would be first since 2019 in city of Cape May
CAPE MAY — City residents and visitors may see an increase in parking meter costs this summer for the first time since 2019.
Martin Van Walsum, chairman of the Municipal Taxation & Revenue Advisory Committee (MTRAC), presented City Council with a strategic overview of parking fees and practices April 21.
Van Walsum thanked former chairman Dennis Crowley for “laying the groundwork for what MTRAC does.”
“One of Dennis’ favorite quotes is ‘It’s not MTRAC’s job to be liked,’ and I’m probably going to follow that example tonight in talking about parking fees.”
City Council had asked MTRAC was asked by to review parking fees and practices to determine the city’s position relative to other local communities.
Recommendations
“It’s an important objective to try to understand what it is we’re trying to do with our parking fees,” Van Walsum said, adding the revenue is important but so is turnover, especially in the business districts.
MTRAC recommends the city consider increasing parking fees across the board to $2 per hour, a 33 percent increase.
“It’s actually 5 percent a year on a compounded rate, which is about what labor costs have gone up over the course of the five years,” Van Walsum said, noting fees have not increase since 2019.
They considered an increase to $1.75 per hour (17 percent) but that was impractical because the city has a lot of coin-operated meters.
“We’re almost locked into going just as we did from $1 to $1.50, going from $1.50 to $2 because of the way the meters are programmed and where the mechanism works,” Van Walsum said. “The $2 will put us right smack in the middle of seven beach towns that charge for parking.”
MTRAC is also suggesting restoring performance pricing premium in the business district to twice the standard rate ($4 per hour) and enforcing 3-hour time limits.
Additionally, it is suggesting increasing permit fees for surface lots, which have been static for five years. The Jackson Street lot fee would increase from $700 to $875 (25 percent) and the Bank Street lot fee from $350 to $425 (21 percent).
“The rest of the town will still be $2, but if they want to park close to their destination, we want to make sure that there are spots there for them,” Van Walsum said. “In order to ensure that happens, it’s necessary to charge more.”
Van Walsum said MTRAC predicts the parking increase would amount to 2 cents on the tax rate.
Another suggestion was to have all meters operational through Dec. 31, which Van Walsum said would eliminate visitor confusion for two months.
“It would have minimal impact on homeowners and employees of businesses,” Van Walsum said. “They would simply have to continue to do what they do from April 1 to Oct. 31 for two more months.”
If coin meters were eliminated (another recommendation), Van Walsum said they could make annual or biannual adjustments to parking rates.
City Manager Paul Dietrich said he would ask City Council to recommend setting $2 as the standard rate throughout the city.
“Let’s implement that now, because that’s an easier conversation point to have,” Dietrich said. “I think some of the other issues are worthy of discussion [and] I think that’s going to take a deeper discussion with council and a broader network to see where we would want to land on that.”
He added that MTRAC is awaiting information from ParkMobile on the average and maximum lengths of stay across different zones.
Deputy Mayor Maureen McDade said more data was needed for variables in the business district.
“I see the $2 as simply keeping pace,” Van Walsum said. “I would be careful about not raising the mall rate and having to be the same because we will build behaviors very quickly.”
Background
The data, which Van Walsum said was compiled using ChatGPT, was supplemented with information from municipal websites. The “metered” parking refers to any parking space that requires a fee, via physical meters, kiosks annual or weekly permits, or parking payment apps (ParkMobile).
“One thing ChatGPT did not pick up on is the fact that Stone Harbor announced an increase in parking rates in January,” Van Walsum said. “I was also really surprised that most of the municipalities in Cape May County do not have any information on their websites about parking, just tons of information on how to use ParkMobile.”
Van Walsum noted that parking is a serious issue in Cape May and changes to parking fees or structures, however minor, are uniformly met with strong public opposition.
He added that he had read “Paved Paradise: How Parking Explains the World” by Henry Grabar and this quote stood out: “We expect parking to be immediately available, directly in front of our destination, and most importantly, free. It would be unimaginable to hold any other good or service to the same standard.”
“That’s not just Cape May, that’s universal,” Van Walsum said. “People have been killed over arguments about parking spots; it’s an incredibly volatile topic.”
Several factors have led to an increase in the need for parking spots, which Van Walsum identified as the growth of the number of automobiles per family and the significant increase in the use of private homes in Cape May as rental properties, resulting in an increased reliance on on-street parking for static cars.
“Today, many of the unmetered spots in greatest demand are occupied 24/7 by residents in lieu of utilizing driveways or by overflow from short-term rental clients, for six plus hours by beachgoers, and other visitors for eight plus hours by employees during their shifts,” he said, adding that quicker turnover is needed.
Revenue has also become another important component in parking matters. Van Walsum said in 2019, a variant of performance pricing was introduced, doubling the metered rate near the Washington Street Mall to $2 an hour, with a limit of three hours.
In 2020, the metered rates for all areas not affected by the 2019 changes were increased by 50 percent, to 25 cents for 10 minutes and $1.50 per hour, their current rate. The change was intended to offset the revenue losses from COVID, taking effect in late summer 2020.
By 2021, the seasonal permit rates were doubled from $350 to $700 at the Jackson Street lot, and by 133 percent at the Bank Street lot from $150 to $350 and have remained unchanged since. There is currently a waitlist for both lots.
“Every municipality has its own needs for parking,” Van Walsum said. “What Cape May needs is different from what Wildwood needs, and what Stone Harbor needs is different from what Avalon needs.”
Competitive positioning
During the presentation, Van Walsum shared a graphic of competitive positioning for metered prices, with several cities having varying seasons, hours, maximum time limits and permits.
“There will be a comparison in visitors’ minds, how much does it cost to find parking in Cape May and how available is parking versus in neighboring towns,” Van Walsum said. “People do tend to make the decision to visit Cape May not just [based] on how much parking costs.”
Mayor Zack Mullock said several towns had a wide range of parking costs, and prime locations would be at the higher end.
“We have our most expensive parking near the business district. In Wildwood, it’s the beachfront attraction,” Van Walsum said. “In Wildwood, the beach is free but you’re paying $5 an hour for parking.”
Van Walsum noted that the average parking fee across the six towns (Cape May, the Wildwoods, Stone Harbor, Avalon, Sea Isle City and Ocean City) is $2.75 per hour.
Van Walsum said MTRAC found metered parking has different hours in effect in various parts of the city. Metered parking is generally in effect from 10 a.m. to 10 p.m. April 1 to Oct. 31.
Exceptions include the business district, which is April 1 through Dec. 31. Beach Avenue and a block in from Philadelphia Avenue to Pittsburgh Avenue are 10 a.m. to 5 p.m.
“The word among visitors is they don’t know where they have to pay for parking or not and they are, in MTRAC’s opinion, frustrated by the fact that we have some of these differentials,” he said.
With the benefit of hindsight, Van Walsum said the concerns expressed by small-business owners in 2019 regarding performative pricing were unsupported.
“Our business district is more popular than it has ever been, meaning that the demand for parking is higher than it’s ever been,” Van Walsum said.
He said a parking spot turns over one additional time in just 10 percent of the spots in town, which is the equivalent of having five percent more parking spots in the city.
“Our hypothesis is for 50 cents an hour more, I’m going to park on Carpenters Lane if I’m going to the beach and that’s the first spot I can find,” Van Walsum said. “We don’t want people parking on Carpenters Lane that are going to the beach for six hours. The takeaway point is $1 is not always $1, it may be $1 of revenue but that $1 that gets $1 more, that gets a parking spot to turn over more often, is worth more than $1 to the businesses in the city of Cape May.”
By RACHEL SHUBIN/Special to the Star and Wave