Parking rate hike will harm New Orleans retail

Lakeside Mall over the Riverwalk. Sam’s Club in Kenner over Costco in Mid-City. Any cinema in Metairie over those in New Orleans. Raising parking fees in New Orleans will push customers to businesses outside the parish. Increasing fees and extending meter hours would be counterproductive for New Orleans’ retail boom. For a family wanting to spend a day enjoying New Orleans, parking fees would rise 280 percent in the French Quarter and 133 percent in the rest of the city.

Remarkably, the increase would make operating a private parking facility—either as a surface parking lot or a garage with multiple levels of parking—more profitable, and it would slow down the conversion of parking lots to residential and mixed uses. Everyone can agree that New Orleans benefits when surface parking lots are eliminated in favor of new high-rises full of families and offices. When public parking meter rates are hiked, private parking lot operators benefit for free and can artificially raise prices because the baseline price of their product—parking—has just been increased.

Encouraging locals to shop, eat, and entertain themselves downtown is a key component of reviving New Orleans’ retail sector. If I told a potential customer that the cost of parking all-day in the French Quarter would nearly triple, I can guarantee that he would make his purchases elsewhere. Instead of spending a day filled with shopping and dining in the French Quarter, a family might save time and money by making only one transaction or avoiding my neighborhood altogether.

When I want to get a haircut and pick up some groceries, I would prefer to give my business to French Quarter establishments, but ample free parking, convenience, and widespread options outside of downtown sometimes take my dollars away to places like Metairie. If consumers stop coming to New Orleans or cut back on purchases from local establishments, increasing the cost of parking could easily lead to lower sales tax receipts for the city. A sudden surge in parking fees would harm New Orleans’ fragile retail, and the city’s businesses could not handle another likely shock from higher gas prices, increased sales taxes, or greater operating costs such as more security. The meager increase in revenue from the parking fee hike—roughly $4 million—could imperil our city’s more important and unprecedented boom in sales tax receipts, which grew nine percent last year and underpins the recent pay increase for the NOPD.

– William Khan
This article originally published in the November 2, 2015 print edition of The Louisiana Weekly newspaper.