Don’t Drive To Work, and You May Be Eligible for Extra Cash

The Los Angeles Times is reporting today on a little-known state law, called the Parking Cash-Out Law, that requires certain employers who provide subsidized parking for their employees to offer a cash allowance in lieu of a parking space. The intent of the law is to reduce vehicle commute trips and emissions by offering employees the option of “cashing out” their subsidized parking space and taking transit, biking, walking or carpooling to work. The state has a good page with lots of information.

Under the Parking Cash-Out program, employers must pay a stipend equal to the cost of a parking space to workers who do not drive to the office. The law covers public and private employers that have at least 50 employees and that offer free parking in a leased lot. However, a lot of employers don’t know they are required by law to do this. Further, State officials have no idea how many businesses are required to offer the cash inducements, much less how many of them actually do. Wednesday, Los Angeles City Council’s Transportation Committee will consider how to go about implementing and enforcing the law. Currently, only Santa Monica enforces the law, where provisions of the statute were incorporated into a traffic management ordinance. In 2002, it was estimated that just 3% — or an estimated 290,000 of the state’s 11 million employer-paid parking spaces — are subject to the law. About 84% of the free parking spaces are exempt because they are employer-owned.

The Southern California Assn. of Governments estimates that 95% of the people who drive to work park there for free. However, 17% of all drivers offered cash in exchange for their free parking space will give up their vehicles.

Some employers offer free bus passes and other incentives to reduce car emissions under regional air quality guidelines. Those entities can satisfy smog-reduction requirements and the state law by incorporating parking cash-out subsidies. For example, where I work, we get up to $105 a month, tax-free, in our paychecks if we are on a vanpool: this reduces my cost of commuting to between $20-$40/month — a price that can’t be beat!

Currently, the law’s many exemptions make enforcement difficult. For now, it is “complaint driven”. Possible violations may be reported by calling (800) 952-5588 or the local air district. The statute includes a $500 fine per vehicle for noncompliance, but no one has been fined.