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Inspired by last month’s guest post and my own trip to Fort Worth this weekend: what does a land value tax do to parking?
In the long run, of course, it’s going to push for more productive developments than a flat slab of asphalt. I’m interested in the short run. Whoever owns the lot loses their subsidy, raises parking prices accordingly, and/or sells to someone with the capital for an improvement. A business which currently relies on the cheap lot down the street is not likely to enjoy that process. I suspect a lot of small American operations rely on such setups. Does this give them a reason to oppose LVT?
Raising parking prices is not an option, you can't get as much from surface parking as the owner of the skyscraper next door gets from its tenants.
In the short term, these small operations will have to dedicate some parking spaces to its customers or rebuild the buildings into something that has parking downstairs and commercial space upstairs.
Even in smaller towns? There should be a marginal plot where the land is currently undervalued, but not by enough to justify a rebuild. Maybe those situations are rare?
I think there’s a coordination problem here where some businesses really benefit from subsidized parking. It’s still a distortion, but that’s the kind of distortion which breeds opposition to a reform.
I was thinking about downtown parking. If you have a parking lot right across the street from a building, their LVT should be practically identical.
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