GLOSSARY

Fees in Lieu (Parking)

A fee in lieu of parking is a payment a developer makes to a city instead of providing some or all of the parking that zoning would otherwise require on site.

FEES IN LIEU: MANY SMALL SITES FUND ONE SHARED GARAGE (SCHEMATIC)sitesitesitesitesitePublic fundfee per spaceSHARED GARAGEor transit and mobility
Instead of each small lot building its own parking, developers pay a fee per required space into a public fund, which builds shared parking or other access improvements where they serve the whole district. Schematic.

The city pools the fees and spends them on shared public parking, transit, walking and cycling improvements, or other ways of meeting access needs. Fees in lieu are most common in downtowns and main streets, where small lots make on-site parking impractical and shared garages use land more efficiently. See parking minimums.

How they work

  • The fee is usually set per space not built, sometimes tied to the cost of a structured space.
  • Payment may be one time or spread over years.
  • The funds are typically restricted to parking or mobility uses in the same district.

Trade-offs

  • They free small sites from building inefficient parking, which helps infill and historic buildings.
  • A fee set too high works like a minimum requirement; one set too low may not fund enough shared capacity.
  • Where cities have removed minimums altogether, fees in lieu matter less. See AB 2097 and parking maximums.

The Parkonomics view

A fee in lieu is a step toward treating parking as shared infrastructure instead of a private obligation on every lot. It works best paired with a district plan that says what the money will build and where.

Related terms: Parking Minimums, Shared Parking, Parking Benefit District, Parking Maximums, Unbundled Parking, Parking Ordinances