Bill to Facilitate “Cashing Out” on True Cost of Parking Passes Transportation Committee

For immediate release:

Today, AB 2206 to facilitate the enforcement of California’s Parking Cash-Out (PCO) program by requiring the unbundling of parking in commercial leases, passed out of the Transportation Committee. The PCO Program was enacted three decades ago in 1992 (AB 2109, Katz), and aims 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 program requires certain employers with more than 50 employees to offer an equal benefit to employees who do not drive to work and are unable to utilize free parking provided by the employer. However, because many owners of commercial real estate “bundle” the cost of parking with the cost of an office space into a single lease price, it has been difficult for employers to separate the cost of parking spaces associated with the commercial space.

In order to facilitate compliance with existing law and achieve PCO’s traffic congestion and air pollution benefits, AB 2206 requires parking owners to provide employers subject to PCO with unbundled parking costs.

“In a society dominated by cars, this program creates more equity and reduces greenhouse gas emissions,” said Assemblymember Lee. “Our bill makes the program easier to implement so those who don’t drive are also able to get the full benefits of the program.”

The City of Santa Monica is one of the few jurisdictions in California with a more successful PCO program. The City passed its own unbundled parking provisions to make it easier to implement the PCO program and noted that the unbundling of parking has been a useful tool in its implementation. 

PCO applies to public or private employers who meet all of the following:

  • Employ at least 50 people
  • Have worksites in an air basin designated nonattainment for any state air quality standard
  • Subsidize employee parking that they don’t own
  • Can calculate the out-of-pocket expense of the parking subsidies they provide
  • Can reduce the number of parking spaces without penalty in any lease agreement