Officials Recommend Raising ‘Fee-in-Lieu’ Parking Rates for Commercial Projects Downtown

Saying New Canaan’s rates lag other towns and haven’t been upped in years, officials are recommending that the town raise its fees for those seeking to pay money into a parking fund in lieu of providing the required number of spaces for commercial construction projects.

A committee of the Planning & Zoning Commission proposed at its most recent meeting that the baseline fee for the first “fee-in-lieu” space go up from $17,500 to $20,000, with increases in other categories to follow.

“We have seen some resistance at $17,500 but I think it would not seem unreasonable to me to bump it a little bit this year,” Jean Grzelecki of the Plan of Conservation & Development Implementation Committee said at the group’s most recent meeting, held Nov. 28 at Town Hall.

Going to $20,000 “seems pretty reasonable,” she said.

The New Canaan Zoning Regulations (see page 121) lay out the minimum number of parking spaces (and loading spaces) required for businesses, and that figure is tied to type and intensity of use—for example, a bank must have one space per 200 square feet of floor area on the street-level floor (or closest to it), while a nursing home must have one space per five beds and at least one space per two employees.

P&Z by special permit may reduce that required parking by up to 40 percent, depending on the specific zone, or by a two-thirds vote may allow for a permanent reduction if an applicant pays a certain amount of money. Monies collected through the “fee-in-lieu” of required parking spaces—allowed under state law—are to go toward a fund used for acquiring, developing, expanding or repairing parking facilities, under the regulations.

In New Canaan, as the regulations now are written, an applicant pays $17,500 for one space, which may be reduced to $15,000 or $12,500 if the attendant project achieves certain environmental certification ratings. Additional fee-in-lieu spaces cost $10,000 per space, under the town’s zoning regulations, and that rate also applies when someone changes the use of a commercial property so that it now is subject to a higher parking requirement.

The regulations require that P&Z prior to granting a fee-in-lieu permit must be assured that the parking spaces that would be required cannot be located on the land in question and that removing the requirement “will not detract from the village feel and quality of life in the downtown.”

New Canaan’s off-street parking authority, the Parking Commission, long has said that the fee-in-lieu system is detrimental to the town.

In its recent annual report, the commission said that fee-in-lieu “virtually gives away substantial value in required off-street parking to private interests.”

“The program should be abandoned or the rates raised to $45,000 per waived parking space—note that $45,000 reflects the estimated cost of the Locust Lot tiering ($4 million) over the incremental parking spaces (roughly 89), plus it is consistent with the ‘MTC Smart Growth Technical Assistance: Parking Structure Technical Report’ prepared for the San Francisco Bay Area in June 2012 which prices each parking space at $45,000 for documentation of this value,” the commission said in its report.

It continues: “If the fee-in-lieu of parking program is retained, we recommend that the Planning and Zoning Commission prepare and present an annual public report on the number of required parking spaces that they have waived without compensation or in exchange for a contribution to the Parking Fund.”

Right now, that fund stands at about $525,000, Grzelecki said, thanks mainly to a major contribution from Stamford Hospital when it opened medical group offices on Grove Street.

The committee is also recommending that P&Z raise the lowest fee for those with LEED Gold Certification from $12,500 to $15,000, and to raise both the additional parking space (after the first) and “change of use” fee-in-lieu rate to the same number.

Grzelecki warned that “if this [re-assessing fees] is something we do annually, then the bumps have to be reasonable.”

Cristina A. Ross, a guest at the meeting, suggested that the commission review its fee-in-lieu rate structure annually “so when you pay for parking it is not ‘in perpetuity,’ which is the way it is now.”

Grzelecki asked interim Town Planner Keisha Fink to find out what other towns do regarding review of fee-in-lieu rates.

The full P&Z Commission has yet to take up the recommendations.

3 thoughts on “Officials Recommend Raising ‘Fee-in-Lieu’ Parking Rates for Commercial Projects Downtown

  1. Municipal Best Practices require that towns set up and maintain annual reviews of what their benchmark peers are doing across a wide range of issues…issues such as parking fees, parking availability and parking fee-in-lieu. It also calls for a meeting of the minds between multiple authorities, for example the Parking Commission and Planning and Zoning, to develop a comprehensive and unified policy position on all overlapping issues.

    • There is no justification for the Town subsidizing commercial development in the business district. The Parking Commission’s November 15th report to the Selectmen and the P&Z suggesting a $45,000 fee refecting the cost to the Town was completely ignored by the committee.
      All town fees should be reviewed annually by the Selectmen as required by town ordinances and that review should include P&Z fees but they are never reviewed.

  2. Thank you Michael for raising these points. Disclosure I’m a member of the NC parking commission. There are a few additional points that I would like to add to the discussion.
    The fee-in-lieu is a good policy if it is reviewed and enforced holistically with town planners and the fees are used as intended. Not all buildings or sites lend themselves to the parking volume required by zoning. We don’t want our charming walkable town to look like route 1 strip malls on account of parking requirements. Certain sites are better suited to storefronts with parking centralized elsewhere or a reduced parking footprint.
    I don’t speak for the entire Parking commission but my comments were made in the context of fee enforcement and municipal parking construction action. As at times those fees are used as a negotiation chip and eroded when the final approval is set and the town hasn’t used the funds to acquire property recently.
    The parking commission regularly reviews other town parking fees (we have comparable if not lower). I agree that the town planner should be benchmarking our fees against similar municipalities (we are not San Francisco) to recommend fees and guidance of exceptions for LEED or other circumstances.

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