California Air Resources Board

I. Objective

This contract aims to support the implementation of California’s Parking Cash Out (PCO) law in three ways. First, it will assess the PCO program from employer and employee perspectives to learn about current perceptions and challenges. Second, it will conduct a costs and benefits analysis, including the impacts on vehicle miles traveled (VMT), criteria pollutants, and greenhouse gas (GHG) emissions in California to raise awareness and promote a quick understanding of the program. As part of this study, researchers will assess how the PCO program affects low-income and environmental justice groups, which should be considered in the guidance document for employers. Finally, this study will develop comprehensive guidance and materials to support employers in adopting and implementing a PCO program.

II. Background

VMT significantly affects various aspects of society, the environment, and public health, including contributing to traffic congestion, exacerbating social inequities by limiting access to transportation options for low-income communities, increasing the risk of chronic diseases, and so on. Reducing VMT is also necessary to meet California's air quality standards and climate goals. These issues can be addressed through a combination of changing development patterns (promoting higher density, mixed-use development), transportation choices (encouraging alternative modes and active transportation), and behavioral changes (raising awareness and shifting cultural norms) to wean out from car dependence and help support sustainable transportation practices. A PCO program is one mechanism among others to achieve this goal by incentivizing employees to use alternative transportation modes such as public transit, carpooling, biking, walking, or telecommuting instead of driving alone.

To shift the set of incentives that influences travel decisions and encourage employees to use non-auto methods for traveling to work, California requires certain employers in nonattainment areas that have 50 or more employees and provide parking subsidies to employees to also give employees the option to “cash out” the parking subsidy in lieu of a parking space. In 2022, AB 2206 (Lee) amended the PCO law to clarify how to calculate parking subsidies and the type of information employers must maintain as a record of communication with the employee as part of the PCO program. A limited studies12 show that offering cash allowances instead of parking subsidies encourages employees to find alternate means of commuting to work, such as public transit, carpooling, vanpooling, bicycling, or walking. This improves air quality and reduces traffic congestion by reducing vehicle trips and emissions.

Though the PCO program has many potential benefits, some employers have expressed challenges in implementing and managing a PCO program. For example, PCO programs can be administratively complex, requiring resources for program design, communication, and monitoring. Additionally, determining fair and equitable cash incentives for employees can be challenging, especially in heterogeneous workforces with varying commuting distances and transportation needs. Further, the effectiveness of PCO programs may depend heavily on contextual factors such as geographic location, transportation infrastructure, workforce demographics, and employer culture. Success for one organization or in one region may not necessarily translate to success for another.

In the recent past, the pandemic has changed commuting patterns in California. With the widespread adoption of remote work during the pandemic, many employees no longer need to commute to the office regularly. This shift reduced the demand for parking spaces, leading some employers to reassess their PCO programs.3  Further, in more densely developed areas, a decrease in commuting might have led to a surplus of parking spaces,4  which could affect the perceived value or cost of parking. Similarly, employees' commuting preferences have changed, with some indications that people are opting for private vehicles to avoid public transportation.5  These changes could influence the effectiveness and relevance of the PCO program.

In light of these considerations, CARB would like to assess the perspectives of employers and employees about the PCO program. Then, CARB would like to evaluate the costs and benefits of the PCO law with regard to VMT, criteria pollutants, GHG emissions, and equity in order to provide a comprehensive understanding of the PCO law’s impact and potential for further improvement in California.

III. Scope of Work

The proposed study assesses the PCO program's effectiveness at a program level and provides guidance on how to implement it at the employer level. To conduct this study, researchers should obtain quantitative data and qualitative insights from employers and employees to understand their experiences, perceptions, and attitudes toward the PCO program. Then, they should use this information to estimate the costs and benefits of the whole program. The findings from this study will help provide a greater understanding of the PCO program, enable employers to implement it more effectively, and update the CARB guidance document.

Specifically, the proposed study will be designed to answer the following questions regarding PCO:

1. What are employers’ perspectives and employees’ preferences:​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​
   • What are the participation rates for employers implementing the PCO program?
   • What are employers' motivations for participating in the PCO program?
   • What challenges do employers face in implementing and managing the program within their organizations?
   • How do employees perceive the program's incentives and benefits, including their effectiveness in influencing transportation choices?
   • Are there any barriers or challenges hindering employees' participation or awareness?
2. ​​​​​​​What are the costs and benefits of the PCO program at a statewide level:
   • ​​​​​​​What are the costs associated with implementing and administering the program from an employer's perspective?
   • What are the program's environmental benefits in terms of reducing GHG emissions, criteria pollutants, and VMT?
   • To what extent has the program contributed to mode shifts among employees, such as increased use of public transit, biking, walking, or carpooling?
3. ​​​​​​​What are the equity aspects of the PCO program at a statewide level:
   • ​​​​​​​Is the program equitable for employees across different socioeconomic backgrounds and geographic locations?
   • Are there any program participation or benefits disparities based on factors such as income, race, or job location?

​​​​​​​​​​​​Task 1 - Literature Review

The purpose of this task is to review prior research, empirical studies, and existing experiences related to the PCO program with the goal of understanding the program's current status. Specifically, the research team should document the best practices and challenges of implementing the PCO program—the incentive structures, administrative requirements, and critical success factors for participating employers and employees. Further, the team should document the existing methods and variables used to estimate the costs and benefits of the program. In addition, the literature review should report the potential effects of PCO programs on transportation behavior, commuting patterns, parking demand, and mode shift. The literature review should also serve as the foundation for the subsequent tasks in the project, including informing the quantitative and qualitative data collection approach of the PCO program.

Deliverables:

• A report summarizing the PCO program's current status, including potential effects, best practices, and implementation challenges. This report should also document existing quantification methods to estimate the costs and benefits of the program.

​​​​​​​Task 2 - Identify study participants selection criteria, data collection approach, and quantification methods

The success of this research depends on identifying a diverse and representative group of employers and employees who participate in the PCO program to take part in the quantitative and qualitative data collection. Hence, researchers should develop selection criteria to strive for a mix of participants to gather insights from different viewpoints and experiences. This could include (but is not limited to) criteria such as geographic location (e.g., urban, suburban, and rural), business type and composition (e.g., small businesses, mid-sized companies, large corporations), program duration, employee commuting modes (drive alone, carpooling, public transit, walking, biking, and telecommuting), and industry diversity (e.g., public and private sector). In addition, participating employees should be from diverse sociodemographic backgrounds, including age, gender, ethnicity, race, income level, education level, and job role.

In addition, the research team should identify a data collection approach to gather firsthand insights about the PCO program from employers and employees. This could be based on interviews, focus group discussions, surveys, document analysis, case studies, or other techniques. Further, in this task, researchers should identify the quantification methods for estimating the costs and benefits of the PCO program. In this task, researchers should finalize the list of selection criteria, data collection approach, and quantification method in consultation with CARB staff.

Deliverables:

• A report includes a list of selection criteria and recruiting methods to identify employers and employees for data collection, as well as the type of information that will be gathered from the employers and employees in this study. In addition, describe the quantification method that will be used in Task 4.

Task 3 - Select participants for data collection and analyze the responses

This task aims to select the employers and employees for data collection using the criteria established in Task 2. Using the identified data collection approach, researchers should collect information related to participation rate, program implementation strategies, travel behavior changes, program effectiveness, barriers, best practices, and future plans. In addition, this task should be used to gather a comprehensive data set from employers necessary for costs and benefits analysis and quantifying the impact of PCO on VMT, criteria pollutants, GHG, and equity. For example, it could include administrative expenses, staffing, number of days employee commute, commuting distance, mode, etc.

As part of this task, the research team should synthesize the most salient and significant findings from the responses that address the research objectives and questions. Researchers should organize the data systematically, grouping responses by employers and employees, question types, or thematic categories. They should also highlight key insights, observations, and quotations that illustrate essential themes or illuminate specific points. Finally, researchers should offer actionable insights for better implementation of PCO from an employer standpoint based on analyzing collected data/responses and identifying implications for practice, policy, and further research. Some of this information would be included in the engaging animations or graphics, and examples of success stories would be showcased in webinars.

Deliverables:

• A report with a number of employers and employees selected for data collection and their backgrounds. Also, researchers should summarize the data collection process and distill complex qualitative data into meaningful insights and actionable recommendations for better implementation of PCO from an employer perspective.

​​​​​​​​​​​​​​Task 4 - Quantifying PCO impacts and equity analysis

This task should quantify the costs and benefits associated with the PCO program statewide. As part of this task, the research team should estimate the impact of the PCO program on VMT, criteria pollutants, and GHG emissions using data collected in Task 3. Also, in this task, researchers are asked to assess how the program contributes to state and local environmental goals and targets, such as air quality improvement and climate change mitigation.

In addition, the research team should conduct an equity analysis of the PCO program, which involves assessing how the program impacts different sociodemographic groups by gathering data on the socioeconomic characteristics (income, employment status, education level), geographic location (urban vs. rural, neighborhood characteristics), race, ethnicity, and accessibility needs of program participants, including employers and employees enrolled in the PCO program. Further, researchers should analyze the demographic data to identify any disparities or inequities in participation rates, program benefits, and outcomes across environmental justice and low-income populations. Findings from this task would be used in the CARB implementation guide and other regulatory documents.

Deliverables:

• A report that includes the estimated costs and benefits associated with the PCO program statewide; a quantitative estimate of the PCO program’s impacts on VMT, criteria pollutants, and GHG emissions as compared toward achieving state and local environmental goals and targets; and a qualitative and quantitative analysis of equity impacts of the PCO program.

Task 5 - Develop guidance for PCO implementation

The purpose of this task is to develop guidance for employers in implementing a PCO program– a comprehensive framework that outlines the steps, strategies, and best practices for employers interested in adopting and implementing a PCO program – based on Tasks 1-4. Researchers should break down each implementation step into actionable tasks and responsible parties. In addition, this contract involves the creation of sample communication materials, such as email templates, posters, and FAQs, to support employer outreach efforts. These materials should be based on the insights gained from earlier tasks about the communication needs of employers and the perceptions of employees. Further, these materials should be visually appealing, informative, and easy to understand. In addition, researchers should recommend incentive structures and strategies to motivate employee participation in the PCO program, which might include a mix of financial incentives (e.g., cash payments, transportation subsidies), non-financial incentives (e.g., recognition programs), and/or flexibility options (e.g., telecommuting, flexible work hours). Also, researchers should provide recommendations to advance equity in implementing the PCO program. Further, the guidance document should outline methods for agencies to evaluate and monitor the effectiveness of the PCO program, including key performance indicators, data collection strategies, and evaluation timelines.

Deliverables:

• Provide comprehensive guidance for PCO program implementation that empowers employers to create effective, equitable, and sustainable transportation solutions for their workforce. This report should also include recommendations for better incorporating equity into PCO implementation, including metrics to track equity within PCO. Moreover, this guidance should include various types of graphic design and engagement materials that employers can utilize to promote the PCO program.

IV. Deliverables

The project pre-proposal must include but is not limited to the following deliverables:

During Active Contract Period

• Work with CARB staff at the beginning of the project to create a 1-page plain-language outreach deliverable for the public describing the project’s goals, process, and planned deliverables (available in multiple languages, template will be provided).
• Quarterly Progress Reports, including public-facing updates, are to be posted on CARB’s website.
• Quarterly Progress Meetings
• Informal monthly progress update meetings with the CARB contract manager (if applicable).

​​​​​​​Prior to Contract Close

• A report provides an in-depth analysis of findings from the literature review about the PCO program, including quantification methods to estimate the impacts, best practices, and implementation challenges.
• A report describing the process used to select the employers and employees participating in this project. This should include selection criteria, data collection approach, and a detailed analysis of the responses received condensed into an easily understandable data sheet highlighting key findings. Also, any lessons learned in this process for future studies.
• A report includes costs and benefits analysis associated with the PCO program from the perspective of employers and employees. Also, a qualitative and quantitative analysis of equity impacts on the PCO program should be included.
• A comprehensive report with guidance for employers to successfully implement the PCO program and metrics to track the progress. Further, this report should include templates and graphic design materials to promote the PCO program.

NOTE: contractor will be responsible for ensuring their documents comply with the American with Disabilities Act.

Additional deliverables to be determined in consultation with CARB staff.

V. Timeline

It is anticipated this project will be completed in 24 months from the start date (start date is estimated to be in Spring 2025). The estimated budget for this project is up to $300,000.

Scoring Criteria

1. RESPONSIVENESS TO THE GOALS AND OBJECTIVES OUTLINED IN THE PROPOSAL SOLICITATION (20 POINTS)

The proposal should explain—in adequate detail and clear, understandable language—how the proposed project satisfies the project objectives.

2. WORK EXPERIENCE AND SUBJECT MATTER EXPERTISE (20 POINTS)

The proposal should demonstrate that the proposers have the work experience or subject matter expertise required to successfully carry out the proposed project as described. Additionally, the proposal should describe how the project will build upon previous relevant work that was funded by CARB, other regional, state, and federal agencies.

3. EXPANDING EXPERTISE (10 POINTS)

The proposal should explain how the project team expands expertise such as by incorporating multidisciplinary expertise or perspectives, including members from various public universities, non-academic institutions, or community-based organizations, or providing opportunities to build skills and expertise for individuals from underrepresented groups. Reviewers will consider if key personnel contributing significantly to the project (i.e., a principal investigator, co-principal investigator or co-investigator, contributing 25 percent or more of their time to the project) have not worked with CARB in the past five years.

4. EXPLANATION OF TECHNICAL OR METHODOLOGICAL APPROACH (20 POINTS)

The proposal should clearly explain the logic and feasibility of the project’s methodology, spell out the sequence and relationships of major tasks, and explain methods for performing the work. The proposal should include a clear description and plan for how each task will be completed.

5. LEVEL AND QUALITY OF EFFORT AND COST EFFECTIVENESS (15 POINTS)

The proposal should describe how time and resources will be allocated and demonstrate how this allocation ensures the project’s success. Proposal reviewers will evaluate, for example: if the objectives of the project can be met given this allocation, if there is adequate supervision and oversight to ensure that the project will remain on schedule, if time and cost are appropriately divvied up across different project tasks and stages.

• 1Shoup, D. C. (1997). Evaluating the effects of parking cash out: eight case studies.
• 2Abou-Zeid, G., Grant, M., Heinrich, S., & Shah, D. (2023). An Assessment of the Expected Impacts of City-Level Parking Cash Out and Commuter Benefits Ordinances (No. FHWA-HOP-23-023).
• 3Based on the communication with the City of Santa Monica and South Coast Air Quality Management District Staff.
• 4Waters, M. (2024, February 9). Will COVID-19 change the parking business?. The Hustle. https://thehustle.co/covid-19-business-of-parking-lots.
• 5Das, S., Boruah, A., Banerjee, A., Raoniar, R., Nama, S., & Maurya, A. K. (2021). Impact of COVID-19: A radical modal shift from public to private transport mode. Transport Policy, 109, 1-11.