Parking and Delta Credits -or- Why Old, Decrepit Buildings in Dallas Stay that Way
2/2/2018 Update: I’ve added a practical guide at the end on how to get your very own Determination Letter so you too can cling to your precious delta credits.
Note: Beware of relying on some guy in a blog for your land-use or building code advice. Consult the codes yourself or use one of the innumerable consultants to verify.
There is a category of funny things that subtly shape everyday life while never calling attention to themselves. Sometimes we notice these things. For instance, after a trip to Europe, it’s not uncommon to hear something like “One thing I missed about the USA is free bathrooms.” This is said, perfectly naturally, without delving into the difference between choices we make as a society and choices made for us.
Parking is one of these funny things. In Dallas, like most US cities, we expect our parking to be free and plentiful. The few parking meters & irksome valet stands and the outrage we feel at the price of parking at the Arboretum serve only to remind us all the more that free parking is almost never hard to find.
There is a reason for this. Nearly every city in America went through the following chain of events as automobile ownership became widespread:
Demand for parking increased — -> All nearby free parking were occupied — ->Spillover parking in front of neighboring homes and businesses →Upset neighbors (and hence politicians) — ->Laws mandating that landlords provide a minimum number of free off-street parking spaces to “Make sure this never happens again”. We shall see how this (superficially rational) cure is worse than the malady and in fact has been a prime contributor to the insolvency of our city.
There is an incredibly elaborate methodology that has grown up to help “Make sure this never happens again”. I won’t go into the absolutely inane methods of calculating parking demand or trip creation or how transportation engineers, politicians, and planners pretend to have a good handle on the concept. Donald Shoup covers this thoroughly in his seminal work on the subject “The High Cost of Free Parking” (an essential, though lengthy, read). Suffice to say that every building has a minimum required number of off-street parking spaces that must be provided free of charge to residents or patrons.
Dallas isn’t the worst offender in the country on parking regulations: Some cities have higher minimums. Others require developers to always round up to the next space when calculating minimums. Even worse, a few cities require a developer who removes any parking (e.g. if a parking lot is replaced with a building) to not only provide the new required parking, but to also replace the spaces eliminated by the new development (treating parking like rain forests insomuch as active preservation efforts are needed.)
Still, Dallas is seriously lacking a progressive approach to…well almost everything but parking in this case. While cities like Portland, OR and Buffalo, NY have reduced or even eliminated parking requirements, Dallas lacks even “in-lieu” fees for parking spaces not provided.
How Parking Requirements Work in Dallas
Parking in Dallas is governed by the massive Dallas Development Code contained in Chapter 51A of the City code (referred to hereafter as “51A”). I own print copy of 51A, purchased in my initial (over)excitement on becoming a real estate developer. It’s satisfying to hold the real thing, but you can also access it quite easily online at http://www.amlegal.com/codes/client/dallas_tx/
Without going into too much detail (you can look up specific uses yourself) this is how it works:
If you’re building something new, you have to provide the parking required in the use regulations. These are stated in a “1 space per X square feet of floor area.” These range from 1 space per 1,000 sqft for some industrial uses (not so bad) to 1 space per 25 sqft (!) for Dance Halls which leads to parking oceans around places like the It’ll Do Club which is open just 4 hours once a week (oh, but what a 4 hours that is).
You might look at me and say: “But Nathaniel! I’ve seen PLENTY of buildings that don’t provide anywhere close to this much parking. In fact, i’ll have you know that some parking-hating-landlords have buildings with no provided parking whatsoever!”
This is true and there are number of limited exceptions to this general rule:
-Zoning in some areas (like the CBD) requires no parking
-Some Planned Developments (PDs) have relaxed parking requirements
-The owner got a special exception or administrative reduction to knock off a little parking (see Sec. 51A-4.311 and 4.313)
-Some sort of remote parking arrangement is in place (i.e. there’s parking, but it’s not on the same site as the building)
-The building is zoned under Dallas’ laughable-but-headed-in-the-right-direction form-based code in Article XIII of the development code
The building has some Delta Credits which are more precious than gold and where this whole parking discussion really goes off the rails.
Delta Credits and the Death of Neighborhoods
Delta Credits are something of a sore subject in Dallas. Landlords hoard them, neighbors resent them, and the City scarcely acknowledges their existence except to take them away whenever it can.
Delta Credits are an acknowledgement that somewhere back in the mists of time (before the angry neighbors demanded politicians keep people from parking in front of their houses or businesses), people could make their own decisions about how much parking to provide and some chose to provide little or none at all. To suddenly require all of these existing buildings to conform to the new rules would drive thousands of people from their homes and shutter countless businesses as the costs to comply would either be too high or nearby buildings would be demolished to make way for the newly mandated resting places for automobiles not in use.
Here is the relevant code section on Deltas from 51A-4.704(b)(4)A-B:
“Increased requirements. A person shall not change a use that is nonconforming as to parking or loading to another use requiring more off-street parking or loading unless the additional required off-street parking and loading spaces are provided.
Delta theory. In calculating required off-street parking or loading, the number of nonconforming parking or loading spaces for a use may be carried forward when the use is converted or expanded. Nonconforming rights as to parking or loading are defined in the following manner:
Required parking or loading for existing use — Number of existing parking or loading spaces for existing use”
The formula in almost plain English: Parking you SHOULD have under current regulations — Parking you provided under past regulations = # of Delta Credits.
Let’s say you buy a building with a restaurant of 1,000 square feet that, God help us, has no provided parking. Regulations say you SHOULD have 10 spaces, but you have 0 so by this theory you have 10 delta credits.
Thus 1 Delta Credit equals 1 parking space you don’t have to provide under current rules. Per section A, enlarging your building requires you to provide the additional spaces, so you can’t expand your restaurant or change to a Dance Hall with its higher required parking needs, without providing these spaces.
Delta Credit Death Spiral
Simple right? It is, unless you change anything, ever. This is where the City of Dallas starts coveting your Delta Credits.
The next section (C) reads:
“Decreased requirements. When a use is converted to a new use having a lesser parking or loading requirement, the rights to any portion of the nonconforming parking or loading that are not needed to meet the new requirements are lost.”
Let’s say you replace your dine-in restaurant tenant and get a new tenant, a caterer. This use requires parking at 1 per 200 sqft, meaning you should have 5 spaces. We have 10 delta credits, so no problem, for now. Let’s say your caterer is a big success and wants to start dine-in service. No problem we have 10 delta credits right? Wrong! You foolishly lost them when you went to a use with fewer parking requirements and section A says you have to provide the parking now.
The practical effect of this regulation is that in hot areas, developers beg for the city to build them a free parking garage so they can expand. The real tragedy though is in the older marginal areas of Dallas (i.e those not currently swept up in the tides of TIF fueled gentrification).
Less intense (and hence less valuable) uses generally have lower parking requirements. When a neighborhood takes a turn for the worse and the old pharmacy (1 space per 200 sqft) becomes an auto repair shop (1 space per 500 sqft) it has entered a deadly spiral: it can’t get higher-value tenants because it can’t provide the parking (having forfeited the delta credits it had for the drug store) and it can’t afford to offer more parking because it can’t attract better tenants. Only through a tremendous expenditure of funds to buy, lease, or build parking facilities (maybe demolishing another building that could otherwise be saved) is the landlord able to bring in a more valuable tenant, even though that type of tenant may have been there previously.
Killing Our Neighborhoods one Parking Lot at a Time
Thus our City has chained a millstone to the necks of our marginal neighborhoods: first by making it difficult to adapt existing properties to new uses and second in committing valuable land to low-value parking uses.
This is why the decay of what should be our finest and most desirable neighborhoods has become so widespread that we cannot even maintain our existing streets or pay our police force, let alone think of such niceties as new parks or flood control.
Trading valuable buildings for low-value parking lot comes at a cost. Our police take hours to respond to 911 calls and we drive down pitted roads because our taxes don’t bring in enough money to cover services. Think about what we’ve given up as a City just to have a free & convenient parking space for every motorist at every destination.
Next time: Further secrets of the mysterious Delta Credits and 2 (low-cost!) proposed solutions that cut the gordion knot we have tied above.
How to Get the City of Dallas to Acknowledge your Delta Credits
Not only does the City covet your Delta Credits, they have also left the staff nearly completely untrained on their existence. Any attempt to bring up delta credits with low-level staff will get you a look of absolute look of contempt and a request for proof of their existence (despite the fact that delta credits are lost, not gained). Fortunately, there is a way to get proof of their existence!
In typical fashion, the steps on how to get proof are not written down anywhere and an exhaustive search of the City’s websites and city code will yield you nothing at first glance. However, tucked away in the little-referenced Chapter 52 is the following passage.
303.5.24 Fee for determination letter A fee of $100 must be paid for a letter confirming the findings of the building official on a specific inquiry.
A determination letter is a request that the building officials do their best to research an issue and give an official response. To get this rolling you’ll need:
- Every Certificate of Occupancy ever issued by the City (available in the records in the Oak Cliff Municipal Center)
- A scaled and dimensioned site plan on minimum 11x17 paper
- Your calculation of required parking, providing parking, and delta credits
- A written letter to the building official (Usually the Chief Planner) detailing your request
Take this on down to the Oak Cliff Municipal Center and hand it over to the Chief Planner (make an appointment) and get ready to wait.
A few things to note:
- It will take a long time. Mine took about a month and prodding from my Council Member.
- It will probably be wrong. The first letter I got from the City said I had -0- delta credits since I had a lot zoned for parking (even though no parking lot had ever been built). Fortunately, the rules don’t say zoned for parking, the law says spaces actually provided, so they relented
- It will be painful. I initially calculated that I would have 31 delta credits. The City disagreed and gave me 23 because they claim the building was converted to a warehouse for 10 months back in the 1980s and warehouses have a much lower parking requirement so I lost 8 delta credits (unfortunately for me, the City didn’t have a Copy of the CO that show this, only an entry in their archaic CO record system dating from the year they converted the system. I suspect it is a clerical error, but I was too naive then to push back).
Be aggressive but reasonable and fact-based, don’t give them any ground, and make them prove their points based on the law. City Staff is not able to give you favors and most of them deal with whiny people all day, so don’t expect any breaks.
After a few months and shelling out $100, hopefully you end up with one of these:
Good luck!
