Car Sharing: Overview and Zoning

CAMBRIDGE CITY COUNCIL Craig A. Kelley City Councillor CITY HALL, CAMBRIDGE, MASSACHUSETTS 02139 [phone removed] FAX: [phone removed] TTY/TDD: [phone removed] EMAIL: ckelley@cambridgema.gov To: Donna Lopez, City Clerk From: Craig A. Kelley, City Councillor; Mark Gutierrez, Council Aide Date: April 26, 2018 Subject: Memorandum Submission Please place the attached Car Sharing: Overview and Zoning Memorandum on the City Council agenda for the April 30, 2018 meeting. Thank you.

CAMBRIDGE CITY COUNCIL Craig A. Kelley City Councillor CITY HALL, CAMBRIDGE, MASSACHUSETTS 02139 [phone removed] FAX: [phone removed] TTY/TDD: [phone removed] EMAIL: ckelley@cambridgema.gov MEMORANDUM To: Cambridge City Council From: Craig A. Kelley, City Councillor; Mark Gutierrez, Council Aide Date: April 30, 2018 Subject: Car Sharing: Overview and Zoning 1. Introduction The sharing economy is growing at a very fast rate and transportation is no exception. Industries and sectors have been newly created in the past two decades, with rapid iteration and acceleration in the near future. Self-driving cars, micro-transit (micro-mobility) and the Hyperloop, among others, are on the horizon. It’s important to be proactive in the creation of and participation in these emerging technologies. With the intent of furthering discussions about how Cambridge can effectively regulate and embrace new or expanding methods of car sharing, this memo explores car sharing issues, how it is affecting the world, and how communities are reacting to this innovation in personally owned vehicle transit. 2. What Is Car Sharing and How Does It Work? Car sharing is a term used to describe the relatively new industry of car rental in which a member rents a shared vehicle, typically for fairly short periods of time and distances. Car sharing may also be distinguished by: • Mitigated environmental impacts • Contribution to a consumer multi-modal transportation network • High-level use of technology

2 • Membership participation (includes gas, insurance, and limited mileage) • Dispersed vehicle locations, as opposed to a hub • Self-service 24/7/365 availability Car Share Operator (CSO) Categories • Business-to-consumer (B2C)- For-profit and non-profit companies own a fleet of vehicles and rent them to members. • Business-to-business (B2B)- Companies sell or rent their technology to businesses and municipalities to turn private fleets into private car share. • Peer-to-peer (P2P)- Individual car owners rent their personal vehicles to members. CSO Business Models • Round-trip (traditional car share)- Reservations are made in advance and require the same pick-up and drop-off location (in a dedicated parking space in a lot, garage, or on- street), and a start and end time. o Use cases: grocery store runs, shopping, doctor’s appointments, meetings, and day/weekend trips. • One-way (station-based)- Reservations are made “on-demand” and allow for separate pick-up and drop-off locations (in a dedicated parking space in a lot, garage, or on-street) with an end time not required. o Use cases: commuting to work, nightlife events with intent to taxi home safely, bridging transportation gaps, last-mile transportation. • Floating (flexible)- Reservations are made “on-demand” and are picked up wherever they’re available, typically on streets and in open lots, and dropped off in any legal parking space. o Use cases: commuting to work, nightlife events with intent to taxi home safely, bridging transportation gaps, last-mile transportation. Operations Most CSO’s define their footprint based on a number of factors including member base, existing transportation market, and population and demographic information. Strong partnerships are established to obtain parking with parking management companies, public transportation authorities, universities, property management companies, and municipalities.

3 Figure 1 3. What Are the Organizations? • Zipcar- Considered the world’s leading car share company and founded here in Cambridge, Zipcar jump started the American car share revolution. Owned by Avis Budget Group, they operate B2C round-trip/one-way models and B2C fleet share tech. • Enterprise CarShare- Operates B2C in over a dozen U.S. markets, Enterprise’s car share branch offers round-trip reservations for members. • Maven- Owned by General Motors, recently pushed into over a dozen U.S. markets with B2C round-trip reservations. • Car2Go- Owned by Daimler AG and considered the leader in the B2C flexible model, Car2Go brought a new type of car share offering to people looking for flexible pick-up and drop-off locations and times. • GetAround- Operating a similar model to Airbnb, GetAround is a P2P car share company that allows car owners to rent out their personal vehicles to a network of members. • Turo- Formerly RelayRides, Turo is the other major P2P car share company that connects car owners to a network of renters.

4 Figure 2: Zipcar at Logan Airport Figure 3: Start-Up Bonzer Car Share Figure 4: Zipcar Electric Vehicles in Garages Figure 5: Turo P2P Rental

5 4. Why Is It Important? Car sharing provides many benefits. Individuals are optioned with a car ownership alternative and can enjoy a care-free transportation option, allowing one not to worry about maintenance, car payments, insurance, parking, and expenses. Car owners that need or prefer to have a car may opt to downsize their personal car(s), as car share can provide secondary or supplemental vehicles like vans for moving, trucks for hauling, and SUVs for larger passenger or load capacity. Cities enjoy reduced traffic and congestion, reduced wear and tear on roads, increased urban mobility flow, a tighter transportation network, more available parking spaces, and cleaner air. The environment is benefited as car sharing reduces the number of vehicles on the road, encourages walking, biking, and public transportation, and typically uses newer and more environmentally- friendly vehicles in their fleets. Many estimates claim that car sharing takes 5 to 15 personally owned vehicles off the road, weighted toward the latter, providing residents and visitors with more parking. Additionally, cars sit unused by their owners around 95% of the time.1 This presents another opportunity as the car share footprint grows, because parking spaces can become flexible when not being used for car “storage”. New technology allows CSO’s to rent out car share spaces during the time that Figure 2: How Car Sharing Helps the Environment

6 vehicles are out on a reservation or away for maintenance/repair. With less vehicles, more reliance on healthy and efficient commuting options, and a reduction in stress on city infrastructure, public spaces (parks, bike lanes, sidewalks) can be used more equitably and consciously. The Future A report has forecasted that the U.S. will spend $2.8 trillion on traffic between 2013 and 2030, which includes wasted time, fuel, and the value of carbon emissions.2 The importance of proactive solution-oriented steps must be seriously considered by all local and global decision-makers. A synergy of multimodal transportation options is essential to the future of urban and suburban mobility. This synergy, as seen in Figure 3, provides overlapping and complimentary options that cover nearly every trip type. Communities that adopt and encourage this model provide travelers with a holistic, well-rounded transportation network. Current patterns and future projections also show that the transportation industry is becoming more diverse and at a faster pace. Different models are being created and segmented and sub-segmented, as seen in Figure 4. Figure 3 Figure 4

7 5. Zoning Review and a Look at Other Communities Cambridge Zoning regulations are outlined in the Cambridge Zoning Ordinance Articles 6.21 and 6.24, and “allow the limited use of parking spaces for Carsharing as a means to provide mobility options…thereby promoting City goals by increasing mobility, reducing reliance on automobile ownership and use, and lessening the total demand for parking.”3 The language allows for station-based types of car sharing (round-trip and one-way) with dedicated parking spaces, but appears to exclude the floating model. Companies like Car2Go only operate the floating model and require unrestricted, on-street parking spaces. These companies cannot lawfully conform, excluding their participation in Cambridge’s car share network. Similarly, peer-to-peer car sharing companies such as Turo or GetAround are, arguably, business operations that cannot be run in residential districts. Therefore, car owners living in residential districts cannot legally offer their private cars for rent through these platforms. Boston In February 2015, Boston initiated a Requests for Proposals (RFP) for a pilot program, DriveBoston. The RFP called for two programs. The first program made available 40 dedicated public parking spaces, both on-street and in municipal lots, per each CSO. The second provided 150 floating permits provided to CSO’s that operated a station-free floating model. The goals were outlined to:4 • Reduce personally owned vehicles by targeting high car/low mileage areas • Multiply the number of mobility options, fill transit gaps, provide flexibility in mode choice, and alleviate congestion • Increase car sharing visibility • Connect and support “Main Street Districts” Boston received responses from, and signed contracts with Zipcar and Enterprise CarShare, but failed to formalize an agreement with Car2Go, the biggest “floating” offeror. Car2Go has been looking to join the Boston market for years, but said the pilot offering was not ambitious enough to deliver a viable service. The pilot moved forward with Zipcar and Enterprise CarShare with 80 dedicated parking spaces, 49 in municipal lots and 31 on-street. The pilot has been extended an additional year due to positive results and feedback:5 • Car share vehicles were driven seven times more than personally owned vehicles • The average number of unique users per vehicle was 23, as opposed to two for a personally owned vehicle • Low-income neighborhoods saw the biggest demand and highest utilization rates

8 New York City, San Francisco, Seattle, Washington D.C., Hoboken NJ Similar to Boston, these cities have pioneered car share pilots in similar fashion. The common threads are access to dedicated on-street spaces and requirements for underserved neighborhoods. New York City Council supported car share legislation, signed in 2017, to establish an on-street car share pilot program.6 Minneapolis–Saint Paul The Twin Cities lost one of their CSO’s due to high taxes. Car rental taxes total around 22%, justified by the fact that most rentals are made by business travelers, tourists, and other out- of-towners.7 Car sharing is just the opposite, competing with car owners, not rental companies, and are almost entirely local. Legislation was introduced in 2017, now in committee, to exempt CSO’s from rental taxes and fees.8 California, Oregon, Washington Governor Arnold Schwarzenegger signed new legislation in 2010 allowing residents to share their personally owned cars in vehicle sharing pools without risk of losing their car insurance (insurance companies previously did not cover a customer who shared their car in exchange for money). California was the first in the nation to pass such legislation.9 Oregon followed shortly after in 2011, and Washington in 2012.10 This facilitates individuals’ participation in the P2P car share economy. 6. Recommendations Given Cambridge’s desire to minimize personal car ownership and use, it makes sense to allow people to rent their personally owned vehicles through either B2C or P2P car sharing companies. Because a vehicle’s safety is assured by already required state inspections and because insurance is assigned to the car and required for a car to be registered in Massachusetts, the City would be put in the position of guaranteeing vehicle safety for car sharing as it is for home sharing. Further, unlike home sharing programs, renting of personal cars does not deplete an important local resource such as housing. It would be important, however, to ensure that people were not building rental fleets for operation out of residential districts. Because greater ease of car sharing would be a net benefit for the City, reducing the need for car ownership by residents, and because there is no need for City oversight beyond traditional zoning enforcement, there would be no need for a permit or fee process to be associated with this program. Accordingly, the City Council should amend the zoning ordinance to allow residents of Cambridge who have registered their car in Cambridge to offer one car to the general public via a car sharing platform. A possible zoning amendment would read as such:

9 4.27 Peer-to-Peer Car Sharing. Any passenger vehicle registered in Cambridge may be rented by its owner(s) to the general public via an internet-based car sharing platform regardless of the zoning district in which that vehicle is garaged or regularly parked. 4.27.1 Only one car per residential unit may be rented in this fashion.

10 References 1- Morris, David. (2016/03/13). Today’s Cars Are Parked 95% of the Time. http://fortune.com/2016/03/13/cars-parked-95-percent-of-time/ 2- McNew, Linsey. (2014/10/14). Americans Will Waste $2.8 Trillion on Traffic by 2030 if Gridlock Persists. http://inrix.com/press-releases/americans-will-waste-2-8-trillion-on-traffic-by- 2030-if-gridlock-persists/ 3- City of Cambridge. Ordinance Number 1380. http://www.cambridgema.gov/~/media/Files/CDD/ZoningDevel/Amendments/Ordinances/zngam end_1380_carsharing.pdf?la=en 4- City of Boston. (2015/02/02). DriveBoston, A Request for Proposals for a Boston Vehicle Sharing Program. 5- City of Boston. DriveBoston. https://www.boston.gov/transportation/drive-boston#drive-boston- pilot-results 6- New York City Department of Transportation. (2017/06). New York City Carshare Pilot. http://nycdotcarshare.info/sites/default/files/2017-06/Qn14_carshare_6.13.17.pdf 7- Moore, Janet. (2017/02/11). Car2Go and gone: Legislation aims to lure more car-sharing services to TC. http://www.startribune.com/car2go-and-gone-legislation-aims-to-lure-more-car- sharing-services-to-tc/413444813/ 8- Bill Track MN HF522. https://www.billtrack50.com/BillDetail/799027 9- Gorenflo, Neal. (2010/09/29). California's P2P Car-sharing Bill Signed into Law https://www.shareable.net/blog/californias-p2p-car-sharing-bill-signed-into-law 10- Does the car sharing legislation in California, Washington, and Oregon affect me? https://support.turo.com/hc/en-us/articles/203991840-Does-the-car-sharing-legislation-in- California-Washington-and-Oregon-affect-me- Figure 1- Gutierrez, Mark. (2018/04/03). Modes of Transportation- Automobile. Figure 2- Gutierrez, Mark. Figure 3- Kelley, Craig. Figure 4- Gutierrez, Mark. Figure 5- Ali. Available Turo Rental in Boston. https://turo.com/rentals/cars/ma/boston/honda- accord/280229?s=wlVVrY-Z Figure 6- Zipcar Green: How Car Sharing Helps the Environment [Infographic] http://www.zipcar.com/ziptopia/inside-zipcar/zipcar-green-how-car-sharing-helps-the- environment-infographic Figure 7- Rapier, Graham. (2017/06/15). Bank of America: We've reached 'peak car'. http://www.businessinsider.com/bank-of-america-weve-reached-peak-car-2017- 6?r=UK&IR=T Figure 8- Hagel, J., Seely-Brown, J., Samoylova, T., Lui, M. (2013/10/04). From exponential technologies to exponential innovation. https://www2.deloitte.com/insights/us/en/industry/technology/from-exponential- technologies-to-exponential-innovation.html

11 Disclaimer Mark Gutierrez, author of this memo, worked for Zipcar from 2013-2016 and had decision- making authority on the DriveBoston pilot, municipal relationships and expansion plans (including in Cambridge), and other relevant projects.