When a street redesign to prioritize walking, biking, or transit is introduced, the headlines are predictable: A handful of business owners scream bloody murder. Anecdotes from grumpy merchants tend to dominate the news coverage, but what’s the real economic impact of projects like Select Bus Service, pedestrian plazas, road diets and protected bike lanes? How can it be measured?
A report released by NYC DOT last Friday [PDF] describes a new method to measure the economic effect of street redesigns, using sales tax receipts to compare retail activity before and after a project is implemented. DOT and consultants at Bennett Midland examined seven street redesigns — including road diets, plazas, protected bike lanes, and Select Bus Service routes — and compiled data on retail sales in the project areas as well as similar nearby streets where no design changes were implemented.
While the authors do not claim that all of the improvement in sales is directly caused by street redesigns (there are a lot of factors at work), they did conclude that a street’s “gain in retail sales can at least in part be attributed to changes stemming from the higher quality street environment.” The study also found that the impact becomes apparent relatively quickly: Retailers often see a change in sales within a year of a project being implemented.
While it makes intuitive sense that a better pedestrian environment and high-quality transit and bikeways will draw more foot traffic in a city environment than a car-dominated street, evidence that livable streets are good for business tends to be indirect. Customer intercept surveys have shown that most people in urban areas (including New York) walk, bike, or take transit to go shopping. While customers who drive spend more per trip, they also visit less often than shoppers who don’t drive. The net result: Car-free shoppers spend more than their driving counterparts and have a bigger impact on the bottom line of local businesses. Nevertheless, merchants tend to overestimate the percentage of customers arriving by car and insist on the primacy of car parking as means of access.
With this study, DOT used a third-party data source to see how well sales are actually doing in two large categories: retail outlets like grocery stores, clothing stores and florists, and hospitality services like bars, restaurants, and hotels. The study uses state sales tax receipts because they are available on a quarterly basis can be categorized by business type, allowing for an up-to-date and detailed understanding of how retailers are faring on a particular street. Results can be examined before and after a street design change, and compared with sales trends both borough-wide and and on “control streets” nearby that did not receive street design changes.