California's Parking Cash-Out Law
This page last reviewed May 9, 2011
State law requires certain employers who provide subsidized parking for their
employees to offer a cash allowance in lieu of a parking
space. This law is called the parking cash-out program. The
intent of the law is to reduce vehicle commute trips
and emissions by offering employees the option of "cashing
out" their subsidized parking space and taking transit, biking, walking
or carpooling to work. For years, negative tax implications limited the
implementation of the law. But in 1998, federal legislation fixed this
The Air Resources Board has developed a guide that explains the law and answers the questions most frequently asked by employers.
Employers: The guide will help you determine whether you must implement a parking cash-out program.
Employees: If your employer pays for all or part of your parking, ask your employer if you are entitled to the parking cash-out choice.
California's Parking Cash-Out Law: An Informational Guide for Employers
- August 2009 (PDF)
have questions about the parking cash-out law, please contact Dennis Wade at (916) 327-2963.
Parking Cash-Out Case Study Research
This report presents eight case studies of employers who have complied with California's parking cash-out requirement. Cashing out reduced total vehicle emissions for commuting by 12 percent, with a range from 5 to 24 percent for the eight firms. Review or download the abstract or the report.
Commuter Choice Program
A federal program that complements parking cash-out is called the Commuter Choice Program. It provides for benefits that employers can offer to employees to commute to work by methods other than driving alone. To learn more about Commuter Choice, visit the following website:
Federal Transit Administration: Commuter Choice Web Page:
Commuter Choice Program.