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Jul 04, 2023

Santa Cruz moves forward with downtown parking rate increase

SANTA CRUZ — Parking rates for public lots, meters and permits will go up this

SANTA CRUZ — Parking rates for public lots, meters and permits will go up this summer in downtown Santa Cruz after the Santa Cruz City Council moved to increase parking rates at its Tuesday meeting.

The parking fee increases, which go into effect this July, will be the first since 2018 and are necessary to compensate for the predicted revenue losses caused by the recently enacted state law AB 2097, which takes away parking space requirements for developments within a half mile of a major transit stop — meaning all of downtown — and to replenish the city's parking enterprise fund.

"We have a negative cash flow," said Claire Gallogly, Santa Cruz transportation planner at the Tuesday meeting. "We will continue to have a negative cash flow, and if we continue doing what we are doing, we will be in the hole over $10 million dollars in the next five years."

The city's 2023 budget states that the parking enterprise fund is estimated to be in a nearly $4 million deficit, which is in large part because of the COVID-19 pandemic, according to Gallogly.

"We had a great plan and everything looked great and then 2020 hit and COVID came," she said. "At that time we suspended all rate collection."

The City Council and staff decided to stop collecting parking fees to bolster downtown businesses that were struggling during the pandemic, which "tanked the parking enterprise fund," according to Gallogly.

The parking enterprise fund is driven almost entirely by parking fees and provides financing for numerous city services such as graffiti abatement, trash collection, public restrooms, GO Santa Cruz and support for the Downtown Streets Team.

"It's parking and it's all the things that help make our downtown wonderful, livable and a place that we all want to be," said Gallogly. "It's very important to have this fund well supported."

The fund is also the source of financing for the parking garage component of the mixed use housing, library and parking garage project to be built on Lot 4 downtown. Because the parking enterprise fund is running a deficit, the parking garage will be built with the use of bond financing. Once it is built, none of the parking spaces in the 243 space garage will be designated for the low income residents in the affordable housing component of the building without an additional cost in the form of a monthly permit or hourly and daily parking fees.

"That's actually revenue going in and revenue going out," said Gallogly. "In order to fund that project we would finance it, and so, in our parking model we do anticipate bonding for that project and all associated costs."

At present, parking permits for the downtown are $65 per month, meters range from $1 to $3 per hour depending on the street and number of hours parked. The lots and parking garages cost $1.25 an hour, with a maximum fee of $10 per day.

The parking fee increases recommended by city staff and deliberated on and approved by the city's Downtown Commission and an ad-hoc committee, would raise street meter rates by 75 cents across the board. The hourly rates for lots and garages would also increase by 75 cents resulting in a fee of $2 per hour, and with the maximum daily charge going up from $10 to $16 per day. Parking permit costs would increase from $65 to $75 a month.

"What this would do is create a positive cash flow in FY 24," said Gallogly. "We would be positive all the way out through FY 28 including bonding and financing a new supply project."

The city of Capitola also recently decided to increase its parking rates in the Capitola Village from $1.50 to $2 per hour for street meters, and from $1 per hour to $2 per hour on Cliff Drive. Parking in the upper and lower beach and village parking lots will increase from 50 cents to $1 per hour, and "Surf and Coffee" permits will go up from $50 to $55 after the increases are approved by the Coastal Commission in roughly six months.

According to the staff presentation at Tuesday's meeting, the city of Monterey charges from 50 cents to $2 an hour for street parking and $52.50 for a monthly parking permit.

After questions, discussion and public comment, the City Council voted unanimously to move forward with the downtown parking rate increases with all the councilmembers present.

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