The difficult decision to increase SLO parking rates

May 25, 2023

Opinion by SLO City Councilwoman Andy Pease

You’re probably going to be mad about this. Or maybe, like me, you’ll go through stages of disbelief, frustration then acceptance: Parking rates in San Luis Obispo are going up. It was one of the most difficult votes I’ve had to make, but I believe it was necessary, and we’re working to reduce impacts to our residents and local businesses.

So, why are we increasing parking rates? It’s a bit of a tangled web that started many years ago with the reasonable intent to support growing businesses downtown who wanted to build on surface parking lots. Community leaders decided that the additional parking needs would be met in structures along the perimeter of downtown, so we built the ones on Marsh and Palm and planned for the final structure along Nipomo. New development paid lieu fees in anticipation of the structure; the rest of the cost would be covered by parking fees, for when the additional parking would be needed.

Fast forward to 2018. Downtown is busy and parking occupancy rates are going up. SLO Rep theater is growing and needs a new home, so it was a natural fit that the new Palm-Nipomo parking structure would be a great co-project with SLO Rep and the burgeoning Cultural Arts District. The structure would be $25 million, but the parking fund had some savings and could finance the rest.

Then COVID hit, and we made parking free downtown for more than a year, which diminished parking funds without bringing in revenue. Concurrently, there have been astronomical increases in construction costs, and the cost estimate ballooned to $52 million.

Now we’re in a pickle. We don’t have that kind of savings, so to get a loan, we need to demonstrate to lending agencies adequate revenue, thus triggering an increase in hourly meter rates from $2.50/hour to $4.00/hour, and the parking structure to $3.00/hour, starting July 1 of this year.

We looked at alternatives, and none looked great. Don’t build the structure? Then we would have parking shortages for the foreseeable future, possibly jeopardizing the new SLO Rep theater. Although perhaps someday a regional theater with no parking could work here, that’s not in the immediate future.

The structure enables not only the theater, but expanded access to the SLO Museum of Art, the Children’s Museum, the History Center, Mission Plaza, retail shops and restaurants, as well as several commercial projects in that area of town that are on hold pending parking.

Delay construction? Delays further add costs and risk the SLO Rep project. Use General Funds to supplement construction? Parking is an “enterprise fund”, set up to cover its own expenses, and we need General Funds for maintaining roads, running programs and public safety.

Faced with these realities, I and the council majority voted to build the parking structure and increase parking rates to cover the cost, because we believe this is an essential investment in our downtown and in our community.

Since that decision, we have been working closely with our community partners to address three primary concerns: Keep locals coming downtown; support employee parking needs; and provide clear communication. Over the next few months, you’ll hear more about all of these.

To start, we know that having the first hour free in the structures is well used by locals but is a considerable loss of revenue from the many visitors downtown. To balance these needs, we are rolling out the Park Local program – any resident in San Luis Obispo County will be able park in the main Palm Street Garage and retain the first hour free. There will be a simple registration process, so stay tuned for details and links.

We’ll also have technology upgrades, more ways and locations to pay, improved signage, opportunity for merchant validation, employee discount programs, and more. And, of course, we’ll continue to invest in safe and enjoyable bike lanes, sidewalks and buses for those traveling without a personal vehicle. We want everyone to have options for coming downtown.