TO:
Honorable Parking and Public Improvements Commission Chair and Commissioners
THROUGH:
Masa Alkire, Community Development Director
FROM:
Libby Bretthauer, Finance Director
Emy-Rose Hanna, Financial Services Manager
Erik Zandvliet, City Traffic Engineer
Justin Urbanski, Associate Planner
SUBJECT:Title
Consideration of Variable Parking Meter Rates in Accordance with Adopted Parking Management Strategies
(Estimated Time: 30 Min.)
DISCUSS AND PROVIDE DIRECTION
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Recommended Action
RECOMMENDATION:
Staff recommends that the Parking and Public Improvements Commission discuss the parking meter rate adjustments proposed in the City’s Parking Management Study (“Study”) and pass a motion recommending approval by the City Council. This action would recommend modifying the hourly parking meter rates to a variable rate structure that factors the time of year (peak and off-peak seasons) and location (high demand and lower demand areas).
BACKGROUND:
The Citywide parking meter rates are reevaluated periodically to ensure rate revenue is sufficient and can support the cost of rising operations in the various Parking Funds and replacement of aging parking infrastructure. On September 15, 2020, the City Council approved increases for parking meter rates to $2.00 per hour for on-street meters and City-owned parking lots. Six months later on March 16, 2021, City Council approved increases for parking meter rates to $2.50 per hour for beach parking lots (Pier, 26th Street and El Porto). These increases were a direct response to the impact of the COVID-19 pandemic and the need to offset parking revenue losses due to outdoor dining areas utilizing metered parking spaces. The last parking meter rate adjustments were approved on April 15, 2025, which set the parking meter rates at $2.50 per hour for on-street meters and City-owned parking lots and $3.50 per hour for beach parking lots (Pier, 26th Street and El Porto).
On September 25, 2025, the Parking and Public Improvements Commission reviewed the Draft City Parking Management Strategies and Toolkit and provided direction to recommend a list of parking strategies to City Council for further consideration. Among the several strategies identified through the Study, variable parking meter rates were recommended as a best practice to address demand and equity, whereby parking rates could remain lower in non-peak seasons/low-demand areas while the parking rates would be higher in the peak seasons/high-demand areas.
On November 3, 2025, the City Council discussed and approved the Parking Management Strategies and Toolkit. On April 7, 2026, the City Council approved the City Parking Management Study Report and provided direction to proceed with implementing the parking strategies identified in the Study, which included variable hourly parking rates based on season and location.
Additionally, the parking meter rates were identified as a critical revenue enhancement need during the FY 2027 Budget adoption presentation on June 2, 2026, given the amount of unfunded infrastructure and maintenance obligations. At that meeting, City Council directed staff to come back with the proposed parking meter rates developed through the Study.
With rising operational costs, aging parking infrastructure, sudden Lot 3 demolition and increased parking demand, staff has been focused on re-evaluating these parking programs on a more frequent basis in an effort to better align rate revenue with critical funding needs.
DISCUSSION:
The recommended action of adjusting the parking meter rates for the City lots, on-street meters, and beach lots (County and State) was developed through strategies identified in the adopted City Parking Management Study. These adjustments would entail both increases and decreases to the hourly parking rates, which would vary depending on time of year (peak summer months versus off-peak months) and parking location (high demand parking areas versus lower demand parking).
The purpose of variable pricing strategies is to allow for greater utilization of the available parking supply and to incentivize alternative transportation modes. The recommended variable rates range from $2.50 to $4.00 per hour and are identified in more detail in the attached PowerPoint. If approved by City Council at the July 7, 2026, City Council Meeting, the proposed parking meter rate adjustments would go into effect on August 1, 2026.
For Fiscal Year 2026-2027, the parking rate adjustments would result in an estimated increase of $916,000 in the City Parking Fund and $36,000 in the State Pier and Parking Lot Fund. There would be a temporary revenue decrease of $276,952 in the County Parking Lots Fund, primarily due to the temporary closure of Bruce’s Beach Parking Lot in order to construct the 28th Street Infiltration Project.
These parking rate adjustments will provide the necessary revenue to support ongoing parking infrastructure needs and related activity. The abrupt and unanticipated closure of Parking Lot 3 in July 2024 caused a ripple effect that resulted in less parking availability, increased parking demand and urgency for solutions to mitigate the parking impacts from the temporary loss of 145 parking spaces that were previously in Lot 3. With Project Pulse underway, the combination of Lot 3 and 400 MBB projects are expected to result in critical replacement parking in the Downtown area. In a scenario where 145 parking spaces are replaced by construction of a new parking structure, construction costs are estimated between $6.5 million to $13.1 million based on an average cost of construction per parking space of $45,000 for above-ground parking up to $90,000 per space for subterranean parking. Based on estimated construction costs of $6.5 million to $13.1 million, the expected increase in debt service payments could be in the range of $400,000 to $800,000 per year.
In addition to the Lot 3 parking lot replacement costs, the City is assessing other critical needs such as aging parking infrastructure throughout Downtown and North Manhattan Beach, waterproofing parking structures and other parking improvement projects as aging infrastructure reaches its maximum useful life.
Due to these critical parking infrastructure needs, the City has determined that additional funding should be obtained through parking meter rate adjustments.
Annual Adjustment
To keep up with the rising costs of maintaining parking operations, infrastructure and future debt issuances, beginning July 1, 2027 through July 1, 2030, the variable parking meter rates would be adjusted annually by ten percent (10%) rounded to the nearest five cents ($0.05). The variable rates and annual adjustments would be authorized by Resolution of the City Council and a Local Coastal Permit with the end date for annual adjustments on July 1, 2030. After this five-year period, the parking rates would be revisited and brought back for further consideration by the PPIC and City Council.
The annual adjustment is consistent with how other jurisdictions have maintained parking meter rates on an annual incremental basis with small increases. This strategy is an alternative to proposing larger/sudden increases every few years. Staff confirmed this annual adjustment is allowable with the Coastal Commission, as confirmed when the City of Newport Beach adopted a similar process.
Parking Meter Rate Survey
In determining the market rate for hourly parking, staff conducted a survey of local southern California cities to evaluate comparable rates and found that the City’s existing parking meter rates of $2.50 - $3.50 were low in comparison to the other cities.
A total of eight cities were surveyed including the cities of Newport Beach, Huntington Beach, Santa Monica, Beverly Hills, Hermosa Beach, Laguna Beach, Long Beach, and Redondo Beach. The survey results range widely as most cities have parking meter rates that vary by lot/location, by season and/or by time of day. For this reason, the survey identifies a range between the lowest and highest hourly rate. For example, hourly rates in Newport Beach range from $4.10 to $8.55, Huntington Beach range from $3.00 to $4.00, Santa Monica range from $2.50 to $3.75, Laguna Beach range from $2.50 to $4.00, Long Beach range from $2.00 to $6.00, Beverly Hills range from $0.00 to $6.00 (parking is free for the first hour), Hermosa Beach range from $3.00 to $3.50, and Redondo Beach range from $1.50 to $2.00. This survey indicates that the price points for parking in prime areas among these municipalities are mostly between $3.00 per hour and $8.55 per hour in beach lots during peak hours. The proposed adjustments to our hourly meter rates would make the price to park in Manhattan Beach comparable with other local cities and would better align with the market rate for parking. These survey results are illustrated in more detail in the attached PowerPoint.
Conclusion:
Staff recommends the Parking and Public Improvements Commission discuss the variable parking meter rates proposed in the City Parking Management Study and pass a motion recommending approval by the City Council. If adopted by City Council on July 7, 2026, the new variable parking meter rates will go into effect August 1, 2026, and will be adjusted annually on July 1 thereafter until July 1, 2030.
PUBLIC OUTREACH:
The Downtown Business and Professionals Association (DBPA), North Manhattan Beach Business and Professionals Association (NMBBPA) and Manhattan Beach Chamber of Commerce have been given a preview of the proposed parking meter rates and were previously provided the Draft City Parking Management Strategies and Toolkit. Staff has also invited the DBPA, NMBBPA and Chamber to this meeting and encouraged them to reach out to their members. The public has been informed of this agenda item as part of the City’s standard meeting notice practices via public bulletin boards, website calendar, and social media.
Additionally, a public notice for the July 7, 2026, City Council public hearing was published in The Beach Reporter on June 25, 2026. As of the writing of this report, staff has not received public comments.
ENVIRONMENTAL REVIEW:
The City has reviewed the proposed project for compliance with the California Environmental Quality Act (CEQA) and has determined that it is not a “Project” as defined under Section 15378 of the State CEQA Guidelines; therefore, pursuant to Section 15060(c)(3) of the State CEQA Guidelines the activity is not subject to CEQA. Thus, no environmental review is necessary.
ATTACHMENTS:
1. PowerPoint Presentation