Town Discusses Parking Fee Hike To Boost Budget

But because of concerns for downtown merchants who could stand to lose business with these hikes, Chapel Hill Town Council members also have decided to consider the idea of subsidized parking downtown.

The town is facing a $1.4 million shortfall, which was caused mostly by Gov. Mike Easley's plans to withhold municipal funds to curb a $900 million statewide shortfall. The state's potential action could cause a sharp decrease in the town's revenue.

"The state seems to think that local towns and cities should 'share the pain,' as if we helped to create the problem," said Chapel Hill Town Manager Cal Horton. "I believe the state believes it's easy money to take."

To combat the fiscal pressure, Chapel Hill officials must make program cuts and increase prices to compensate for the lost money. At a work session Wednesday, council members considered several recommendations about how to achieve this goal.

The increase in the cost of meter parking in Chapel Hill is one option being considered. This would increase parking fees from $1.00 to $1.25 per hour, a change that could generate an additional $47,000 in town revenue.

In addition, the council members might decide to increase town deck parking to $1.25 per hour. They also are discussing the possibility of raising monthly parking rates from $65 to $75. These two price increases for parking are projected to produce a combined revenue of $210,000. The increase in hourly parking prices would place town parking rates above the UNC campus rates, which generally run at $1 an hour.

But council member Bill Strom said he supports depositing funds raised by the increased parking rates into the General Fund for the town government. "I think it is appropriate in order to directly reduce the tax complications for this year," he said.

Council member Pat Evans disagreed with the parking recommendations and said increased parking rates would discourage people from coming to the downtown area.

"I have not found any college communities that have rates anywhere near as high as ours," Evans said. "I don't think we should make it more expensive for people to come downtown. We should make it less expensive."

To mitigate the impact of increased parking costs on the downtown area, the council decided to begin researching the possibility of offering subsidized parking for merchants. With subsidized parking, patrons of certain stores could more easily continue parking downtown.

The council members will not make any decisions until this year's official budget is completed, which is expected to occur by the end of May.

Unfortunately, Horton said, these money problems probably will not end after this year because the state is estimated to reduce its budget by an additional $1.3 billion to $1.5 billion next year.

"It is my expectation that the state picture may get worse by comparison of this year," Horton said. "I don't think this year is the end of it."

The City Editor can be reached at citydesk@unc.edu.