The City of Santa Barbara is looking to charge people to park downtown on a “pay-by-plate” basis, using a mobile payment app, website or self-serve kiosk, to save the downtown parking budget from financial collapse.

The details were revealed during the release of the 2025 budget at the City Council meeting on Tuesday.

Overall, the city is projecting a $7.1 million budget shortfall, but that deficit could reach as high as $10.1 million if the city does not approve the “pay-by-plate” fees and several other cost increases to park downtown.

“If we are not able to get the rate structure approved and continue to operate as-is,” Finance Director Keith DeMartini said, “[the Downtown Parking Fund] is projected to deplete all of their reserves by the end of next fiscal year, and also go negative.”

The council did not make any decisions on Tuesday but plans to discuss the matter in more detail next Tuesday, before taking a final vote on the budget in June.

In addition to the “pay-by-plate” fees, the city wants to drop the free time to park in city garages from 75 minutes to 60 minutes, and charge $2 for every hour after that. City surface parking lots would see only 15 minutes free, and a $1.50 charge for every 30 minutes after that.

The “pay-by-plate” fees are expected to generate $2.5 million, and the changes in the parking garages and structures would generate another $1.5 million.

Street parking fees would be in effect from 8 a.m. to 8 p.m. seven days a week, with
possible seasonal adjustments for daylight.

Downtown parking revenues have been dropping ever since the COVID-19 pandemic and after the city shut down several blocks of State Street to vehicles.

“Revenue stability was impacted greatly during COVID due to reduced parking volume, and revenues have not recovered to pre-pandemic levels,” interim City Administrator Sarah Knecht said in her budget message Tuesday. “The fund has been operating in a budget deficit and has been depleting reserves below the City Council reserve policy target.”

The streets proposed for parking meters are roughly Chapala, De la Vina, Anacapa and Santa Barbara streets, from Gutierrez Street to Arrellaga Street.

Councilman Eric Friedman said he has major concerns about the proposals to increase downtown parking in the context of the overall budget. The city’s $7.1 million budget deficit comes as a result of falling hotel bed taxes, increased salary and pension costs, and inflation.

Friedman said that if the city does not approve the parking fee changes, the overall city budget would jump to $10.1 million. It’s not a lock that the city will pass the “pay-by-plate,” fees. If it doesn’t, the city would have to pay general fund money into the downtown parking fund.

“The deficit is real,” Friedman said. “It is something that has been building, and a lot of it is out of our control in terms of cost.”