City Council approves parking rate increases

City Council approves modest rate hike amid concerns about fiscal pressures and business impact

The Hermosa Beach City Council voted Tuesday to increase parking meter rates across the city, a move officials say is necessary to address looming budget shortfalls and infrastructure needs but one that sparked concerns from residents and business owners about its potential impact.

Parking Rates : The Skinny

After extensive deliberation, the council approved raising on-street meter rates from $2 to $3 per hour and beach parking lot rates from $2.50 to $3.50 per hour. The increase, which represents a more conservative approach than staff's initial recommendation, is expected to generate additional revenue to help offset anticipated costs.

Administrative Services Director Brandon Walker presented the proposal, explaining that the city faces significant fiscal challenges in the coming years. The most pressing concern is the upcoming renegotiation of fire and lifeguard contracts with Los Angeles County in fiscal year 2027-28, which could see cost increases of up to 25 percent. Additionally, the city has substantial unfunded infrastructure needs, including structural repairs to beach Lot C, pier maintenance, inadequate paving funds, and the long-awaited city yard project.

"We are heavily reliant on property tax," Walker told the council, noting that parking meters generate approximately $5 million annually—representing about 10 percent of the city's $56 million budget. The proposed increases aim to bolster this revenue stream, with each 25-cent increase projected to generate an additional $375,000 per year.

Walker emphasized that more than 90 percent of parking meter transactions come from non-residents, meaning the financial burden would largely fall on visitors rather than Hermosa Beach residents. The city's current rates had last been increased in 2023.

The proposal initially recommended raising on-street rates to $3 per hour and beach lot rates to $5 per hour, which would have generated an estimated $3.8 million in additional annual revenue. However, some council members and community speakers expressed concern about the aggressive nature of these increases, particularly given the challenging economic climate for local businesses.

Former council member George Barks urged caution, referencing his experience navigating similar budget challenges during his tenure.

"I ask you to take a little more time. If you're going to make some increases initially, make them small to start with, and let's see what the impact is going to be." - George Barks

Business owners echoed these concerns. Kathy Knoll, representing local establishments, warned that steep increases could drive customers to neighboring Manhattan Beach or Redondo Beach. "We are in a competitive situation with our neighboring cities," she noted, adding that higher rates might deter visitors who typically patronize multiple businesses during their visits.

Some speakers advocated for dynamic pricing that would adjust rates based on demand, charging more during busy summer weekends and less during quieter winter weekdays. However, the city's current meter technology cannot support this feature. Walker indicated that new multi-space meters capable of dynamic pricing would be installed in beach lots by early 2026, with upgrades to street meters following by mid-year.

Council members weighed these competing concerns carefully. Mayor Pro Tem Michael Detoy and Council Member Dean Francois both supported increases but questioned whether the full proposed amounts were appropriate given the lack of dynamic pricing capability and concerns about business impacts.

Mayor Rob Saemann ultimately proposed the compromise that passed, noting that while the city needs additional revenue, "for us to make a giant leap right now is not a good idea." He emphasized that once new meter technology is installed next year, the council can revisit rates and implement more sophisticated pricing strategies.

Council Member Michael Keegan cast the lone dissenting vote against the increase, arguing that even more modest changes—perhaps just 25 cents—would be more appropriate given current economic conditions and that the city should wait until license plate reader technology is fully implemented before making significant rate adjustments.

The council also discussed but ultimately rejected a proposal to install meters at Lot E, a currently free 25-space parking area near PCH and 2nd Street. Despite projections of $50,000 in potential annual revenue, concerns about spillover parking into residential neighborhoods and the lot's proximity to local businesses led to the proposal's defeat. Councilmember Ray Jackson was the lone dissenting voice, continuing his campaign to raise fees and fines across the City. Jackson has also advocated for the removal of the traditional free meter parking during the holidays.

The new parking rates are expected to take effect in the coming weeks, with city officials pledging to monitor their impact on both revenue generation and business activity as the holiday season approaches.

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