Chicago parking garages warn proposed tax hike will drive up their rates

CHICAGO (CBS) -- Operators of Chicago parking garages are warning that their rates could go up next year, if a proposed tax is approved as part of Mayor Brandon Johnson's budget plan for 2025.

For every $20 that drivers pay at Chicago parking garages or for valet parking, more than half – about $10.50 – goes towards city, county, and state taxes, and that percentage could be going up even higher.

As part of his budget plan for next year, the mayor has proposed making the current 20% weekend parking tax for parking garages and valets the same as the weekday rate of 22%, raising $3.1 million.

Devie Windom suffered sticker shock on Friday when parking in a garage downtown for $63.

"I was not expecting that," he said. "I feel like I got robbed. That's what it feels like – highway robbery."

Signs hanging at the payment machines at the garage where she parked warned prices could be going up next year.

Rafael Flores, who was visiting from New Jersey on Friday, said he had no choice but to park in a garage.

"So we have to pay whatever it is now, but to raise it from where it is now? Insane. It's not right for the people that live here, or the people that visit," he said.

Parking garage managers said if the weekend tax rate goes up, they'll have no choice but to raise rates.

"The industry is still struggling. We're struggling," said Nosa Aluyi, lead senior operations manager for Interpark.

Aluyi said the number of daily parkers is down 12% to 15% from before the COVID-19 pandemic, and the number of monthly parking garage users is down even more – 20% to 35% – as more people choose to work remotely.

He said he's worried hiking prices will further drive away customers.

"We're already getting feedback from people to say, 'Hey, if this happens, and my rates go up, I'm going to cancel,'" he said.

Ald. Brian Hopkins (2nd) has one of Aluyi's garages in his ward, and said the mayor's office has proposed parking tax hikes as a way to bridge the 2025 budget gap.

But the alderman said the city already has a glut of parking garages downtown, with so many people now working remotely.

"Supply and demand is the key, and right now we don't have the demand for parking that we used to, and we have an oversupply," he said.

Chicago parkers already pay anywhere from 32% in city, county, and state taxes for parking garages on weekends, 34% for weekdays, and up to 40% on monthly passes.

Chicago's parking garage taxes are higher than other major cities, including Los Angeles (10%), New York (18.5%), San Francisco (25%), and Washington D.C. (18%).

"I didn't know we were larger than New York. That's remarkable. I didn't realize that, yeah. Well, we like to be ahead of New York when we can, but this maybe isn't the distinction that we want to have; to have a higher parking rate than Manhattan," Hopkins said.

Officials at Interpark said they've dropped rates since the pandemic to bring drivers downtown, and now they need the city to support them too.

Windom said that the next time he comes downtown, he is probably going to catch a ride rather than drive and park in a garage.