Orange Street, just south of Mission Inn Avenue, is designated as 'Zone 1' of nine valet zones proposed in the city's six-month downtown valet parking pilot program. (Justin Pardee)
City Council unanimously approved a six-month downtown valet pilot program Tuesday projected to lose $190,597 in its first six months, with the city banking on downtown businesses to market the service and close the financial gap.
Mario's Place owner Leone Palagi has told the Riverside Downtown Partnership that customers are canceling reservations due to parking difficulties, according to Janice Penner, executive director of the Riverside Downtown Partnership, who shared the information in an email interview.
The program, which will cost the city $334,595 over six months, is projected to generate only $144,000 in revenue, leaving a $190,597 shortfall. The city is banking on downtown businesses to actively market the service to customers to close that financial gap.
"Everyone seems like they're interested but really we need to have them to buy into the program to be successful," Public Parking Services Manager Eric Lu told the council. "If the businesses have vested interest in it, that's how this program is going to get off the ground."
The valet service will launch Jan. 1, 2026, operating Friday through Sunday at nine locations throughout the downtown core. Regular rates will be $20 per vehicle, with special event pricing at $30.
The nine valet zones include locations near downtown venues such as the Riverside Municipal Auditorium, the Cheech Riverside Center for California Art, Fox Performing Arts Center, and the Riverside Convention Center. Zones utilize existing loading zones on Orange Street, Market Street, Lemon Street, and University Avenue, as well as metered spaces on Mission Inn Avenue.
Nine downtown valet zones will begin service Jan. 1, operating Friday through Sunday.
Lu acknowledged the financial risk, telling councilmembers the city is "anticipating conservatively" that the program will bring in $144,000 over six months. "So we're going to have a net loss of about $190,000 in the first six months," he said. "Our goal is to focus on marketing and developing the partnerships, and we are going to close the gap."
The valet pilot is the latest in a series of attempts to address downtown parking challenges that have sparked community debate since 2022. That year, the council approved substantial rate increases to address a $1.3 million parking fund deficit, but rolled them back within weeks after intense backlash from businesses and employees who said the rates were too high and would deter customers.
Penner was the only public speaker on the item, and she endorsed the proposal. "Downtown may have parking but there is a shortage in the downtown core, particularly on weekends," she told the council. The Riverside Downtown Partnership has set aside funding to help promote the valet program and plans to work with businesses to encourage participation.
"Businesses, particularly higher end restaurants, have said a valet program will provide a needed convenience for their patrons," Penner said.
ACE Parking was selected through a competitive process by a five-member panel that included traffic engineering staff, parking services staff and representatives from the Riverside Downtown Partnership. The panel unanimously recommended ACE, which Lu described as "by far the premier valet operator in the country" with extensive municipal valet experience in cities like San Diego.
The service will feature what Lu called a white glove valet experience with uniformed staff. Customers will be able to request their vehicles be delivered to a different valet stand from where they dropped them off.
The program will use TEZ Technology, a text-based ticketless system that doesn't require a special app.
Councilmember Philip Falcone called the vote "quick and easy" and moved to approve staff recommendations. The vote was unanimous with no discussion of the $190,597 projected loss or debate about the program's dependency on business participation to break even.
The city will track weekly vehicle counts per day per stand, business participation rates, revenue performance and customer feedback. Lu said the city plans a three-month operational review and will return to City Council after six months with a status update.
The contract includes provisions for two one-year extensions, potentially extending the program to a total term of two years and six months if the pilot proves successful.
City Council will consider reallocating $100,000 for emergency food assistance due to federal shutdown impacts, review a Downtown valet parking pilot, and consider partnership with a South Korean EV company seeking to open in Riverside.
