On November 5, 2001, the City Council adopted Ordinance No. 01C-11, now codified as MICC 10.74 - Permit Parking, designed to reduce the impacts of Park-and-Ride overflow parking in the North Mercer residential neighborhood and portions of the Town Center District.

These Permit Parking restrictions went into effect January 7, 2002.  All Mercer Island residents could avail themselves of the privileges of the Permit Parking program by obtaining an annual permit at a nominal cost of five dollars.  Off-islanders are ineligible for permits, thereby allowing only Mercer Island residents to park on certain public streets and in a leased lot on SE 27^th Street, as posted.

The program was successful in accomplishing its goals:

• To control (but not eliminate) overflow parking on North Mercer neighborhood streets by commuters attempting to use the Park & Ride so that neighborhood residents can use on-street parking in their neighborhood during weekdays.
• To allow all Mercer Island residents to find a parking space so they can use transit for their daily commute and attend special events.
• To remove illegally parked vehicles (e.g.: blocking driveways, mailboxes, water meters) during restricted hours on designated streets and within private parking lots in the Town Center District.
• To improve traffic flow on narrow, neighborhood streets for resident and public safety access.

In May, 2002, the Council considered adopting criteria and a process to establish a more restrictive Residential Parking Zone (RPZ) on the Island, but took no action.

In late July, 2003, the Council requested that staff revisit the issues surrounding the overflow parking problems in the North Mercer neighborhood, in light of existing conditions as well as several upcoming major construction projects (Sound Transit Park-and-Ride lot expansion and the remodel of the Community Center at Mercer View (CCMV)).  Council was concerned that these projects would further impact parking in that area.  In particular, Council stated it wanted staff to provide an Ordinance creating new parking district with more restrictive parking provisions to replace the then-current Permit Parking Program in the North Mercer neighborhood.