That money will have to come from loans and possibly an authorised overspend.
The additional spaces would generate about $750,000 a year, but parking strategy working-party chairman John Bezett said the changes were not aimed at revenue gathering.
Instead, initially at least, they would cost the Dunedin City Council money.
Councillors yesterday voted unanimously at a planning and environment committee meeting to introduce the rules.
The need for a parking strategy was identified when the city's transportation strategy was developed in 2006.
The council decided on a move towards travel demand management - limiting parking or increasing charges to make driving less attractive and promoting more sustainable transport options like public transport.
That was to deal with the negative effects of vehicles, including congestion, air pollution, noise and encouraging obesity.
[comment caption=Do you agree with the DCC's decision to hike the price of parking?] The other major changes under the strategy included a four-hour maximum stay at parking meters, except around Dunedin Hospital, increases in off-street parking costs, "market rates" for leased parking, and tightened rules for residential parking near the city.
At the meeting yesterday, Cr Bezett played down a comment from transportation planning manager Don Hill the changes were "major".
Cr Bezett said the 34 submitters' concerns had been dealt with well and the $4 an hour cost in George St was not onerous.
Parking in George St was originally going to cost $5 an hour under the draft strategy, but that figure was not popular in submissions.
Mr Hill said after the meeting the $1 million implementation cost would be spent on new pay and display machines, signs and a marketing programme.
"That will start in late January."
Changes further away from the central city would take place as signs needed replacing over the next five years.
Major concerns raised during the submission process were the difficulties inner-city residents had parking their vehicles and concern about the possibility of a price rise.
The price did not rise and would stay at $150.
Mr Hill said residents could apply for two spaces at that cost, less the number of off-street parks they had.
The council would try to tie the parks more closely to residents, as the system had been abused.
That included landlords who lived away from the central city offering parks for $20 a week.
"That's straight profiteering from the council," he said.
"It's for residents, rather than landlords."
The council's files would be updated and people applying for spaces would have to prove they lived at an address.
Mr Hill said the council's leased parking would be phased out, but that would be "eventually; a very slow thing".
Cycling would be encouraged by providing parking facilities and cycle lanes would take precedence over parking.
New parking rules
• Four-hour maximum stay on all paid parks.
• Off-street parking charges raised from $1.60 to $2.
• Leased parking costs to rise.
• Free parking for over-75s for on-street parking in core inner and outer zones only.
