The City of Chicago recently sold the right to manage its parking meters for the next 75 years to a private company, for a payment of $1.15 billion. The city retains the right to make parking laws and enforce them, although some aspects of enforcement are now shared. Not surprisingly, there's some trouble in the Windy City: Long a Driver’s Curse, Chicago Parking Gets Worse .
Not only have meter rates gone up, enforcement seems to have become more aggressive. Aside from the fact that Chicago looks to parking fines for revenue in tough economic times, there appear to be market design reasons for this.
Here is the agreement between the city and the contractor. Section 3.2e on page 40 reveals that the contractor as well as the city may issue tickets to illegally parked cars at meters.
So now there are two motivations for issuing tickets; the city issues them to raise revenue from parking fines and to enforce the parking laws, and the contractor issues them to increase meter revenue by discouraging people from parking without paying or parking after the payment has expired.
The city can raise revenues from fines by aggressively enforcing laws, e.g. about how many inches you may park from the curb. The contractor can raise revenues by ticketing cars promptly after meters expire. (Both the city and the contractor have an interest in enforcing the laws that say you must park between the lines.)
Some problems with getting new meters (which accept credit cards) to work properly have compounded the angst.
What to do? Carry lots of quarters when you drive in Chicago, at least until things settle down.