Reader Tina Gao sent in this photo of a parking spot in Rockport, Mass., and asked, “[W]hy would anyone ever pay more than a penny for the spot?” Can anyone offer an explanation for this pricing? If nothing else, Rockport gives us something to do with all those pennies we’d rather throw away. On the other hand, parking this cheap is probably not very good for the environment.
Photo: Tina Gao

To me it looks like the issue at hand was limiting max parking time. So yes parking is partially free but you have to leave (or refresh you meter) in 30 min.
Maybe this is a standard sticker from the manufacturer that somebody forgot to change.
I agree with KO. All your pennies, nickles and dimes can only buy you 30 minutes per the max time limit notice. I would bet the coin slot does not allow for quarters, half dollars or dollars. Confusion about this would likely reap the city more money because some may be trying to buy more time and keep dropping in coins. All you can get is 30 minutes. THEN LEAVE!
THere are other reasons for parking meters besides REVENUE GENERATION. It is to encourage shoppers to patronize businesses in town by having rapidly turned-over, cheap and open parking.
By limiting time to 30 minutes, they are encouraging short visits and probably short commerce volumes in things like Starbucks, dry cleaning, takeout dining and NYTimes purchases.
This revenue stream generates local taxes that far outweigh 20c ents per hour of parking revenue. That is using taxing or fees in a smart way to help local merchants.
In our Little City there is a big hubbub about so-called “predatory towing”, which is when a lot owner tows cars belonging to people who park there and who then, perhaps after shopping in one store served by the lot, walk to another store not served by the lot, the library, etc.
Our City Fathers and Mothers think this is terrible. I think it is consonant with property rights (plenty of signs are posted). An argument in favor is that people avoid very short, polluting, trips. I think this is swamped by the fact that the store owner might want to have spaces open for real-time shoppers, it’s his property, etc.
In addition to what others have already suggested, there may also be legal considerations involved:
In some countries, there may be different types of fines. If the police gives you a fine for parking where you shouldn’t (in a dangerous place for instance), then the money you pay goes directly to the state (in some countries, at least).
If you park your car on a parking spot where you should pay, but you don’t (or you did, but then outstayed your 30 minutes) then it may be considered as “evasion of municipal taxes”. In which case you receive a municipal fine. As the name suggests, the money goes directly to the municipality.
A parking meter may be the legal way for the municipality to claim territory.
I’d say it’s to turn the meters over –
http://www.town.rockport.ma.us/cfml/jobfunction_lv2.cfm?jobfunction=Parking%20Clerk
Charge a quarter! Anyone who isn’t handicapped shouldn’t be driving in Rockport. It uglies up the town and the streets are too crowded anyway.
Or…how about a dollar coin! That would really discourage parking.