Alexandria City Council members seemed in agreement last night that parking in Old Town is a problem that has gradually built as the area has become more fashionable, more affluent and more crowded with shoppers and restaurant patrons.

The council released a report recommending significant changes in parking regulations, including a requirement that new businesses provide parking for customers or pay the city $5,000 for each required parking space.

"The problem has been building for the last 15 years," said council member Patricia S. Ticer, who helped prepare the study. "Everybody is being squeezed to the point where they might be squeezed out and decide to go somewhere else."

The council decided last year to attack the parking problem after residents complained that they must park blocks away from home because of overflow commercial parking. They said employes of Old Town businesses park all day in two-hour residential parking zones by moving their cars frequently.

The report released at last night's council meeting recommends:

*Requiring new businesses to pay for parking spaces they do not provide. Owners of existing establishments would be exempt.

*Increasing parking meter rates from 50 cents to $1 an hour.

*Implementing programs encouraging people who work in Old Town to park in garages, or use Metro and the city's DASH bus system.

*Possibly opening a parking lot for city employes at Jones Point under the Woodrow Wilson Bridge and busing the employes to work.

Reducing first hour rates in city-owned lots to encourage short-term parking.

Joel G. Blanchette, owner of the American Artisan Inc. shop, called the plan "so unfair," particularly the requirement for parking spaces or payment to the city. "It will force small businesses out," he said in a telephone interview. "The whole flavor of Old Town will change."

Blanchette subleases three Alexandria shops and said that under the proposal if one tenant left, the new lessee would be required to provide parking. "If the new tenant couldn't afford the $5,000 [per space], I'll be stuck with an empty space," he said.

While Old Town Civic Association President Kleber S. Masterson said he understands Blanchette's problem, he said residents are tired of businesses gobbling up residential parking spots.

"It's very discouraging. You have to park blocks away," Masterson said. Because Alexandria's 18th-century downtown district was designed with few garages, he said, residents should have a right to on-street parking.

The council, which scheduled a public hearing for Feb. 22, also recommended extending the restricted parking hours on the city streets from 5 p.m. to 11 p.m. Monday through Saturday.

In other action, the council voted 6 to 1 to pay $636,000 for the first payment of a three-acre slice of parkland across from Cameron Station. Mayor James P. Moran Jr. was the only dissenter, saying that the $1.8 million park was too expensive.

The council deferred action on a proposal to retain City Attorney Cyril (Des) Calley as special legal counsel to the city for a year after he resigns for $70,074.