CHICAGO -- The city tentatively accepted a $1.16 billion bid Tuesday for the rights to manage its parking-meter system, handing a Morgan Stanley-backed group a concession that continues the city's strategy of privatizing its public assets.

Final approval of the deal, which will be decided by a city council vote on Thursday, would establish the first private concession for a publicly owned U.S. parking system, according to Mayor Richard M. Daley. Similar deals over the past three years have seen Chicago pocket nearly $5 billion...