CITY COUNCIL STAFF REPORT
April 2, 2024 {{section.number}}a
PUBLIC HEARING: PURSUANT TO ESTABLISHED COUNCIL POLICY, ADOPT A
RESOLUTION IMPLEMENTING THE ANNUAL INDEXED ADJUSTMENTS TO POLICE,
EMS/AMBULANCE, AND DEVELOPMENT-RELATED USER FEES, AND TO THE WASTEWATER CAPACITY FEES, AND SPECIAL EVENT FEES FOR FISCAL YEAR 2024-25 RECOMMENDATION:
Adopt a Resolution implementing annual adjustments to Police, EMS/Ambulance, DevelopmentRelated Fees, Wastewater Capacity Fees, Special Event Fees, and Sports Field Allocation Fees for Fiscal Year 2024-25.
BACKGROUND:
The City Council has generally embedded annual indexing in the approval of fees. Regardless of indexing, state law still requires a public agency to hold a public hearing and affirm fee adjustments, which may not exceed the reasonable cost of providing the service. • On May 3, 2011, the City Council adopted Resolution No. 8472, stating that beginning July 1, 2012, and each fiscal year thereafter, the EMS/Ambulance fees will be increased by the Consumer Price Index (CPI) for the prior calendar year. • On September 6, 2011, the City Council adopted Resolution No. 8500, establishing new and updated development-related fees and wastewater capacity fees that initially went into effect on January 1, 2012. Both fee types were also approved with the provision that they be indexed beginning July 1, 2013. Each fiscal year, development-related fees are to be increased by the CPI for the prior calendar year and wastewater capacity fees are to be increased by the Construction Cost Index (CCI) for the prior calendar year. • On August 16, 2011, the City Council adopted Ordinance No. 2026 amending Coronado Municipal Code Chapter 8.02 entitled “Cost Recovery – Fee and Service Charge System.” Section 8.02.040 requires a resolution to approve fee adjustments at a public hearing. Section 8.02.040(C) also provides that the cost recovery fees shall not exceed the reasonable costs incurred by the City in providing the service. • On February 17, 2015, the City Council adopted Resolution No. 8721, stating that beginning July 1, 2016, and each fiscal year thereafter, certain Police Department fees are to be increased by the CPI for the prior calendar year. • For the types of fees under consideration, the following are the most immediate past City Council resolutions provided for automatic fee adjustments based on CPI and CCI, as long as the adjustments do not exceed the cost of providing the service:
• On October 20, 2020, Council adopted Resolution No. 2020-53 establishing the special events application fee as of July 1, 2021, and requiring an automatic CPI increase every July 1 thereafter.
• On November 17, 2020, the City Council adopted Resolution 2020-58, stating that beginning January 1, 2022, and on the first day of each January thereafter, the field allocation fees shall be increased by the prior calendar year’s CPI, rounded to the nearest $0.25.
• On April 20, 2021, the City Council adopted Resolution No. 2021-22 and the fiscal year 2021-22 schedules of Police, EMS/Ambulance Fees, Development User Fees, Special Event Fees, and Wastewater Capacity Fees effective July 1, 2021, and requiring that automatically on the first day of each July thereafter, such fees are to be increased by either the CPI or CCI (depending on the fee) for the prior calendar year. • On April 5, 2022, the City Council adopted Resolution No. 2022-15 and the fiscal year 2022-23 schedules of Police, EMS/Ambulance Fees, Development User Fees, Special Event Fees, Sports Field Allocation Fees and Wastewater Capacity Fees effective July 1, 2022, and requiring an automatic CPI or CCI increase every July 1 thereafter. • On May 2, 2023, the City Council adopted Resolution No. 2023-18 and the fiscal year 2023-24 schedules of Police, EMS/Ambulance Fees, Development User Fees, Special Event Fees, Sports Field Allocation Fees and Wastewater Capacity Fees effective July 1, 2023, and requiring an automatic CPI or CCI increase every July 1 thereafter.
Pursuant to Article XIIIC Section 1(e)(1) and (6) of the California Constitution, the proposed fee adjustments are exempt from the definition of “tax” and not subject to a vote of the electorate.
The City Council reviews these fees annually for CPI or CCI adjustments as contemplated in the original adoption of the fees in 2011, 2015, and 2020. Generally, annually adjusting the fees for services based on an approved index avoids larger, more significant increases in the future. It has been the City Council policy to avoid large fee increases and instead make smaller annual inflation index fee adjustments. All proposed fees for service have documentation to support the original and adjusted fee amount, which does not exceed the cost to provide the service but recovers some of the cost of providing the service, thereby reducing General Fund subsidies of private development activities and increasing resources for other General Fund activities, projects, or programs to benefit residents.
ANALYSIS:
The Police, EMS/Ambulance, and Development-related User Fees are normally adjusted each fiscal year by the CPI of the San Diego Region for the prior calendar year. The CPI for Calendar Year 2023 was 5.1%. Similarly, Wastewater Capacity Fees are normally adjusted each fiscal year by the Engineering News Record –Construction Cost Index (CCI) for the prior calendar year. The CCI for Calendar Year 2023 was 10.1%.
Although the CPI has moderately decreased from last year, it and the CCI remain at historic high levels. As a result, an adjustment of 5.1% is being proposed for Fiscal Year 2024-25 for each indexed adjustment.
EMS/Ambulance Fees
EMS/Ambulance fees will be adjusted by 5.1% starting July 1, 2024, and automatically by the CPI annually thereafter. Based on the adjustment, ALS transport fees will increase from $1,282 to $1,347 and BLS transport fees will increase from $1,141 to $1,199. (See attachment 1, Exhibit A) Police Services Fees
Police Services Fees will be adjusted by 5.1% starting July 1, 2024, and automatically by the CPI annually thereafter with a few exceptions, such as no fee alarm permits, parking decals, and oversized vehicle guest parking permits. (See attachment 1, Exhibit B) Animal Service Fees
Animal Service Fees, found under the Police Services Fee Schedule, will be adjusted by 5.1% starting July 1, 2024, and automatically by the CPI annually thereafter. (See attachment 1, Exhibit B, Fee # 36-69)
Wastewater Capacity Fees
Wastewater Capacity fees are charged to new developments that connect to the City’s wastewater system, or to developments that result in a change of use. Wastewater Capacity Fees will be adjusted by 5.1% starting July 1, 2024, and automatically by the CCI annually thereafter.
The current Wastewater Capacity fee for a single-family dwelling unit will increase from $7,360 to $7,735. This connection fee is not a service charge for the annual treatment and collection of wastewater. (See Attachment 1, Exhibit C.)
Development-Related Fees
The FY 2009-10 City-wide User Fee Study proposed a methodology for calculating building permit fees by developing a fee structure based upon a unit cost-based approach rather than the valuation approach that was previously used. As adopted, the fees charged are directly related to the cost of the services provided. For FY 2024-25, most of the development-related fees will be adjusted by 5.1% and will automatically be adjusted by the CPI annually thereafter, with the exception of a few fees where there is a public benefit for a lower or no cost fee, such as for a residential water conservation project, and some minor do-it-yourself household improvements. (See attachment 1, Exhibit D)
Storm Water Fees
The current storm water user fee schedule was established in FY 2014-15 to recover costs of both City staff and consultant pass-through expenses associated with storm water development review and inspection services. Fees will be adjusted by 5.1% starting July 1, 2024, and will automatically be adjusted by the CPI annually thereafter. This fee is related to new development and is not the fee assessed in support of the Storm Drain fund. (see Attachment 1, Exhibit D, Public Services User Fee Schedule)
Special Event Application Fee
The special event application fee was established in 2020 to help recoup the administrative cost of reviewing applications. Fees will be adjusted by 5.1% for FY 2024-25 and will automatically be adjusted by the CPI annually thereafter. (See Attachment 1, Exhibit E) Library
On June 7, 2022, the City Council voted to eliminate the Coronado Public Library’s overdue material fines, effective July 1, 2022. In FY 2023-24, the Library established two new fees for the Digital Media Lab Circuit that included a fee for Smart Vinyl and Transfer Tape. The remaining Library Fines and Service Fees are not subject to annual CPI adjustments. (See Attachment 1, Exhibit E)
Sports Field Allocation Fees
Due to the Recreation and Golf Services fee study currently taking place, no changes are proposed for the sports field allocation fees at this time. Adjustments to these fees will be considered at a later date once the fee study and cost recovery model are developed and presented to City Council. (See Attachment 1, Exhibit F) FISCAL IMPACT:
The fiscal impact to the City of the annual proposed CPI/CCI increase to fees is about $161,000 based on historic fee revenues.
ALTERNATIVE:
The City Council could decide not to adjust the fees or make different adjustments as long as the adjustments do not exceed the actual or reasonable cost of providing the service.
CALIFORNIA ENVIRONMENTAL QUALITY ACT:
Not Applicable
PUBLIC NOTICE:
Legal notice of the agenda item was published in the Coronado Eagle & Journal on March 20 and March 27, 2024. Changes to all fees included in this staff report will take effect on July 1, 2024.
ATTACHMENTS:
1. Resolution and User Fees Exhibits FY 2024-25
2. Declaration of Publishing and Public Notice
Submitted By: City Manager's Office / Kelli Maples