DATE: March 25, 2024
TO: Mayor and Members of the City Council President and Members of the Estero Municipal Improvement District (EMID) Board of Directors
VIA: Stefan Chatwin, City/District Manager
Marlene Subhashini, Assistant City/District Manager
FROM: Edmund Suen, Finance Director
Waqas Hassan, Assistant Finance Director
Mimi Lam, Financial Services Manager
DEPARTMENT: Finance
SUBJECT: UPDATES TO MASTER FEES AND SERVICE CHARGES
SCHEDULE FOR FY 2024-2025
RECOMMENDATION
It is recommended that the City Council/EMID Board, by Minute Order, provide policy direction regarding changes to the Master Fees and Service Charges Schedule as part of the FY 2024-2025 budget.
EXECUTIVE SUMMARY
City/District staff is recommending changes to the Master Fees and Service Charges Schedule (“Schedule”). A 2.6% increase in most fees is recommended as cost recovery for increases in personnel costs and service and supply costs that support the provision of services. This increase is based on the December 2023 Consumer Price Index (CPI) for the San Francisco area.
In addition, the Community Development Department is proposing the following: 1) addition of new fees to recover cost of staff time for Alternate Method and Material Request (AMMR), processing new addressing requests, Permit extension requests, Temporary Certificate of Occupancy (TCO) request, fee for signage violations, and for construction plans revision reviews; 2) revision of Express Plan Check fee and Penalty
Fee; 3) update the footnote for Deposit-based fees and add deposit amounts for subdivision mapping; and 4) establishment of a BMR compliance and monitoring fee schedule. The fee schedule would consist of an annual monitoring fee and compliance fees that comprises of penalties on a per property and/or per unit basis that would be assessed for non-cooperation with staff enforcement efforts or continued or repeated non-compliance.
The Parks and Recreation Department is proposing: 1) increase in Community Center Rental fees and Park reservation rates by 5%; 2) addition of new reservation fees for basketball courts and Community Garden; 3) addition of new material-based fees; 4) to temporarily remove Recreation Center rooms’ rental fees; and 5) to add temporary modular units to Facility reservations.
Furthermore, the Public Works Department is proposing to add: 1) a $1,000 deposit and actual cost associated with the review of Water Neutrality Ordinance Compliance; and 2) a deposit of $250 to the existing item “PWE -08 - PW Research” which is charged at actual cost.
There is also a separate report tonight seeking EMID Board’s approval of proposed water rate increases for Proposition 218 noticing.
BACKGROUND
As part of the annual budget process, the City Council/EMID Board reviews the Master Fees and Service Charges Schedule. The schedule includes all services and charges that are charged by the City/District in providing services to the community. Fees such as building permit fees, encroachment permits, inspections, fingerprinting, water meters, copying and duplication charges are examples of the type of fees charged to residents and businesses. The schedule is subject to a public hearing prior to adoption.
The City Council/EMID Board has historically reviewed the schedule as part of its annual Budget Study Session. Based on City Council/EMID Board direction, City/District staff will prepare the necessary staff report regarding changes to the Master Fees and Service Charges Schedule and publish the proper notices for a public hearing to be held at the April 15, 2024 regular meeting. At the conclusion of the public hearing, the City Council/EMID Board then adopts the Master Fees and Service Charges Schedule, which goes into effect on July 1, 2024. In accordance with State law, all service-related fees are to be based upon the cost of providing such services.
The basis for many of the fees in the Schedule is from the cost allocation plan and fee study that was performed in 2023 and adjusted annually for normal cost escalation and inflation incurred by the City/District.
ANALYSIS
The proposed Master Fees and Service Charges Schedule for FY 2024-2025 is provided in Attachment 1 and includes proposed staff billing rates for fees that are calculated on a time and materials basis.
Overall Increases
The recommendation is that most fees be raised by 2.6% based on the higher costs of providing services by the City/District; which is driven primarily from increased personnel costs, as well as the cost of supplies and services that support the delivery of those services to the community. This rate increase of 2.6% is based on the December 2023 Consumer Price Index (CPI) for the San Francisco area. Building fees are subject to annual adjustment to account for annual inflation based on prior year annual % (i.e.
FY 24-25 increase will be based on 2023 Annual %) construction cost data from the Building Cost Index (BCI) published by the California Department of General Services, Real Estate Services Division.
Utility Rates – Water and Wastewater Services
In a separate report this evening, the EMID Board will review a Water and Wastewater Rate Analysis. Based on the Board’s direction for that item, staff will proceed with a Proposition 218 notice (minimum 45 days in advance of a public hearing) of the recommended rates for a June 3, 2024 public hearing.
Community Development Department Fees
In addition to the 2.6% general increase for most fees related to Planning and 9.6% for fees related to Building, the Community Development Department is proposing the following the following revisions to master fee schedule:
•Building division:
oaddition of new building permit fees to recover cost of staff time for Alternate Method and Material Request (AMMR), processing new addressing requests, Permit extension requests, Temporary Certificate of Occupancy (TCO) request, and for construction plans revision reviews; and orevision of Express Plan Check fee and Penalty Fee for work without permits.
•Planning division:
oadding deposit amounts for Subdivision Map fees; and
oadding fee for signage violations.
•Affordable Housing:
oMonitoring fees; and
oCompliance fees
Note that revenues from BMR Compliance and Monitoring Fees would be allocated to Affordable Housing Funds 122 and 124. A detailed explanation of each of these new fees is provided in Attachment 2.
Parks and Recreation Department Fees
The Parks and Recreation Department is proposing: 1) increase in Community Center Rental Fees and Park reservation rates by 5%; 2) addition of new reservation fees for basketball courts and Community Garden; 3) addition of new material-based fees at various facility rentals; 4) to temporarily remove Recreation Center rooms’ rental; and 5) to add temporary modular units to Facility reservations. These adjustments are presented in Attachment 3.
Public Works Department Fees
In addition to the 2.6% general increase for most fees, the Public Works department is proposing to add: 1) a $1,000 deposit and actual cost associated with the review of Water Neutrality Ordinance Compliance; and 2) and a deposit of $250 to the existing item “PWE -08 - PW Research” which is charged at actual cost.
California Environmental Quality Act
Not Applicable
FISCAL IMPACT
If the revised Master Fees and Service Charges Schedule is adopted on April 15, 2024, there will be a slight positive fiscal impact in permit/fee revenues from the proposed changes. However, given that most of these fee increases will allow the City to recover costs for staff time and resources, the net fiscal impact may be negligible.
CITY COUNCIL VISION, MISSION, AND VALUE/PRIORITY AREA
Innovation and Sustainability
ATTACHMENTS
Attachment 1 – Proposed Master Fees and Service Charges Schedule for FY 2024- 2025
Attachment 2 – Community Development Recommended Changes to its Fees and Charges
Attachment 3 – Parks and Recreation Recommended Changes to its Fees and Charges
Attachment 4 – Public Works Recommended Changes to its Fees and Charges