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1 DATE: March 24, 2025
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: Nate Cruz, 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 2025-2026
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 2025-2026 budget.
EXECUTIVE SUMMARY
City/District staff is recommending changes to the Master Fees and Service Charges Schedule (“Schedule”). A 2.4% 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 2024 Consumer Price Index (CPI) for the San Francisco area.
There are separate reports that will be presented at the March 24 Budget Study Session seeking EMID Board’s approval of proposed utility rate increases for Proposition 218 noticing.
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1 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 Schedule and publish the proper notices for a public hearing to be held at the April 21, 2025 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, 2025. 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 2025-2026 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 2.4% 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 2.4% is based on the December 2024 Consumer Price Index (CPI) for the San Francisco area. Building fees are subject to 2.3% inflation increase based on 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
Under separate reports that will be presented at the March 24 Budget Study Session, the EMID Board will review a Water and Wastewater Rate Analysis. Based on the Board’s direction for those items, staff will proceed with a Proposition 218 notice (minimum 45 days in advance of a public hearing) of the recommended rates for a June 2, 2025 public hearing.
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1 Community Development Department Fees
In addition to the 2.3% BCI increase for most fees for the Building Division and 2.4% CPI-U increase for most flat fees related to Planning, the Community Development Department is proposing the following revisions to the master fee schedule:
•Building division: Adding new fees for change of occupancy and flat fees for common residential permits, including window replacements, door replacements, re-roofs, pool demos, EV chargers, furnace/water heater replacement, and relocation.
•Planning division: Increasing the deposit amount for Appeals; adding new fees for Senate Bill (SB) 9 units, Assembly Bill (AB) 1332 ADU plans and Pre- Reviewed ADU/JADU Plans; and Tobacco Retail Permits.
See Attachment 2 for details.
Finance Fees
The Finance Department is proposing to add a flat $75 lien filing fee. This fee will offset some of the expenses associated with the City/District’s effort to collect unpaid utility balances or other unpaid amounts.
Parks and Recreation Department Fees
The Parks and Recreation Department is proposing: 1) various fee increases for facility rentals, 2) modifications to the reservation options to expand, clarify, and simplify reservations, and 3) establish new fees. These adjustments are presented in Attachment 3.
Public Works Department Fees
In addition to the 2.4% general increase for most fees, the Public Works Department recommends increasing the deposits related to the existing items under “PWWA-07 Temporary Hydrant Meter Application Fee & Deposit” and “PWWA-08 Water Deposit” to more successfully recover costs associated with the issuance of temporary water meters.
California Environmental Quality Act
Not Applicable
FISCAL IMPACT
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1 If the revised Master Fees and Service Charges Schedule is adopted on April 21, 2025, there will be a slight positive fiscal impact in permit/fee revenues from the proposed changes.
CITY COUNCIL VISION, MISSION, AND VALUE/PRIORITY AREA
Innovation and Sustainability
ATTACHMENTS
Attachment 1 – Proposed Master Fees and Service Charges Schedule for FY 2025- 2026
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