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FOOk CITY COUNCIL STAFF REPORT
DATE: MAY 2, 2018 PUBLIC HEARING
SUBJECT: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM SPRINGS,
CALIFORNIA, AMENDING CERTAIN PORTIONS OF RESOLUTION NO. 23854,
MODIFYING CERTAIN USER FEES AND CHARGES BY IMPLEMENTING A
CONSUMER PRICE INDEX INCREASE AND ADOPTING THE
COMPREHENSIVE FEE SCHEDULE FOR FISCAL YEAR 2018-19.
FROM: David H. Ready, City Manager
BY: Finance Department
SUMMARY
The City Council will conduct a continued public hearing and take public testimony with respect
to amending certain portions of Resolution No. 23854, modifying certain user fees for City
Departments, implementing a Consumer Price Index (CPI) Adjustment, and modifying the
Comprehensive Fee Schedule for Fiscal Year 2018-19.
RECOMMENDATION:
1. Re-open the continued public hearing and receive public testimony.
2. Adopt Resolution No. "A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF PALM SPRINGS, CALIFORNIA, AMENDING PORTIONS OF RESOLUTION NO.
23854, MODIFYING CERTAIN USER FEES AND CHARGES BY IMPLEMENTING A
CONSUMER PRICE INDEX INCREASE AND ADOPTING THE COMPREHENSIVE
FEE SCHEDULE FOR FISCAL YEAR 2018-19."
STAFF ANALYSIS:
Local governments are funded from a variety of sources, with the primary sources being taxes,
subventions, fees, special charges, fines and grants. As the traditional provider of basic
services, cities are relying more and more heavily on fees that are charged for various public
services.
Generally, State Law requires that fees charged by local agencies not exceed the reasonable
estimated cost of providing the service. User fee services are those services performed by a
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ITEM t �,_�.
City Council Staff Report
April 18, 2018-- Page 2
Comprehensive Fee Schedule
governmental agency on behalf of a private citizen or group. The assumption underlying most
fee recommendations is that the cost of services benefiting individuals, and not society as a
whole, should be borne by the individual(s) receiving the benefit(s).
In 2013, the City retained a consulting firm, Capital Accounting Partners, to prepare a User
Fee Study. This study was prepared to ensure that the City was recovering the full cost of
providing various public services and that fees were based upon the estimated reasonable
cost of providing the type of service for which the fee is charged. Fees were substantially
updated in 2015 to reflect the costs of providing those services as outlined in the report.
It is the City's intent to retain a consulting firm approximately every five-years to prepare an
updated comprehensive User Fee Study and thoroughly review all fees. These time/material
studies and overhead calculations and allocations are expensive and very time-consuming for
staff. During the interim, each year all fees are to be increased (or decreased) by a CPI index.
This ensures fees remain reasonably related to costs and keep pace with increased costs
without having to prepare a comprehensive study each year. (Note: A Request for Proposals
to perform a study for FY 2019-20 has been issued and proposals are due by April 24, 2018.)
Resolution No. 23854, unanimously adopted by the City Council on July 15, 2015, provides for
annual fee adjustments. However, the automatic adjustment mechanism in Section 2.D. of
Resolution No. 23854 is not indexed to CPI. It has been determined, based upon discussions
with the Desert Valley Builders Association, that for FY 2018-19, effective July 1, 2018, most
fees shall be adjusted 2.5% based upon CPI-U, West B/C. For Fiscal Year 2018-2019 and
future years, the automatic adjustment mechanism in Section 2.D. would be repealed, and
future increases for most fees would either be based upon CPI or a new fee/cost study.
However, some fees are not subject to a CPI increase for various reasons such as: the fee
having been set by contractual requirements of the City, the fee having been set by another
Agency and only being collected by the City, or the fee being at a maximum allowable under
law. To the extent that the Resolution proposed for adoption in this matter is inconsistent with
Resolution No. 23854, this new Resolution supersedes the older approval.
Parks and Recreation fees were also increased by 2.5%. However, per City Council direction,
at an upcoming meeting, staff will be presenting a recommendation from the Parks and
Recreation Commission to adopt fees adjusted based upon a more comprehensive fee
structure modification. An additional comprehensive fee study and resolution forthcoming on or
before June 6, 2018, will be based upon and provide for at least a partial recovery by the City
of its permit issuance, administration, testing, and enforcement costs arising from regulation of
cannabis businesses and activities pursuant to Ordinance 1933, codified in Chapters 5.45 and
5.55 of the Palm Springs Municipal Code.
Additionally, each year the Departments, review the current fee schedule and may recommend
minor modifications to the wording and description of certain fees and charges.
Pursuant to the Fee Mitigation Act codified at 66000 et seq. of the California Government
Code, in order to adopt building, zoning and other development fees subject to the Act, the
City Council must make two factual findings in approving the proposed Resolution:
002
City Council Staff Report
April 18, 2018-- Page 3
Comprehensive Fee Schedule
First, the Council must find that City revenues during FY 2017-18 from fees for services
subject to the Mitigation Fee Act, and reflected in the Comprehensive Fee Schedule as
previously adjusted, did not exceed the actual cost of providing the services for which the
fees were collected.
Second, the Council must find that City revenues during FY 2018-19 from fees for services
subject to the Mitigation Fee Act, and reflected in the Comprehensive Fee Schedule, do not
exceed the estimated amount of funds required to provide the services for which they will
be charged.
In effect, the City must find that it is not making a "profit' from providing these services. In
point of fact, the Finance Director/Treasurer advises that throughout his ten (10) years of
service to the City, the City has never fully recovered its costs of providing any services subject
to the Mitigation Fee Act through fees imposed for those services.
FISCAL IMPACT:
All proposed modifications to fees were incorporated in the Fiscal Year 2018-19 Budget. The
CPI increase to current fees of 2.5% will result in an increase in projected General Fund
revenue of approximately $250,000.
GEOFFREY S. KIEHL DAVID H. READY
Director of Finance and Treasurer City Manager
EDWARD Z. KOTKIN
City Attorney
Attachments:
Proposed Resolution (with Attachment indicating exclusions)
Proposed Comprehensive Fee Schedule
Notice of Public Hearing
G03
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
PALM SPRINGS, CALIFORNIA, AMENDING PORTIONS
OF RESOLUTION NO. 23854, MODIFYING CERTAIN
USER FEES AND CHARGES BY IMPLEMENTING A
CONSUMER PRICE INDEX INCREASE AND ADOPTING
THE COMPREHENSIVE FEE SCHEDULE FOR FISCAL
YEAR 2018-19.
WHEREAS, the City, under various statutory provisions under California
Government Code, may set and collect fees for the costs of providing various public
services to the community; and
WHEREAS, the City Council approved by Resolution No. 23854 an updated
Comprehensive Fee Schedule on July 15, 2015, approving certain amendments to said
service fees; and
WHEREAS, Section 2.D. of Resolution No. 23854 provided for service fees and
charges to be adjusted annually by a percentage increase or decrease in said fees
based upon the corresponding calculated change in the City's annual personnel costs
for performing those services; and
WHEREAS, based upon discussions between the City and the Desert Valley
Builders Association for FY 2018-19, the City will not utilize the automatic adjustment
mechanism in Section 2.D., but instead will utilize the Department of Labor's Consumer
Price Index for February 2017 versus February 2018, CPI-U, West — B/C, to calculate
the amount of change in said user fees, and that change is an increase of 2.5%; and
WHEREAS, this adjustment to the Comprehensive Fee Schedule modifies
certain development fees, permit fees, and/or regulatory fees that are subject to the
Mitigation Fee Act, codified at California Government Code (CGC) §66000 et seq., and
more specifically in accordance with CGC §66016, §66013, or §66014, and the City, in
considering this modification, is adhering to the procedures of CGC §66016(a);
WHEREAS, notice of an April 18, 2018 Public Hearing and the 2.5% CPI
increase was published, posted and distributed on April 5, 2018, in accordance with the
provisions of the California Government Code;
WHEREAS, the April 18, 2018 public hearing was opened and then continued to
May 2, 2018;
WHEREAS, City revenues during FY 2017-18 from fees for services subject to
the Mitigation Fee Act, and reflected in the Comprehensive Fee Schedule as previously
adjusted, did not exceed the actual cost of providing the services for which the fees
were collected;
004
Resolution No.
Page 2
WHEREAS, City revenues during FY 2018-19 from fees for services subject to
the Mitigation Fee Act, and reflected in the Comprehensive Fee Schedule adopted
pursuant to this Resolution, do not exceed the estimated amount of funds required to
provide the services for which they will be charged;
WHEREAS, this Resolution reflects the City's discussions with the Desert Valley
Builders Association, and to the extent that this Resolution is inconsistent with
Resolution 23854 approved on July 15, 2015, this Resolution shall supersede and
amend Resolution 23854;
WHEREAS, by adopting this Resolution, the City Council is also articulating the
City's policy for considering adjustments to the Comprehensive Fee Schedule in FY
2018-2019 and in future years; and
WHEREAS, the City Council has considered any verbal and/or written testimony,
and has reviewed and considered the information in the study and supporting data, and
information provided at the public hearing by staff and the public.
THE CITY COUNCIL OF THE CITY OF PALM SPRINGS, CALIFORNIA,
HEREBY RESOLVES, DETERMINES AND APPROVES AF FOLLOWS:
A. The true and correct recitals above are incorporated by this reference
herein as the basis and foundation for the City's adoption of this Resolution.
B. Section 2.D. of Resolution 23854 is hereby repealed, effective for all fee
adjustments in Fiscal Year 2018-2019 and future fiscal years.
C. For Fiscal Year 2018-2019, all fees in the Comprehensive Fee Schedule
shall be increased by two and one-half percent (2.5%) over Fiscal Year 2017-2018
rates.
D. All new fees and charges subject and pursuant to California Government
Code Section 66000 of seq. shall be effective not earlier than sixty (60) days after the
adoption of this resolution.
E. All new fees and charges other than those identified in section D above
shall be effective July 1, 2018.
F. The Director of Finance is hereby authorized and directed to incorporate
said increased to fees and charges into the Comprehensive Fee Schedule.
G. The City Council hereby declares the following as the City's policy for
consideration of the Comprehensive Fee Schedule in Fiscal Year 2018-2019 and for
future years, to ensure compliance with the Mitigation Fee Act and other applicable law:
005
Resolution No.
Page 3
(1) The annual Comprehensive Fee Schedule utilized by the City shall be
considered and acted upon by the City through a Fee Resolution directed solely
and specifically to the Comprehensive Fee Schedule.
(2) Insofar as the Comprehensive Fee Schedule contains development fees,
permit fees, and/or regulatory fees that are subject to Government Code §66016,
§66013, or §66014, the City shall follow the procedures of §66016(a) for the Fee
Resolution, including but not limited to provision of notice of hearing on the Fee
Resolution at least 14 days in advance of the hearing, and making available to
the public 10 days in advance of the hearing the data indicating the amount of
the cost, or estimated cost, required to provide the service for which the fee is
collected and the revenue sources anticipated to provide the service, including
General Fund revenues.
(3) Insofar as the Comprehensive Fee Schedule contains development fees,
permit fees, and/or regulatory fees that are subject to Government Code §66016,
§66013, or §66014, the Fee Resolution shall contain —and the City Council must
approve—a factual finding that each of said fees do not exceed the estimated
amount required to provide the services for which they will be charged under the
Fee Resolution and Comprehensive Fee Schedule.
(4) Insofar as the Comprehensive Fee Schedule contains development fees,
permit fees, and/or regulatory fees that are subject to Government Code §66016,
§66013, and/or §66014, the Fee Resolution shall contain —and the City Council
must approve— as to each of said fees either (1) a factual finding that the
revenues in the last fiscal year did not exceed the actual cost of providing
services for which the fee was collected, or (2) determine the excess of revenues
over actual cost collected from that fee has collected and direct that the excess
revenue be applied to reduce the fee or service charge creating the excess in
subsequent fiscal years.
(5) Insofar as the Comprehensive Fee Schedule contains development fees,
permit fees, and/or regulatory fees that are subject to Government Code §66016,
§66013, and/or §66014, and given that Government Code §66017 provides for a
60 day delay in the effective date after approval of said development fees, the
Fee Resolution shall as a matter of scheduling and as a condition for the
referenced development fees to be effective on the same preferred date of July 1
each year, along with all the non-development fees in the Comprehensive Fee
Schedule, be set for hearing by the City Council more than 60 days before the
planned July 1 effective date of the entire Comprehensive Fee Schedule. For
the Fiscal Year 2018-2019 Comprehensive Fee Schedule, the fees will become
effective on July 2, 2018.
006
Resolution No.
Page 4
(6) The City Council reserves its discretion to consider and adopt, as the City
Council sees fit, any increase in fees reflected on the Comprehensive Fee
Schedule for Fiscal Year 2019-20 and future years based upon either:
(i) the annual percent change in the Index for a month of the current
year contrasted against the same month of the prior year; or
(ii) a comprehensive fee study secured by the City, prepared,
considered and relied upon during the City's consideration of the fee increase.
The only limit upon the City Council's discretion in considering and
adopting fee increases shall be its policies in Resolution No. 23854 as amended,
compliance with the Mitigation Fee Act and other applicable law. The City's
process of securing and developing a fee study, and considering and adopting
any such future fee increases shall be consistent with the policy set forth in this
Section G.
PASSED, APPROVED, AND ADOPTED BY THE PALM SPRINGS CITY
COUNCIL THIS 2nd DAY OF MAY, 2018.
DAVID H. READY, CITY MANAGER
ATTEST:
ANTHONY J. MEJIA, MMC, CITY CLERK
007
Resolution No.
Page 5
CERTIFICATION
STATE OF CALIFORNIA )
COUNTY OF RIVERSIDE ) ss.
CITY OF PALM SPRINGS )
I, ANTHONY J. MEJIA, City Clerk of the City of Palm Springs, hereby certify that
Resolution No. is a full, true and correct copy as was duly adopted at a regular
meeting of the City Council of the City of Palm Springs on April 18, 2018, by the
following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
ANTHONY J. MEJIA, MMC, CITY CLERK
City of Palm Springs, California
Dub
CITY OF PALM SPRINGS
PUBLIC NOTIFICATION
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Date: April 18, 2018
Subject: Modifications to the Comprehensive Fee Schedule
AFFIDAVIT OF PUBLICATION
I, Cynthia A. Berardi, CMC, Chief Deputy City Clerk, of the City of Palm Springs, California,
do hereby certify that a copy of the attached Notice of Public Hearing was published in the
Desert Sun on April 7, 2018.
1 declare under penalty of perjury that the foregoing is true and correct.
A,
Cynthia A. Berardi, CMC
Chief Deputy City Clerk
AFFIDAVIT OF POSTING
I, Cynthia A. Berardi, CMC, Interim Chief Deputy City Clerk, of the City of Palm Springs,
California, do hereby certify that a copy of the attached Notice of Public Hearing was
posted at City Hall, 3200 E. Tahquitz Canyon Drive, on the exterior legal notice posting
board, and in the Office of the City Clerk on April 5, 2018.
1 declare under penalty of perjury that the foregoing is true and correct.
Cynthia A. Be rdi, CMC
Chief Deputy City Clerk
O09
CITY COUNCIL
CITY OF PALM SPRINGS
NOTICE OF PUBLIC HEARING
COMPREHENSIVE FEE SCHEDULE
NOTICE IS HEREBY GIVEN that the City Council of the City of Palm Springs,
California, will hold a public hearing at its meeting of April 18, 2018. The City Council
meeting begins at 6:00 PM, in the Council Chamber at City Hall, 3200 E. Tahquitz
Canyon Way, Palm Springs.
The purpose of this hearing is to solicit public comments and consider the proposed
modifications to user fees and charges prior to the adoption of a Resolution revising and
updating the City's Comprehensive Fee Schedule, and to include a 2.5% CPI increase
to certain fees previously authorized by the City Council. Under state law all fees
charged by the City must be reasonably related to the actual cost of providing various
public services.
REVIEW OF INFORMATION: The staff report and other supporting documents
regarding this are available for public review at City Hall between the hours of 8:00 a.m.
and 6:00 p.m. Monday through Thursday. Please contact the Office of the City Clerk at
(760) 323-8204 if you would like to schedule an appointment to review these
documents.
COMMENTS: Response to this notice can be made verbally at the Public Hearing
and/or in writing before the hearing. Written comments can be made to the City Council
by letter (for mail or hand delivery) to:
Anthony J. Mejia, City Clerk
3200 E. Tahquitz Canyon Way
Palm Springs, CA 92262
Any challenge of the proposed project in court may be limited to raising only those
issues raised at the public hearing described in this notice, or in written correspondence
delivered to the City Clerk at, or prior to, the public hearing. (Government Code Section
65009(b)(2)).
An opportunity will be given at said hearing for all interested persons to be heard.
Questions regarding this case may be directed to Geoffrey S. Kiehl, Director of Finance
and Treasurer, at (760) 323-8229.
Si necesita ayuda con esta carta, favor de Ilamar a la Ciudad de Palm Springs y
comuniquese con Ariana Muniz al (760) 323-8229.
A ony a is
City Clerk
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Deborah McGarrey, Public Affairs Desert Valley Builders BIA
Manager Association Riverside County Chapter»
Sempra Utilities 75100 Mediterranean 3891 11th Street
75095 Mayfair Drive Palm Desert, CA 92211 Riverside, CA 92501
Palm Desert, CA 92211-5102
Oil
PAL
- City of Palm Springs
Office of the City Clerk
3200 E.Tahquitz Canyon Way • Palm Springs, California 92262
Tel: 760.323.8204 • Fax: 760.322.8332 •TDD 760.864.9527 •www.paimspringsca.gov
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NOTICE OF CONTINUANCE
NOTICE IS HEREBY GIVEN that the Regular Meeting held on April 18, 2018, the
City Council continued Public Hearing Item No. 2.D. to May 2, 2018:
2.D. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM SPRINGS,
CALIFORNIA, MODIFYING CERTAIN USER FEES AND CHARGES BY
IMPLEMENTING A CONSUMER PRICE INDEX INCREASE AND ADOPTING THE
COMPREHENSIVE FEE SCHEDULE FOR FISCAL YEAR 2018-19:
ACTION:
1. Continue the Public Hearing to May 2, 2018, with no public testimony at this time.
2. Direct the City Clerk to post a Notice of Continued Public Hearing pursuant to law.
I, Cynthia A. Berardi, Chief Deputy City Clerk of the City of Palm Springs, California, certify this
Notice of Continuance was posted at or before 7:00 p.m. on April 19, 2018, as required by
established policies and procedures.
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CYNTHWA. BERARDI, CMC
Chief Deputy City Clerk
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Post Office Box 2743 • Palm Springs, California 92263-2743