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Home My WebLink About10 - Approval of the Fiscal Year 2021-22 Fee Study Update - PowerPointApril 12, 2022 Item No. 10 �t SEW Fp�� O G Z e.. Cq�/FOF�N�P City Council Meeting April 12, 2022 Types of Fees and Fines Cost Recovery -Based User Fees Fees limited to recovering the cost of providing the service Market Rate User Fees The city can charge whatever price the market will pay (must be competitive) Fees Set by Law Some fees are set by Federal or State law Taxes under Propositions 2A and 26 Certain fees constitute taxes and may not be increased without a vote of the people Fines Fines are not subject to cost recovery rules and may be set by the Council Degree of General vs. Private Benefit Police Services Street Maintenance Park Maintenance Recreation Classes Certain Appe Non -Profit Facility Rental r Zoning and Planning Approval Fire Prevention Inspections Commercial cility Rentals City Council Policy F-4—Revenue Measures The City will establish appropriate cost -recovery targets for its fee structure and will annually adjust its fee structure to ensure that the fees continue to meet cost recovery targets. Newport Beach Municipal Code Section 3.36.030 mandates l00% cost recovery (except for subsidized services identified in the municipal code) City of Newport Beach — Finance Department FA N Fees Last Updated: Fee Changes: 2016 • Increased cost recovery for five programs within the range specified in the NBMC, resulting in various fee increases: Sample Services: • Youth Camps — from 32% to 35% Recreation classes, • Youth After School Programs — from 25% to 27% swim lessons, sport • Preschool Camps & Programs — from 26% to 28% classes, after school • Aquatics Programs —from 20% to 23% programs for • Oasis Fitness Memberships—from 53% to 58% preschool and • Adult Sports—fees have been administratively reorganized to: youths, senior • simplify the presentation services, special • correctly capture all fees related to current operations event permits • ensure each fee listed correlates to the same programmatic area as where the revenue is recorded New Fees: • Natural Resources — seven fees eliminated relating to beach clean-up and None ISOpod special events that are no longer provided • Appeal for Special Event Permits — Modify NBMC Section 3.36.030 to add Net Revenue o% cost recovery for successful applicants and update the existing 50 - Impact: $81,536 95% cost recovery to be for only unsuccessful applicants City of Newport Beach — Finance Department 5 Fees Last Updated: 2o16 Sample Services: Materials use, inter library loans, setup and cleaning fees for meeting room Fee Changes: • Library Cancellation Charge —Reduced from s66 to s56 • Fees have been administratively reorganized and/or updated to align the Schedule of Rents, Fines, & Fees with departmental operations and authorized changes by the Library Board of Trustees: • Materials Use — Best Sellers - Delete • Tech Toys —New fine to correspond to new collection (GoPro camera, synthesizer, audio interface, etc.) rentals, passport Passport Photo — Increased fee from $Zo to $25 and eliminated provision processing and to recover less than Z00% in NBMC Section 3.36.030 photos New Fees: • Per Page Copies from Central Printers — aligning cost recovery in NBMC Section 3.36.030 with Per Page Copies from Self -Service Copiers Net Revenue • Black and White $0.15 Impact: $19,800 • Color $0.45 • Test Proctoring $24 — includes application processing and occasional monitoring at a central workspace City of Newport Beach — Finance Department /� 71 E L Fees Last Updated: 1 Fee Changes: 2020 Fee methodology updated for certain State -mandated inspections to reflect time of Fire Life Safety Specialists in lieu of Fire Captains or Sample Services: Firefighter Paramedics: Inspections, plan • Care Facility 7-99 Clients — Reduce fee from $451 to $226 reviews, operational • Care Facility >99 Clients — Reduce fee from $583 to $442 permits • Commercial Day Care Facility (TutorTime) — Increase fee from $255 to $260 • Hotel/Motel 50-299 Rooms — Increase fee from $255 to $260 • Fee methodology updated for Operational Permits to use approximately 1/3 of the hourly rate of the full Engine Company • Level 1— New or Renewal —Increase fee from x185 to $236 • Level 2 — New or Renewal — Increase fee from $345 to $445 • As a result of refinement of the fee methodology, increased cost recovery New Fees: in NBMC Section 3.36.030 to s00% for all Fire Prevention services • None resulting in various +/- fee changes based on survey of comparable OC fire agencies that yielded: • Nearly all agencies are fully recovering the cost of these services Net Revenue • The City's fees at a s00% cost recovery level are competitive with the Impact: 684,356 other agencies City of Newport Beach — Finance Department 7 • Notary Services — Increase from $2.0 to $2.5 to correspond to the increase authorized by Government Code Section 8211 • 3 New Fees based on actual cost and will utilize the full hourly and burdened rate of personnel: • User Services not otherwise identified • Appeals not otherwise specified: • Applicant Unsuccessful — 50% Cost Recovery • Applicant Successful — o% Cost Recovery • Modify NBMC to authorize the City Manager or Finance Director to waive user fees up to $5,000 per occurrence, which is to be used in limited circumstances City of Newport Beach — Finance Department ^ • Harbor— MAP Renewal for Service Providers s84 -New fee to differentiate between the 2 business types (Service Providers and Charters, Boat Rentals, & Human -Powered Rentals) due to the differences processing times • CDD — new fees for building permit extensions beyond the initial 3 -year time limit • Application for First Extension Request$208 —Building Official review • Application for Subsequent Extension Request(s) $1,379 — Hearing Officer review • PW — RGP Dredging Permit: • No changes proposed due to limited data as a result of the impact invasive algae had on dredging activity • Staff recommends deferring any changes until Public Works fees are City of Newport Beach —Finance Department studied in FY 2 0 23 - 2 4 • Appeals Fees — as part of the FY 2022-23 Fee Study, staff will comprehensively review the appeal fees to include a consistent cost recovery level across all types of appeals: • o% for successful applicants • 50% for unsuccessful applicants • CPI —for fees eligible for CPI increase July 1, 2022 (approved as part of prior fee resolutions), staff recommends a2%increase in lieu of an approximately 8% CPI increase to ensure the applicable cost of service fees do not exceed the actual of providing the user service City of Newport Beach — Finance Department 10 Departmen FY •22-23 Proposed Net Revenue Impact Fire Prevention s84,356 Library s19,800 RSS x81,536 Other Non -Studied Depts. $422,632 Total s6o8,324 • Proposed fee updates will result in approximately s6o8,324 Of additional revenue next fiscal year, primarily due to the new Community Development fees for building permit extensions • This projection does not account for the impact of any fees where volume statistics are unavailable or CPI adjustments for certain fees City of Newport Beach — Finance Department 11 Departrnent,MMM116� JA Proposed Subsidy Fire Prevention,- $0 Library2 $93,529 RSS3 $7,127,417 Other Non -Studied Depts. $494,240 Total $7,715,3-86 1 Excludes the $4,491 subsidy in Attachment A which is due to the City's practice to round down and not a specific policy decision to recover less than s00% of the cost of services. 2Excludes the $24337 for Passport Service in Attachment A since the fee is set by statue and not due to a specific policy decision to recover less than s00% of the cost. Excludes certain other subsidies due to the City's practice to round down and not a specific policy decision to recover less than s00% of the cost of services. 3Excludes approximately s9oo,000 in subsidies in Attachment A for rentals of facilities. These fees are set based on market competitiveness for comparable facility rentals. City of Newport Beach — Finance uepartment 12 • Staff believes that the format of the fee schedule can be simplified • Research format of other agencies • Focus revisions on providing simple, effective communication designed for end users of the City's services • Staff will also evaluate the format of the executive summaries provided to the Finance Committee • An RFP for a new user fee consultant will be advertised in Spring 2022 • Staff will review the most effective presentation delivery methods for fee study update results (including content and formatting) with the selected consultant City of Newport Beach — Finance Department 13 Finance Committee Reviewed Council Review and First Ordinance Reading of Proposed NBMC Changes Council5econd Ordinance Reading/Adopti on of Proposed NBMC Changes F_ Effective date for proposed fee updates and CPI for non -studied departments and rental fees � 2022 Conduct a public hearing, Approve the FY 2021-22 Fee Study Update, and Introduce Ordinance No. 2022-10 City of Newport Beach — Finance Department 14 Questions? City of Newport Beach — Finance Department 15