I. RECOMMENDATION:
Receive information regarding the City’s fee schedule and provide direction to staff on whether the City Council wishes to consider a Consumer Price Index (CPI)-based adjustment to City fees, which have not been updated since 2023, except for Administrative and Airport fees.
II. BACKGROUND:
City fees are charges imposed on individuals or businesses for specific services provided by the City and are intended to recover the reasonable cost of providing those services. Fees are distinct from taxes and must comply with applicable provisions of the California Constitution, including Propositions 4, 13, 26, and 218.
In 2017, the City completed a fee study prepared by Willdan Financial Services that established the baseline cost-of-service methodology for City fees. In January 2018, the City Council adopted Resolution No. 3789, authorizing annual adjustments to City fees based on the Consumer Price Index (CPI).
While the City has the authority to apply CPI adjustments annually, fee updates have not occurred consistently. The most recent fee increase occurred in 2023 and was limited to Administrative and Airport-related fees. All other City fees have remained unchanged since that time.
III. DISCUSSION:
Staff is bringing this item forward to obtain City Council direction regarding whether to proceed with a CPI-based adjustment only, consistent with the authority previously granted by the City Council, rather than undertaking a comprehensive fee study.
Since 2023, the City has experienced inflationary impacts affecting labor, materials, contractual services, and overhead costs. Applying a CPI-based adjustment is intended to help maintain alignment between existing fees and the underlying cost of providing services, without modifying fee structures, service levels, or cost recovery policies.
At this time, staff is not proposing specific fee amounts or requesting adoption of a resolution. Instead, staff is seeking policy direction on whether the City Council wishes staff to return at a future meeting with a proposed CPI adjustment to applicable fees.
If directed to proceed, staff would:
- Apply a CPI factor consistent with prior Council practice
- Limit adjustments to CPI only, with no structural or methodological changes
- Prepare a resolution and updated fee schedule for City Council consideration
IV. ALTERNATIVES:
The City Council may choose to:
- Direct staff to return with a CPI-based fee adjustment.
- Direct staff to limit CPI adjustments to certain fee categories or departments.
- Issue an RFP for a consultant to conduct a new updated fee study.
- Take no action and maintain the current fee schedule.
V. FISCAL IMPACT:
There is no fiscal impact associated with receiving this report and providing direction.
Any future fiscal impact would depend on the CPI percentage applied and service demand and would be presented to the City Council prior to any action. |