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Monday, March 18 , 2019, 9:28 am | Fair 59º


Ron Fink: User-Fee Changes a Tough Decision for Lompoc Council

On Oct. 6, the Lompoc City Council was presented with a highly detailed 478 page “Cost of Service Study” by the city manager.

Since the council had only received it a couple of days before the meeting, they listened to the staff report and then informed the city manager that they needed more time to digest all this material – a good move on their part since concerned members of the public didn’t have a chance to look it over either.

According to the staff report, “The last comprehensive user-fee analysis approved by the council was adopted on Sept. 3, 1991.”

Things have changed since then and both the type of services provided and the cost of government have risen over time.  

The council has approved some incremental increases in response to changes in the Consumer Price Index, but there hasn’t really been hard look at the actual costs incurred by government.

The city hired a consultant and their report recommended roughly two-thirds of the 170 fees would either be new fees or should be increased – the other third were reduced.

Fees for service, unlike taxes, do not require voter approval, so it’s very important for the council to pay close attention to what is being proposed before they act.

How many of those 14 new environmental-compliance fees are the result of unfunded mandates? Certainly all of the storm- and waste-water related fees fall into this category.

Based on estimated “units of activity” for each of about 170 user fees in fiscal year (FY) 2015, the city’s estimated total annual cost of providing those services would be $8.3 Million.

Under the existing user-fee schedules, the city would receive $5.4 Million for a cost-recovery rate of about 65.2 percent.

That leaves $2.9 million in unrecovered costs that are subsidized by the city through taxes from the General Fund and other revenue sources.

Assuming the same units of activity estimated above for the 170 user fees, the new user-fee schedule would generate about $1,198,200 in additional fee revenues in FY 2016, for a cost recovery rate of about 79.7 percent.

This is lower than a full recovery cost of 100 percent due to areas that are being subsidized based on social, safety or general community welfare, such as recreational activities and programs, public-transit services and specific police and fire service fees.

Some of the fee costs will rise dramatically – for example currently the fee for putting up a temporary sign is $24.70 and under the new schedule it would cost $250.

If you are a fortuneteller, the new fee is triple the old rate plus Department of Justice fees.

Other fees would go down – for example it currently costs $92.80 for a home use permit and under the new schedule it would cost only $60.

Even though I am a member of the Santa Barbara County Taxpayers Association, I realize that some fees are reasonable. However, I question the methodology used to arrive at some of the fee changes.

I am familiar with the city’s planning process, and sometimes we on the Planning Commission have our decisions appealed to the City Council. This is an important citizen right that must be preserved.

Currently the cost for an appeal of a Planning Commission decision to the City Council is $257.80 per appeal – under the new plan it would be $3,446.

This is a flat fee, and it doesn’t take into consideration the scope of the appeal or for that matter how much staff work may or may not be involved in providing support to the council during the appeal process.

A more equitable approach in this case would seem to be to charge an hourly rate so that the cost would more accurately reflect the staff effort to provide the service, since the cost to process an appeal for a large new development would most certainly be higher than that for a sign or home-use permit.

This could have a chilling effect on individual rights and hinder the ability of most folks to challenge decisions, and that the unintended result of the fee change would be to limit the number of appeals, thus infringing on the rights of people to contest decisions they disagree with.

This report is full of analyses, charts, graphs and spreadsheets, and it’s enough to cause nightmares for the common person.

All you council hopefuls out there may want to look at this report and see if this is the sort of thing you want to spend your time doing because to do this right you have to dig through all those pages and convince yourself that the fees are reasonable.

User fees can strangle economic growth, and the council has made growing the economy one of its top priorities.

This may be one of the toughest decisions this group of council members will have to make during their tenure and a poorly thought out decision here could impact the next election.

— Ron Fink, a Lompoc resident since 1975, is retired from the aerospace industry and has been active with Lompoc municipal government commissions and committee since 1992, including 12 years on the Lompoc Planning Commission. He is also a voting member of the Santa Barbara County Taxpayers Association. Contact him at [email protected]. Click here to read previous columns. The opinions expressed are his own.

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