Chapter 3.42
FEE AND SERVICE CHARGE REVENUE/COST COMPARISON SYSTEM
Sections:
3.42.020 Delegation of authority and direction to manager.
3.42.030 Costs reasonably borne – Defined.
3.42.040 Establishment of fees and adoption of percentage of said fees which must be paid.
3.42.010 Findings and intent.
A. It is the intent of the city council in adopting the ordinance codified in this chapter to establish a system whereby the city can charge and collect the reasonable costs it incurs in providing services to those who request or require same. The services, products and/or regulatory activities for which said fees shall be charged are set forth in this chapter.
B. The fee and service charge revenue/cost comparison system set forth in this chapter provides a mechanism for ensuring that fees adopted by the city for services rendered do not exceed the reasonable, estimated cost for providing the services for which the fees are charged.
C. The adoption of the ordinance codified in this chapter is exempt from the California Environmental Quality Act (Public Resources Code Sections 21080 et seq.), because it approves and sets forth a procedure for determining and charging fees for the purpose of meeting the operating expenses of city department, as set forth in Public Resources Code Section 21080(b)(8)(A). (Ord. 692 § 1(part), 1999).
3.42.020 Delegation of authority and direction to manager.
A. The city manager is delegated the authority and directed to provide data and documents to the city council to implement the provisions set forth herein, including but not limited to (1) periodically and regularly reviewing the actual and estimated costs of the city in providing the services, products and regulatory activities (sometimes hereinafter collectively called the “services”) which are the subject of this chapter and (2) where necessary, recommending to the city council adjustments in the fees and the percentage of those fees which should be borne by the persons receiving or requiring said services.
B. The city manager is delegated authority to issue administrative procedures consistent herewith defining terms, setting out administrative, fee collection and financial procedures. All administrative procedures shall be originated and signed by the affected department head, shall be signed by the director of administrative services certifying that the financial requirements of this chapter are complied with, and shall be signed by the city manager connoting the effective date of the administrative procedure.
C. “Costs reasonably borne” are as defined in Section 3.42.030. All administrative procedures issued hereunder shall comply in all respects with this chapter, and the several schedules of fees and rates as set by the city council by resolution. (Ord. 904 § 2, 2021; Ord. 692 § 1(part), 1999).
3.42.030 Costs reasonably borne – Defined.
“Costs reasonably borne,” as used and ordered to be applied in this chapter, consist of the following elements:
A. All applicable direct costs including, but not limited to salaries, wages, overtime, employee fringe benefits, services and supplies, maintenance and operation expenses, contracted services, special supplies and any other direct expense incurred.
B. All applicable indirect costs including, but not restricted to, building maintenance and operations, equipment maintenance and operations, communications expenses, computer costs, printing and reproduction, vehicle expenses, insurance, debt service and like expenses when distributed on an accounted and documented rational proration system.
C. Fixed asset recovery expenses, consisting of depreciation of fixed assets, and additional fixed asset expense recovery charges calculated on the current estimated cost of replacement, divided by the approximate life expectancy of the fixed asset. A further additional charge to make up the difference between book value depreciation not previously recovered and reserved in cash and the full cost of replacement, also shall be calculated and considered a cost so as to recover such unrecovered costs between book value and cost of replacement over the remaining life of the asset.
D. General overhead, expressed as a percentage, distributing and charging the expenses of the city council, city attorney, city manager, city clerk, administrative services department, personnel office, and all other staff and support service provided to the entire city organization. Overhead shall be prorated between tax-financed services and fee-financed services on the basis of said percentage so that each of taxes and fees and charges shall proportionately defray such overhead costs.
E. Departmental overhead, expressed as a percentage, distributing and charging the cost of each department head and his or her supporting expenses as enumerated in subsections A, B, C and F of this section.
F. Debt service costs, consisting of repayment of principal, payment of interest, and trustee fees and administrative expenses for all applicable bond, certificate, or securities issues or loans of whatever nature or kind. Any required coverage factors or required or established reserves beyond basic debt service costs also shall be considered a cost if required by covenant within any ordinance, resolution, indenture or general law applicable to the city. (Ord. 904 § 3, 2021; Ord. 692 § 1(part), 1999).
3.42.040 Establishment of fees and adoption of percentage of said fees which must be paid.
A. The city manager, finance director and each city department head, under the direction of the city manager, shall review annually the fees and service charges and provide an adjusted fee and/or charge schedule to the city council, for its consideration at a duly noticed public hearing, so as to recover the costs reasonably borne for providing those services. The amount of the fees which shall be charged for the provision of the services shall not exceed the reasonable costs incurred by the city in providing those services.
B. Unless otherwise required by state law, the city council shall adopt the fee and service charge schedule by resolution. Said resolution may include an inflationary index that shall allow for administrative inflationary increases; provided, that such increases do not exceed the established index factor. Unless otherwise specified by resolution, the fees and service charges listed in detail in the city’s “Master Fee Schedule” shall be automatically adjusted annually in July for Consumer Price Index (CPI) increase so as to recover the listed percentage of costs reasonably borne necessary to provide the listed regulation, product or service. The CPI increase shall be based on the published CPI for the San Francisco Area (San Francisco – Oakland – San Jose) April Edition, and rounded to the nearest fifty cents unless a different edition or rounding is otherwise specified by resolution.
C. The frequency with which said fees and the percentage share are reexamined may be varied by the city manager so as to allow the city council to adjust revenues sufficient to meet debt service coverage requirements of any bond, certificate, or ordinance, resolution, indenture, contract or action under which securities have been issued by the city which contain any coverage factor requirement. The charges and fees set out in this chapter may be amended or updated by resolution. Resolutions presented to the council may combine the services and their associated fees and charges allowed by this chapter with services and fees provided for in other chapters of this code.
D. In the event that the imposition of a particular fee and/or the payments of the applicable percentage share is determined by the city manager to be unreasonable, the city manager shall report said determination to the city council with accompanying data and documentation at a duly noticed public hearing. The city council may adjust the amount of the fee and/or the percentage share based upon expressed findings that the adjustment is necessary in order to assure that the amount of the fee required to be paid does not exceed the reasonable costs incurred by the city in providing the service for which the fee is imposed. (Ord. 904 § 4, 2021).