Agenda Item Wording:
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Fiscal Year 2024-25 Rates and Fees - Receive, review, and discuss proposed new fees, increases, and adjustments to the City’s Rates and Fees Schedule for Fiscal Year 2024-25.
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Deadline for Action: 6/3/2024
Submitting Department: Finance and Technology Services
Contact Name and Phone Number: Jana Ferguson 559-713-4429, jana.ferguson@visalia.city; Renee Nagel 559-713-4375, renee.nagel@visalia.city
Department Recommendation:
It is recommended that the City Council receive, review, and discuss the proposed new fees, increases, and adjustments to the City’s Rates and Fees Schedule for Fiscal Year 2024-25.
Background Discussion:
Annually, all City’s fees, except Impact Fees and Business Tax, are reviewed for annual cost of living adjustments for the upcoming fiscal year. Annual inflationary adjustments help Departments cover costs and lessen the burden on the General Fund so that the fund will be available to cover critical operations including public safety. Per City ordinances, Impact Fees and Business Tax fees are adjusted annually by specific CPI indices.
There are two meetings to review the Rates and Fees for Fiscal Year 2024-25. The first meeting, on June 3rd, is for presentation and discussion only; to receive, review, and discuss the proposed changes to the City’s Rates and Fees Schedule. The second meeting, on June 17th, is to conduct a Public Hearing and take action to adopt the City’s Rates and Fees Schedule for Fiscal Year 2024-25. If approved, the effective date is July 1, 2024, for all rates and fees except Impact Fees which require a 60-day notice making the effective date for these fees August 17, 2024.
Fee increases are based on established indexes. The City uses the California Consumer Price Index for All Urban Consumers (CCPI-U) as the basis for most fee adjustments. Impact Fees are required by City ordinance to use a building industry index known as the Engineering News Record Construction Cost Index (ENRCCI). In a like manner, City ordinance dictates that the Business Tax will be adjusted by the CPI using the US City Average for all items (USCPI-U) using the average for the most recent 3 years. Both Impact Fees and Business Tax fees are adjusted annually as directed by ordinance. Each Index and the fee effective date are listed in Table 1: Proposed Index Period Changes.
This report explains in detail the following fee changes:
• New Fees
• Fee Increases Exceeding CPI
• Adjusted Fees
• Existing Fees - Previously Not Listed in the Document
• Deleted Fees
All existing rates and fees that are only increasing by CPI, ENRCCI (Impact Fees), and USCPI-U (Business Tax fees) are not listed in the staff report. These rates and fees are listed in the Proposed Rates and Fees FY 2024-25 document which is attached. For comparison purposes, the document includes the current fiscal year’s rates and fees.
Throughout the Rates and Fees document, there are times when some or all of the departments’ Rates and Fees are not increased for specific circumstances and reasons. The following are instances of when rates and fees might not be increased.
• Ordinance and Fees set by other Governmental Agencies. Some fees may require an ordinance change in order to change such as Code Enforcement fees. Some fees may be set by other governmental agencies and therefore may not be changed as in the case of some Police Fees and Passport Application Fees (located in General Government and Finance Fees).
• Legal Requirements (Prop. 218 Fees) - Some fees may require the Department to go through a Prop. 218 notification process before they can be increased as in the case of Solid Waste and Sewer Fees.
• Contracted - Some fees are based on contracted services charged at contracted prices and therefore, are being increased as in the case of Sidewalk and Drive Approach Improvements fees.
• Minor Administrative Fees - Some fees are for minor administrative tasks that are minimal and/or rarely occur and are therefore not being increased as in the case of copy fees, payroll fees, and report fees.
• Department - Some fees are not being increased per the department’s recommendation. For instance, a department may want to remain competitive within their industry so an increase in fees could be detrimental to their business. Some departments use set guidelines for service offerings and pricing. As an example, The Parks & Recreation department has set a policy and philosophy for the way they calculate all program fees. The overriding goal of this policy is to offer year-round, diversified programs and services at reasonable and equitable rates. This policy and philosophy are examined and adjusted as needed to stay up to date. The Parks & Recreation Department is currently experiencing a vacancy in the Department Head position, so there are no policy changes with the publishing of this document, but as the interim Department Head and eventual, new Department Head work with staff, it is anticipated that this policy and philosophy will be updated and presented to Council later this year.
• In addition, a department may hold off on increasing or changing fees to better examine the basis on which their fees are determined. The Building Safety Division is a department that felt they needed such review and therefore has no changes this year except for the addition of new, adjusted, and deleted fees as outlined in this staff report. For the eighth consecutive year, the Building Safety Division has completed an analysis of its fees and is not recommending an increase of permit fees for fiscal year 2024-25 as the Building Safety Division continues to maintain a positive fund balance. The Building Safety division was recently consolidated with Engineering to become the new Engineering and Building Department, overseen by a new director. The department is moving forward with an RFP for a consultant to conduct a comprehensive fee study in fiscal year 2024-25. The fee study will evaluate the current fee structure and determine if adjustments to the rates and fees are necessary. Any study will be done in coordination with the development community to determine which permit fees can be consolidated, removed, or edited. It is important to note that while fees have been frozen for many years, the division is operating at optimum levels and is not in a budget deficit condition. As such, a comprehensive fee study is not anticipated to suggest excessive fee increases. In all cases, any future fee adjustments will ensure appropriate annual increases so as not to negatively impact the community.
NEW FEES
The following are proposed new fees for the upcoming fiscal year, effective July 1, 2024. Note: The page numbers referenced for each fee refer to the page number in the Proposed Rates & Fees Document, which is attached.
Enterprise Fees - Animal Services
Animal Services received the California All Animals grant from UC Davis which provides animal tags to citizens reclaiming or adopting pets to help keep them united in the future. The cost for a resident to purchase an Engraved Dog Tag (pg. 45) has been added. This service allows Animal Services to ensure that our citizens have everything they need for their newly adopted or reclaimed pets. While the proposed cost for the engraved tags does not fully cover employee and product costs, the rate has been chosen to keep the City competitive with other vendors offering this service and recognizing the fact that the time spent in the field by our Animal Control officers will be decreased with the presence of animals with these identifying tags making it easier to locate pet owners and reunite them with their animals, therefore creating saving costs for the division. This process could also lead to fewer animals in our shelter waiting to be reunited with their owners.
Animal Services occasionally sees the intake of animals beyond cats and dogs. These have been received with no existing Adoption (pg. 45) rates. The proposed rates are based on the same cost factors as our current adoption rates without the additional vaccination fees since vaccinations aren’t given for animals in these new categories.
Enterprise Fees - Building Safety
A new tiered fee for Photovoltaic Systems (pg. 48) has been added for plan check and inspection to include Residential systems that applied for their permit using SolarApp+. The SolarApp+ permit is a new record type required by the State of California in order to ensure solar permit applications are processed as quickly as possible. This system was required to go into effect no later than September 30, 2023, which the City successfully met. The SolarApp+ permit is processed through a 3rd party plan review system and bypasses the City’s traditional plan check process. Instead, the COV Building Inspection team utilizes an inspection checklist, provided by the SolarApp+ 3rd party system to review and inspect the solar system being installed in the field. The fees associated with the SolarApp+ permit have been reduced to coincide with a reduced plan check process; the plan check fee is half of the normal plan review fee for a residential solar permit.
There is a new fee for EV Charger Systems (pg 48) this year. The 2023 California Building Code update has increased the requirements for Electric Vehicle Charging (EVC) systems. In order to better assess fees on EVC systems greater than six (6) chargers, the Building Safety division is proposing to charge plan review and inspection fees commensurate with the hours spent in plan review and inspection for these systems on a “per charger” basis.
Enterprise Fees - Transit
A new discounted fee for the 31 Day TPASS - ADA Certified/Senior/Disabled/Military (pg. 72) has been approved by the Tulare County Association of Governments (TCAG). The TPASS fees are determined by TCAG and are included in our Rates & Fees because the passes are available to purchase at our Transit Center. The passes are good for the Visalia Transit and TCRTA buses. This discount has been available with all other ticket purchases, but until now, was not available for the 31-day pass.
FEE INCREASES EXCEEDING CPI
Business Tax - General Fund
The annual increases, authorized by City ordinances, are based on the three-year average of the Consumer Price Index for All Urban Consumers (CPI-U) - U.S. City Average which is 5.61%. The following Business Tax Fees (pg. 11-12) have been increased above the CPI due to rounding to the nearest dollar for cash handling purposes. The rate increases range from 5.64% to 5.88% and amounts over CPI range from $0.08 to $0.46.
Neighborhood Preservation - General Fund
The Special Events Application Fee (pg. 25) is increasing because this fee technically issues an Encroachment Permit to the requestor which is a fee set by the Planning and Community Preservation Department for any type of encroachment. The fees have not matched in the past years and this change is being proposed now for consistency. The rate increases 41.38% and $26.48 over the CPI increase.
Parks & Recreation - General Fund
The Parks & Recreation management team took an in-depth look at the calculation factors for Indoor Facility Fees (pg. 18) and have made some adjustments. Capacities were evaluated and corrected to provide renters with more accurate numbers when selecting a facility. These rates are calculated and based on each facility's capacity and available amenities. The proposed rates are based on an increased per-person rate from $0.25 to $0.35. This rate has not increased since fiscal year 2018-19 and accounts for increased costs associated with rentals, i.e. utilities and equipment wear and tear or replacement. Labor costs have increased, reflecting a wage increase for building attendants from $16.00 to $19.16 per hour. This is a fully loaded cost covering hourly rate, deferred compensation, FICA, and worker’s compensation rates. Rates have also been rounded to the nearest $0.50 or $1.00. The rate increases range from 10.11% to 44.00% and amounts over CPI range from $0.79 to $24.89
The fees for Park Athletic Court (pg. 19) rentals have not been increased since fiscal year 2018-19. The increased fees will assist in covering the costs of maintaining the courts. The rate increases range from 6.67% to 20.00% and amounts over CPI range from $0.41 to $0.80.
The Pool Rental (pg. 20) rates are proposed to increase above the CPI because 3 of the 4 pools are no longer under contract with VUSD resulting in cost increases to the City. The one pool still under contract has very limited City of Visalia availability and is unavailable for private rentals. The rates now take into account the VUSD rental rate, VUSD custodian charges, and lifeguard wage increases. The rate increases range from 25.00% to 60.26% and amounts over CPI range from $30.00 to $95.00.
Fire - General Fund
The Engine/Pumper and Fire Truck Fees (pg. 26) have been adjusted to reflect the cost of service. The increases have been taken directly from the FEMA Schedule of Equipment Rates.
Sidewalk and Drive Approach Improvements - General Fund
Sidewalk and Drive Approach Improvements (pg. 29) are performed by an outside contractor to City standards. These services are available to the public when work is required to be done on their property, but they do not want to hire a contractor on their own. The City also offers to place the expense on the Tax Roll, when our contractor is used, so residents can pay for the improvements over time. The cost for each improvement type is directly linked to the contracted rates. A new contract was issued in late June 2023 and the costs for each improvement exceed the standard CPI increase as these costs are now at Prevailing Wage as noted in the staff report dated May 15, 2023, when the contract was presented to Council for approval.
Enterprise Fees - Airport
The Heavy Appliance Electricity Surcharge (pg. 44) is proposed to increase slightly over CPI due to rounding to the nearest dollar for cash handling purposes. The increase represents a 4.44% increase which is $0.23 above CPI.
Enterprise Fees - Solid Waste
The Replacement of Damaged/Burnt Cans/Bins (pg. 67) has several size bins that are increasing in cost. The new base costs are based on our latest purchase prices. This fee is listed to be the “actual replacement cost to the City” and includes the bin cost, sales tax, and shipping plus ½ hour of staff and vehicle time. The rate increases range from 13.39% to 19.65% and amounts over CPI range from $110.16 to $705.58.
ADJUSTED FEES
The following are the proposed fees that have been adjusted by less than the annual CPI, have been reduced or increased to better reflect service and cost, have increased or decreased based on the City’s salary and benefit changes, or have a change in the fee description.
Parks & Recreation - General Fund
The Parks & Recreation team took an in-depth look at the calculation factors for the various rental opportunities. Several factors were adjusted including capacities, whether it was looking at truing up indoor seating capacities or visiting each park to get an accurate count of available tables; these changes resulted in some increased costs (listed above in rates exceeding CPI) while others created a reduction in rental rates.
Picnic Area (pg. 16-17) capacities were evaluated and corrected to provide renters with more accurate numbers for use in selecting a facility. This resulted in a reduction in rates for several parks.
Indoor Facility Fees (pg. 18) capacities were evaluated and corrected to provide renters with more accurate numbers for use in selecting a facility. This resulted in a reduction in rates for two facilities.
Athletic & Miscellaneous Facility Fees (pg. 19-20) the Parks & Rec staff looked at these fees in comparison to the Picnic Areas and Indoor Facility Fees and decided that the Non-Profit discount of 20% and the Commercial upcharge of 20% should be added to these facilities. This provides consistency with all Park and Recreation facility rentals. They also realized the need to have a fee assigned to Tournament use of any of the Athletic & Miscellaneous Facilities. Tournaments traditionally have a greater toll on athletic fields and the surrounding park facilities. Staff researched other agencies to see what the fair Tournament rate up-charge may be and determined that 30% of the Commercial rate would allow the City to cover expenses, but not deter organizations from using our facilities. They are also asking to apply “pass-through” charges for services such as increased janitorial and trash pickup if deemed necessary.
Enterprise Fees - Building Safety
The wording for Temporary Electrical Sales Lots (pg. 48) has been changed to be more descriptive of sales lot situations versus limiting the fee to only Christmas tree lots. This fee is used in conjunction with the issuance of a Temporary Conditional Use Permit (TCUP) and covers the cost of the inspection of the electrical set up. Once the TCUP has expired, a new inspection would be required with any new TCUP. The fee has been applied to all types of Temporary Sales Lots, so this change cleans up the verbiage to allow a better understanding for the public and those wishing to host temporary businesses in need of electricity.
Enterprise Fees - Solid Waste
The Special Service - Additional Service - Bin Roll Out (pg. 65) the listed fee is being changed to more accurately reflect the full service fee that is charged. The fee of $2.90 is charged for each direction the bin is moved over 20 feet and the service is always done in both directions (from near the dwelling to the curb and back again) so the resulting charge for the service is $5.80. By listing the charge as $5.80 the division is hoping to alleviate any misunderstanding.
The Replacement of Damaged/Burnt Cans/Bins (pg. 67) cost for the 40-yard bin is decreasing based on our most recent purchase invoice in July of 2023. This fee is listed to be the “actual replacement cost to the City” and includes the bin cost, sales tax, and shipping plus ½ hour of staff and vehicle time.
Salary & Benefit Changes - The following rates are associated with a specific job position and have been adjusted based on historical salary and benefit increases and budget assumptions for the next budget year. Rate increases range from 6.47% to 12.18% and amounts over CPI range from $1.05 to $19.53.
Fire - General Fund (pg. 26)
Planning - General Fund (pg. 22)
Enterprise Fees - Building Safety (pg. 51)
Enterprise Fees - Solid Waste (pgs. 66 & 67)
EXISTING FEES - PREVIOUSLY NOT LISTED IN THE DOCUMENT
Business Tax - General Fund
Infraction fees (pg. 12) On March 18, 2024, the City Council approved amendments to Title 5 of the Municipal Code. Included in those amendments were changes to Title 5.04.420 Infractions which allows for the fees to be adjusted by resolution of the Council for all offenses; therefore, the fees will no longer be listed in the Ordinance document, but rather be listed in the Rates and Fees document which is brought to City Council annually for review and approval.
DELETED FEES
Business Tax - General Fund (pg. 12)
Distribution of Printed Matter Fees are being deleted because Section 9.24.010 of the Municipal Code strictly prohibits the distribution of printed matter.
Sidewalk & Drive Approach Improvements - General Fund (pg. 29)
The fee below is being eliminated because it is not a service included in the City contract and is no longer a service we offer to the public through our contractor.
Parks & Recreation - General Fund (pg. 16)
The rental of the Community Campus located at 300 NW 3rd Ave., has been removed. This park is part of a Lighting and Landscape area and is not eligible for reservations.
Enterprise Fees - Solid Waste (pg. 67)
The City Owned Enclosure Fee is being removed because of its redundancy. It refers to the cost of cleaning the enclosures, however, those costs are listed just above with the cleaning rates for all enclosures.
The costs for Replacement of Damaged/Burnt Cans/Bins for 8-yard and 10-yard bins are being removed. Staff has decided to eliminate these two bin sizes from our inventory and they will no longer be available for replacement. A few are remaining in service, however, when those need to be replaced the customer will be guided to select a new size.
Enterprise Fees - Transit (pgs. 72 & 73)
The Topper/Header Only advertising option has been removed as an advertising opportunity. This was an advertising location that our previous marketing partner suggested. Our new team has suggested that we remove this option because it is a very small portion of the vehicle, and the space is currently included with the King Kong, Queen Kong, and Full Wrap options.
ANNUAL ADJUSTMENTS - AUTHORIZED BY ORDINANCE
The following is a listing of proposed fees where fee increases are required by ordinance.
Business Tax
The annual increases are based on the three-year average of the Consumer Price Index for All Urban Consumers (CPI-U) - U.S. City Average as previously approved by Council and authorized by City Ordinance. This adjustment is not subject to Proposition 26 rules as this is an automatic inflationary adjustment and not a new imposition of a tax levy, charge, or exaction because a fee is imposed when the governing body approves it, not when the fee takes effect. An inflationary adjustment to a levy, charge, or exaction including a fee is merely a fee category set to begin at a certain future effective date. The fee is not considered an increase when it is adjusted for inflation (see Government Code Section 53750(h) (2) (A). The index applicable to Fiscal Year 2024-25 is 5.61%. These fees will be in effect on July 1, 2024.
Impact Fees
The ordinance that approved cost of living increases for impact fees is based upon the Engineering and News Record Construction Cost Index (ENRCCI). The index applicable to Fiscal Year 2024-25 is 6.07%. These fees require a sixty-day notice and will be in effect on Aug 17, 2024.
Fiscal Impact:
Proposed increases in various City rates and fees will help Departments cover costs and lessen the impact on the General Fund.
Prior Council Action: The Council reviewed and approved new fees and adjustments to the Rates and Fees on June 19, 2023, for Fiscal Year 2023-24.
Other: The following committees and commissions have reviewed the proposed rate and fee adjustments and recommend to the City Council the adoption of the adjustments to the City’s Rates and Fees for Fiscal Year 2024-25. 
Alternatives: N/A
Recommended Motion (and Alternative Motions if expected):
recommendation
Review and discussion only; Council comments and direction are requested. Action will be taken following the public hearing at the June 17, 2024, Council meeting.
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Environmental Assessment Status: N/A
CEQA Review: N/A
Attachments: Fiscal Year 2024-25 Proposed Rates and Fees Document