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HomeMy WebLinkAbout24-Council Office CITY.OF SAN BERtARDINO - REQUEST ~R COUNCIL ACTION From: Dept: Date: Councilman Ralph Hernandez Council Office April 13, 1992 Subject: Appeal To Council Fee Synopsis of Previous Council action: Recommended motion: To reconsider the $75.00 appeal to Council fee. Signature Contact person: Councilman Ralph Hernandez Supporting data attached: FUNDING REQUIREMENTS: Amount: Phone: Ward: Sou ree: Finance: Council Notes: Aaenda Item No ~ 1./ - . C 19y o o F SAN B ERN A R DIN 0 INTEROFFICE MEMORANDUM CITY CLERK'S OFFICE DATE: April 17, 1992 TO: Hon. Mayor and Members of the City Council FROM: Rachel Krasney, City Clerk SUBJECT: $75 appeal fee COPIES: Hon. James Penman, City Attorney; Shauna Clark, City Administrator --------------------------------------------------------------- Following up on this morning's agenda briefing, I would like to provide the following background information concerning the $75 appeal fee which has been placed on the Council agenda by Councilmember Hernandez (Item #24). Up until September 1990, the Municipal Code did not provide for an appeal fee for vehicle, weed and building/nuisance abatement appeals made to the Mayor and Common Council. However, the Municipal Code did provide for an appeal fee for Planning Commission appeals. In April 1990, former City Clerk Shauna Clark, submitted a proposal to the Legislative Review Committee recommending that the Mayor and Council approve the enactment of a $75.00 appeal fee for all vehicle, weed and building abatement appeals made to the Mayor and Common Council. On April 19, 1990 the Legislative Review Committee did approve the proposal. A hearing was held and on September 5, 1990, Resolution No. 90-375, was approved establishing a fee for all vehicle, weed and building/nuisance abatement appeals made to the Mayor and Common Council. On September 17, 1990, Ordinance No. MC-742 was approved amending Section 8.27.060, 8.33.060 and 8.36.120 of the San Bernardino Municipal Code Requiring a Fee for Vehicle, Weed or Building/Nuisance Abatement Appeals made to the Mayor and Common Council. When the proposal to establish such a fee was first introduced, the staff report stated that such a fee was being proposed because of the time and preparation involved with scheduling and hearing appeals. Appeals of vehicle, weed and building/nuisance abatements are similar to planning appeals, therefore, the fee was based on the planning appeal fee. (?Y) .!. W! o o Hon. Mayor and Common Council April 17, 1992 Page Two At that time the planning appeals fee was $75; that fee is now $110; however, the appeal fee of $75 remains the same for all vehicle, weed and building/nuisance abatement appeals. City Clerk's Office procedures involved with scheduling appeals are: . Receive, date stamp, and log in appeal letter . Verify that the appeal contains all required information . Deliver appeal letter to department(s) involved . Research appeal and prepare council action correspondence, staff report, and any other necessary documentation to include in the agenda backup. . Send documentation to City Administrator's Office for review and scheduling of appeal . Prepare Agenda . Notify the appellant by phone of the date and time the item will appear on the agenda . Mayor and Common Council hear the appeal . City Clerk's Office sends letter to appellant confirming action taken on the item. (In some cases, the item is continued and must be scheduled on the agenda a second time) . Preparation of official minutes of the Council meeting Based on the above processes, the value of time expended by not only City Clerk's staff but by other departments in processing each appeal certainly exceeds the $75 fee. Since January 1991 to the present, this office has processed 4 vehicle/weed abatement appeals and 11 building abatement appeals, for a total of 15 appeals in 16 months. If the appeal is found to be valid, the appeal fee is reimbursed to the appellant. I realize that the decision on whether or not to keep the $75 appeal fee rests with the Mayor and Council; however, I thought the above information might be helpful to you. Additionally, I would like to share with you copies of the attached article entitled "Market-Based Pricing" which appeared in the April 1992 edition of Western City. The article discusses market-based pricing and using that as a method by which government can re- evaluate the way it prices products and services to more fully reflect the true cost as well as the demand for services. I believe the article addresses concerns all of us have and offers suggestions on how cities can respond to citizen demands for services. ~~~ Rachel Krasney City Clerk Attachment . MAR K E .~. - B: A, SED. WHERE , ~ 5 E LF · I N I ERE 5 I M.E E I 5 . I'H E PUB Lie GOO D How did Seattle reduce trash pickups from an average of 3.5 cans per week down to just one? . How did one city cut its false alarm runs by 30 percent? . Why have 30 percent of one offices down- . town workers quit driving regularly to work and use alternative transportation? . . Should Visalia be happy that their citi- zens pay about $6 million a year for fire insurance and another $1.3 million for their fire department while experiencing only $300,000 in fire loss each year? ~ LEAGUE Or CALIFORNlA CmES o . ,," s o \. u # When a business provides a service, success - both in terms of making money and the excitement of meeting the needs of others - depends on more customers using the service. City officials often hear their business leaders tell them, "You should operate the city like I run my business." Un- fortunately, when cities have more "customers" it generally means that more of that service must be provided for the same amount of money. More library users for example mean more staff, books and equipment have to be purchased. However, there isn't a corresponding in- crease in revenues to support this increased need. :V1ast cities unknowingly encourage citi- zens to demand more services than the city can provide. This results in unhappy citi- zens and frustrated city officials. It gener- ates heated interchanges. petitions, pro. tests and sometimes it leads to a loss at re- election time. Cities aren't naturally self-destructive. City officials are in office to meet the needs of their citizens: Government is supposed to respond to citizen demands with ser- vices financed from general revenues. But there are never enough revenues to meet the requests from citizens. One solution to this dilemma - market- based pricinl( - is already being practiced by numerous cities. counties. stales and the federal government. For example. most cities charge fees for selected services such as building plan inspection and recreation programs. but few have systematically explored the power ot a simple shift in thinking about the roie ot government. Instead of assuming that all citizen demands must be met and turning to fees as the last resort cities can consciously use - Ii I o N p.":::'.':i ;;0:: _,";;r f:::!:!i:- ::"-:';~-~ tn '''nr~n/T'' tf", demand joT their services. This strategy can lead to satisfied citizens who understand what they are getting for their money. satis. lied city officials who are fulfilling their responsibility to provide quality public ser. vices. and a society whose difficult prob. lems. such as traffic congestion and envi- ronmental quality. are being' solved. A Loo k Inll The Future Each year. the League of California Cities Committee on 21 researches a "21st Century issue" and discusses its impact on California cities in California. In 1991. the Committee looked into market~based pric. iog as a possible method by which govern- ment could fundamentally re-evaluate the way it prices products and services to more fully reflect the true cost as well as the demand for services. The Committee con- cluded that the pricing' ot government ser- vices and resources creates a powerful set of incentives encourag'ing the "wrong" things. In most cases. this oc<..--urs because access to government services or re- sources is underpriced. "Market-based pricing" may be viewed as just another bureaucratic title for figur- ing out how government can charge more for services. And it may look that way when given a cursory look. However. members of John]. Kirlin is Professor of Public Administration at the Univmity of Southern California. Sacramento Center. He served as project consuLtant to the League's 1991 Committee on 21. which examined the sub- ject of market-based pricing. Sheri Erlewine is the Director of Communications for the uague of California Cities. This article is adapted from the Commiffee on 21 Report. "Market-Based Pricing- Combining Self-Interest and The Public Good: A Win-Win Solution". The report includes additional examples. more detailed discussion of the concept. and a strategy for implementing market-based pricing. Copies of the report are available for $5 plus sales tax from the League library: 1916J 444. 5513.00.311. o t1", Cnmmith-'/' nn '!1 ("now III hf~lif-'\'P tl1<1t unless we change some of the rules by which we play. we really have no hope to properly manage our cities. Pricing services provided by govern- ment to recoup the actual cost of providing not only the service. but also the cost to the environment for its use. is not exactly new. However. pricing for full social cost is not widespread. The idea of market-based pric. ing is beginning to find its way into the pub- lic sector. even while not titled as such. What exactly is the cost of a dis- posable diaper that will take up space in a landfill? Should the buyers of disposable dia- pers help to pay for the cost of disposing of them? What are the costs of launderin~ cloth diapers and of emissions emitted from delivery trucks? Should parents who use cloth diapers pay the full costs of disposing them? To the Committee on 21. having both sets of parents con. front the total social costs of their choices seems like a reasonable approach to man. aging resources. When someone files a lawsuit in court. has a false burglar alarm. checks out a library book. or dials 9-1-1 for a fire truck. there is usually no fee paid to fund those services. Therefore. the user of the service is unintentionally told to use as much of the service as they want. There is no connec- tion. without a fee for the use of the service. between payin~ for a service and using that service. as there is in the private sector. The obvious response irom the voters in the community is. "But that's what I'm pay- ing taxes for." Unfortunately. funding most services via taxes prevents citizens from knowing the cost of any service. providing Continued o . Instead of complaining about not enough landfill space. the City of SeaIIIe instituted a "pay as you throw" method of trash billing. The more cans put out for pick-up. the bigger the trash bill Result: pick-ups went from an average of 3.5 cans per household down to one. . To provide an incentive for using of alternative forms of transportation. the League of California Cities aDows its emp\oyees in Sacramento to choose between paid monthly parking or an equal sum of cash which can be used fora bus pass, car pooling costs, light rail, etc., all of which cost less than the. monthly parking fee. Market-Based Pricing - To make prices reflect the full social cost of goods, from a can of soda to a kilowatt of electricity. , N.__e 1. Sharon Begley Wilh Mary Hager. MAdam Smith Turns Green: using Market Forces To Clean Air and Water." Newsweek. June 10. 1991. Page 60 WESTERN em-, APRIL 1992 . Several years ago. the city ot VIS8tia dt:te/mined that resicieIIts paid about $6 million a year in fire insur- ance and about $1.3 million a year for its fire department through taxes. However, the community's .average fire loss over the past ten~ had -been.oiIly $3OO,OOOper-ye=Have lnsuram:e <'()ftI)>"nies given:adequate aeditto thefire prevention sysIem in VISllliat . A burgIar~ inslal1aliolIpermit isrequired-in Los .AngeIeL!I'O'1'e- coup losses from revmrlilqrinfalse alanns, the Los Angeles Po1ice.€oJn. mission bills permittees $651nrfalse alarms in excess of four within a 12- month period. .The Thousand Oaks library charges an _annual fee fodibnuy cards to those non-residents wishing to bomJwmalerials, aIblDd cbildren's pi_awl!, and use othetJihrary1lel' vices., NolH'eSidents:aa:ounUor 37 pen:ent of thelibrary's podluuage. ~ \) ,Harket - Based Pricing, Continued incentives to overconsume the resources ot" government. It may be time. as Moreno Valley City Manager Norman R. King points out. "to borrow the notion from the private sector of mana,ginR' the demand of a service or resource rather than the supply, i.e.. charging people to use the free- way at peak times versus building more freeways." , Muaging 081Dlld Supply management defines a problem as "not enough of' and the solution as "more of." Demand management offers a different perspective on the same problem. It is a perspective that recognizes there can be too much demand for a service or resource. For public administrators. the solution is often to figure out how to manip- o ulate the demand downward so we don't have the problem to bel'[in with. One method of managing demand is via pricing. SOffie public officials and citizens may oppose mana~ing demand due to their belief that public services should be avail. able to all. But demand and access are "managed". even in the absence of price. Several-hour waits for public health ser. vices means that only the poor and desper- ate receive these services. Better schools in affluent areas ensures that children of high income families have better educators. Managing demand recognizes that govern. ment cannot spend to solve all problems and satisfy all demands. The need for additional land-fill space is a problem ior many local government man- agers. If the real problem is that there is HOW TO IMPLEMENT MARKET-BASED PRICING Making.. the ~ecision to embark on vices whose consumers can be readily market-bMed pricing for cil3' services identified and therefore held accountable can be ~.....dy cbaIlenging. While forthecostofcoDsump!ion."'Ifpossib1e, there are 1!lDIIIlp1es of aImolIt l!W!I'Y consider reducing taxes when Dew or possiblaapplication found some- increased fees are imposed. where in the 1OIlIid, !bat is obo. amaD 4.... u_ M III F"'~' _'.;ft oo1aceto,-"-.- '.-.'. ";'Ia inthe1llidllt.of . --... -,...,...... -, . the concepts.l>ehind 'market. pricing ..inandn' I..... "'IV W- aadpracdeee. . with. reporters. editorS and editorial 1be;_:~1lOD8icIend'~', '~leastwhen.they fullyunders- I. .....,.....1......../141_ land the philosophy, they're likely to in- tl../I........... . Considehhe elude many of the'common sense ap- many possibilities for gaining public edu- proaches behind mar- cation and .participation, from existing ket-based pricing in boards or commissions or setting up a their coverage. specia1 tasldoree.to look at possibi1ities'S~.""'LD.' '.. for implementing these Ideas to dis- t... ..... C.... cussing them 'at service clubs or during ...... Explain the budget hearings. Ideally, market-based concepts - either how 'pricing emerges as one element of an they're used in the overall strategic plaDfor creating a cil;}" or what state/fed- desired fularefor your.city. Pricing, or eral policies could . anyodiet'fIiDllIe-element, when placed .benefitto members into conrext, becomes a ll'girim.t... iDle- of the Assembly, Stale gra1 par$'oflh&-p!an. . Senate and Congress. :,2..a-tf....1. a..ginning smaI1 "6....... WInoWIII ;:can.spell.~'Jnc._lal increases~~'.:"". The example of the ofan existingfee or beginning a new Sl!!'- city'slmp1ementing a membership fee for . vicecanbemethods to start small and use of its tennis courts.and ending up 8ChIeVe ~:thereby pavingthe way with-weJl.maintained courts, happier ten- .' fnF.futunmJarket-basedprice! '.;..g nis players and no impact on the general fund is a win-win situation. Upgrades in ~3.........._bIatI.., '-/.-. quality of service or tailoring a service for ... ..SimpIy increasing fees and char- individual users are good places to look .ges.isnlJ:heonly.mannerof;m~t- .for.win-win opportunities. fonoarket- ing:markl!t-basedJricing. Ageners1ru1e based pricing, of thumb promoted by Moreno Valley City ~.Norm King,however, is "Don'tuse tlIlll!Spwhieldl8....no. behllV' .iorai effllct;,....,..~you ClII1-....fees. 1bisme8llS:inJposing user fees forsee- '_,'.L 10 ';\<~~';i'; . ,;;...j!'~L~' :';;:,'::;" .-:..:;-~>r;,:':2-!,' o too much waste. as suggested in the demand management model. versus not enough landfill space. then the solution is pricing the use of landfilis in such a manner that citizens make individual decisions to reduce their waste. Seattle's experience demonstrates the power of the pricing method: a two-thirds reduction in the vol- ume of waste when the city began charging a per-can iee. a huge improvement. Managing demand may be a contrary concept for many public sector managers who understand that in private enterprise. demand is good - it means success. However. increased demand for the ser- vices of government generally means that more of the service must be provided from roughly the same amount of revenue. Unless supported by fees. increased ser- vices in one area can oiten be funded only by cuts elsewhere or eroding quality. Libraries are a good example. As librarie~ generate more use. more revenues from a city.s ,R'eneral fund are needed to keep up with the demand. This in turn means that some other general fund service is cut to provide the funds. Citizen are often heard to say. "private industry cuts back all the time. so should government." This is true, private industry cuts back when a product fails: however. when government cuts back. it's often because demand for a service has outpaced funding. This is not to say that the demand for libraries should be suppressed. How- ever, it may be im- possible to fund all requests for increas- ed services from tax revenues. and it is unwise in any case. Alternatively. the city can provide a base level of service funded by the gen- eral fund and then charge to fund addi- tional programs or service levels. "The irony is that as capitalists. we believe that the laws of supply and demand work well in the private sector - but we disbelieve their validity in the public sector. This is in spite of the fact that properly implemented pricing systems will promote the conservation of many government resources. Again. user tees are not just a way to raise money. They are also a way to "In private enterprise, demand is good - it means success. However, increased demand [or the services of government generally means that more of the service must be provid- ed [or roughly the same amount of revenue. " N__ Ki..g, city MIIIHI!J.., M...... VaUey L _ R. King. "MaaIeiDg DemIIId For GoY- emmental Services." M."",.", ForTOIJJDPT'01I7: .-.a...<Aod LoazI_ _ Cily ~ Fouodation. PIse 143-153. 2. ~onnan R KinR. "Managing The Demand For Gov- ernment Services,'. Managing For Tomorrow: Global Change And Local Futures. International City Manage- ment Foundation. PalZes 143-15:-: improve the efficiency of allocating resources. thus affirming the rationalizing function of price." 'Vhile the goal of advocates of privatiza- tion - through contracting with private [inns or simply to stup providing a servicl' - is usually minimizing governmental expenditures. for advocates of market-based pricing. the goal is maximizing societal ben- efit. Only by providing full information on the consequences oi our actions-best done through market-based pricing-can \\'f' turn individuals' :-e]f-interest toward maximizing our common benefit. Allltude AId Behavlup Cbllge As has been seen. the concepts behind pricing government are larger than raising enough revenue to pay for the services in place now. By adopting incentive-based pricing strategies. citizens are able to make choices about how they use services and products such as freeways. parking spaces. health care. police services. libraries. city airports. and thousands of others which are used every day. If the proper incentive is provided with pricing. the quality of life could dramatically improve for everyone. Today. citizens otten complain that "gov- ernment spends too much." From a mar. ket-based pricing perspective. however. the issue is not government decision-making. but the thousands of small decisions each citizen makes that causes government to get bigger. This strategy offers hope of a more positive and fruitful exchange about the size and activities oi government. To accomplish a move toward market- based pricing. however. there must be a fundamental change in the way govern- ment is viewed. This concept involves changing rules and processes so that the actions. choices and behaviors of individu- als result in what is good collectively for society. When the C .S. Forest Service col- lects fees for a campground. that money goes to the federal government's general fund. On the other hand. if the Forest Service sells trees. they get to keep a per- centage of the gross sales of the value of the timber sold. This results in a clear poli- cy statement that says: cut trees~ In its annual report. "The 1990-91 Budget: Perspectives and Issues". the California Legislative Analyst's Office devoted a 17-page section to "Air Quality Improvement: An .-\lternative Strategy."' :I. Ibid. -t. Sharon Be.R"ley with \larv Haj:rer. MAdam Smith Turns Green: Usinll ~Iarket Forces To Clean Air and Water:. l-iewsweek. June 10. 1991. Pa,lte 6<.1 o o EKAMPtES . Although fixed fees are easier to work with, the Claremont Comrmmny Development Department utilizes hourly rates for development reviews because they feel hourly rates are most equitable: simple projects cost less, complex ones cost more. The hourly rates also encourage patrons to submit applications that are c0m- plete, clear, accurate. in conformance. and quick to review. thus requiring less smff time. . In March, 1989 the City of River- side hired a private consultant to per- form revenue and cost analyses and to develop a cost dis- tribution and control system for all city services. As a result. the city was able to: (1) determine the costs of providing specific city services; (2) identify the ben- eficiaries of those services; and (3) es- tablish a policy of re- covering the full cost of providing short- tenn special services. Empowered with this information, the city implemented dozens of fees including a storm drain additive fee used for the im- provement and con- struction of storm drains; a grading plan review fee used to cover the cost of plan processing and site inspection: and a sewer service fee which goes toward the maintenance of sewer lines. The analysis concludes that incentive-based regulation is preierable to command and control regulation as a strategy. In fact. the report recommends an amendment to the California Clean Air Act "to explicitlv authorize' the 11~f' oi incentivl'-ba~ed rel!1.lla- tory policies." among others. A recent j\iewsweek article on using market forces to clean air and water went so far as to state. "Command and control did make the nation's air and water cleaner. but it also made enemies in board rooms and living rooms. Business lobbies hard against new regulations. and last fall almost every envi- ronmental referendum went down to defeat as voters equated .'{reen laws with a grab for the green in their wallets. Worse. tra- ditional pollution control has begun to cost more and more even as it achieves leRs and less.": So. if people act in their own self inter. est. and only a fe\\' products and ser- vices are priced pro- perl\'. there is no reform. All items and services need to be fully priced to provide information upon which individ- uals can act. Go- vernment usually tries to meet what- ever demand exists ior a service or net'd. Market-based pricing calls for gov- ernmenl to fully price commodities such as water. free- waY$. etc.. with the likely consequence of reduced demand. ~-lost citizens. for example. think they are paying for the cost oi water when. in actuality. most are only paying 30 to 50 percent of the actu. al cosl of delivering water. One community recently experienced a 45 percent reduc- tion in water use in a matter of weeks with J. significant price increase of water rates to renect actual costs. Thereiore. changing - or adjusting - behavior. attitudes and conventional wis- dom wiii be needed lirsl oi public uffidab. then citizens. in order to bring about this new way of thinking. ADVANTAGES, CHALLENGES What Aft" U-_I_JII Of Mcuto:et-..... PrIcing? - A Cleaner Environment _ Better Government Services o Better Citizens Who Can Decide Detennine Their Actions Based On The Consequences Of Their Choices olt Makes Common Sense o We Quit Subsidizing Others' Use Of Public Services o It's Proven That It Works The Challenge. o Resistance To Change oThe Language Is Foreign o People Don't Want To Pay More -Tax Policies Discourage Many Market-Pricing Strategies o Individual Cities Or Employers Can't Totally Implement The Concepts oTakes Leadership and Courage To Suggest These Concepts Publicly . The California Legislature has moved toward adding a fee to prod- ucts that become household haz- ardous waste, with revenue returned to local governments to fund house- hold hazardous waste collection pr<r grams; or enacting an "advance dis- posal fee" for materials that are even- tually disposed, with part of the revenue available to local government to fund waste diversion programs. . WESTERN CITY. APRIL 1992 II