7.4. SR 11-18-2019 - Laserfiche WebLink

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General Information about City Fees The City Council can choose to set fees that fully recover the cost of service or put those fees at lower levels to provide a certain level of subsidy, or alternatively,reduce costs by reducing the level of service. There are programs and services that may justify a subsidy from a tax based or alternative revenue source. For example, community supported public services based on social, safety, or general community welfare. Services that support the general public, such as public safety, are supported by tax and other non-fee revenues,while services more elective in nature and of specific benefit to individuals are typically supported by charging fees to the user. Within the services that are typically funded by user fees, there are several reasons a City Council may not advocate for full cost recovery of services. The following factors are some key policy considerations when setting fees at less than 100 percent of cost recovery: ■ Encouragement of desired behaviors. Keeping fees for certain services below full cost recovery may provide better compliance from the community. For example,if the cost of a permit for a residential tree removal is higher than the cost of the actual removal of the tree,many citizens will avoid getting the permit. ■ Effect on demand for a particular service. Sometimes raising the "price" charged for services might reduce the number of participants in a program. This is largely the case in recreation programs such as camps or enrichment classes,where participants often compare the city's fees to surrounding jurisdictions or other options for leisure activities. ■ Benefit received by user of the service and the community at large is mutual. Many services that directly benefit a group or individual equally benefit the community as a whole. Examples include recreation programs,planning design review, historical dedications, and certain types of special events. Who Benefits Type of Service Tax v Fees Policy Example Services Community Public 100% taxes Police patrol Primarily the community with Public/Private Mostly taxes and some Code enforcement some individual benefits fees Primarily individual with some Private/Public Mostly fees and some Youth sports community wide benefits taxes Individual benefit only Private 100% fees Development services When reviewing fees a City Council keeps in mind which fees should be supported and subsidized and which should be privately paid.