Report to Mayor and City Council
Thursday, March 09, 2023
Discussion
SUBJECT:
Title
CITYWIDE USER FEE STUDY UPDATE - FEE RECOMMENDATIONS
Body
I. SUMMARY
The City of Carson charges user fees for a variety of services provided to citizens and groups. The principle behind charging a fee is the service benefits the individual rather than the entire community; therefore, the fee should be shouldered by the individual receiving the service. Private organizations that charge a fee for services and they generate a profit, this is an acceptable practice. However, local government may only set a fee for a service to recover the full cost of providing that service. In certain circumstances the City Council can set a policy whereas established fees for certain services are at a level that are not recovered by the fee, resulting in a General Fund subsidy.
On February 4, 2020, the City Council approved a professional services contract with Revenue & Cost Specialists, LLC, ("RCS") an independent financial consulting firm that specializes in government cost allocation, cost recovery, user fee study and overhead cost analysis. RCS worked with City staff in identifying services offered by each department and calculating the full cost of each service including labor, benefits, materials, supplies, overhead expenditures, and calculating subvention levels for each service. The comprehensive fee study for each department reports:
* The current fees compared to a proposed fee based on the actual cost of service; and,
* Recommendations for potential new or adjusted fees and charges for services
The focus of the fee study is to determine the amount of revenue necessary to fully fund the costs of providing services at the level the community has come to expect and enjoy. The calculation of the full cost of service can then be used as a guideline for the City Council to determine the appropriate level of cost recovery. Though the last professional, comprehensive fee study...
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