Schedule of Fees
Summary - Action Requested
Forward the Ordinance and fee schedule to the City Council meeting on May 28, 2024 for action.
Brief Background
Staff reviews license, permit, and service fees annually to keep pace with the cost of providing the services, which primarily consists of personnel costs. The Urbana City Code requires the proposed Schedule of Fees to be reviewed by the City Council and put on file with the City Clerk’s Office at least thirty (30) days prior to final action by the City Council. During that time, the Schedule of Fees is available for public inspection and comment at the City Clerk’s Office and on the City’s website. A notice that the schedule is available for review will be published in The News-Gazette.
Relationship to City Services and Priorities
Impact on Core Services
Providing core services requires significant financial resources. Charging fees allows the City to recover some of the costs associated with providing these services. This ensures that the burden of funding these services is distributed among those who directly benefit from them. Overall, charging fees for core services is a practical and necessary approach for the City to ensure the sustainability of services.
Strategic Goals & Plans
Fee revenue is used to support the Capital Improvement Plan and a variety of other City services.
Previous Council Actions
The latest City Council action related to fees was approximately one year ago, when Council adopted the current Schedule of Fees. On May 8, 2023 the City Council adopted Ordinance No. 2023-04-008: An Ordinance Amending Urbana City Code Chapter 14, Section 14-7, Regarding the Schedule of Fees.
Discussion
Additional Background Information
This year, Finance staff proposes a 4.25% increase to the majority of license, permit, and service fees. These increases will help cover personnel-related expenses, including cost of living, longevity, and step increases. It will also cover increases related to the supplies and resources used to provide these services. These increases are also in line with the 4.25% fee increase incorporated into the five-year financial forecast presented to Council in December 2023. Significant exceptions to the 4.25% proposed fee increase are noted as no increases to parking meter or building safety fees. Many of the building safety fees were increased for FY24. Changes to these items have significant administrative impacts that necessitate larger fee increases with less frequency. Furthermore, we do not advise raising liquor license fees, especially considering the significant alterations implemented in recent years to ensure competitiveness with neighboring jurisdictions. If the proposed fee increases are approved, fee increases would generate approximately $22,309 in additional revenue for the General Operating Fund, $62,121 for the Sanitary Sewer Fund, and $10,732 for the Parking Fund. These combined increases total $95,162 of additional annual revenue. The City’s practice is to increase fees to maintain pace with the increasing costs of providing the related services. For smaller fees, the percentage increase may appear more prominent in order to reflect a slight increase in the fee. Therefore, some fees may be higher or lower than 4.25% due to rounding.
The proposed Fee Schedule is attached to the Ordinance, highlighting all proposed adjustments in red. Fiscal and Budget Impact Revision of the Fee Schedule allows the City to keep pace with the costs of providing the services related to the fees (inspections, enforcement, administrative costs, and sewer maintenance). If these fees are not periodically increased for inflation, the City may be forced to raise property taxes or other revenue sources to compensate. These fee increases, if approved, will generate approximately $22,309 for the General Operating Fund, $62,121 for the Sanitary Sewer Fund, and $10,732 for the Parking Fund, for a total of roughly $95,162 annually.
Community Impact
When the City increases fees in line with inflationary increases, the impact on the community is expected to be minimal. This modest adjustment ensures that the financial burden remains proportionate to changes in economic conditions, thereby mitigating any significant strain on residents' budgets. The stability and predictability of fee adjustments foster an environment of transparency and accountability, allowing residents to plan and budget accordingly. Additionally, these incremental fee increases enable the City to maintain the quality and reliability of core services without imposing undue hardship on its residents. Overall, by aligning fee adjustments with inflation, the City is committed to responsible governance while sustaining essential services vital to the community's well-being.
Recommendation
Forward the Ordinance and amended Fee Schedule to the City Council meeting on May 28, 2024, as presented with no changes, for action.
Next Steps
Following approval of the Fee Schedule, staff will make appropriate adjustments to update fee information in financial systems and on the City’s website.
Attachments
1. An Ordinance Amending Urbana City Code Chapter 14, Section 14-7, Regarding the Schedule of Fees (July 1, 2024 through June 30, 2025)
Originated by: Robert Kouzmanoff, Deputy Finance Director
Reviewed: Elizabeth Hannan, HR & Finance Director / CFO
Approved: Carol Mitten, City Administrator
