Traditional Diversity Tools

1
Traditional Diversity Tools
League of California Cities Annual
Conference October 2002

• Presented By
• Bill Statler, Director of Finance/City Treasurer
• City of San Luis Obispo
• Mike Dennis, Director of Finance
• City of Santa Monica

2
Overview

• Proposition 218 made sweeping changes in the way
  that cities manage and control their revenues.
• New standards for voter or property owner
  approval of
• Assessments
• Taxes
• And many (but not all) fees

3
But Still Discretion in Fees Fines

• User Charges and Fees
• General Fund
• Enterprise Funds
• Includes development review and impact fees under
  AB 1600
• Municipal Code Fines

4
Staying in Touch with These Tools

• Many cities in the wake of State budget grabs and
  recession of the mid-1990s took a close look at
  these
• But with the passage of time, are they still in
  place and make sense?

5
3 Reasons for a Re-Look

• Have they been updated on an ongoing basis and
  are the policy basis and analytics underlying
  them still valid?
• One of the few remaining areas for local elected
  official judgment.
• And if there are areas where user fees should
  appropriately fund service costs but they
  arent then general-purpose revenues are being
  used instead.
• And lastly, they help achieve better revenue
  diversity a worthy goal on its own merits.

6
User Fees

• Five Key Policy Questions
• What does it cost the City to provide various
  services?
• Are these costs reasonable?
• What are current cost recovery levels?
• What should the cost recovery level be?
• What fee changes are necessary to implement the
  Citys cost recovery policies?

7
Related Issues

• Ongoing Updates Whats Your Strategy?
• Indirect Cost Allocation Plan

8
Impact Fees

• Do you have clear policies regarding new
  developments responsibility to cover the
  facility costs necessary to serve it?
• When general-purpose revenues will be used for
  this?
• And when wont they?

9
Fines and Meters

• Generally, Two Types of Vehicle-Related Fines and
  Fees
• Fines issued for violations under the California
  Vehicle Code (CVC).
• And those issued under local law through the
  municipal code.
• Parking meter violations
• Street cleaning
• Preferential parking
• Disobeying signs.
• Parking in a red zone

10
Why Take A Close Look At These?

• Good Policy
• Discourages Bad Behavior
• Parking in a red zone.
• Encourages Good Behavior
• Moving cars on street cleaning days.
• Turnover for business customers.
• Reducing vehicle trips and encouraging
  alternative transportation.
• And maybe adds a few bucks to provide services,
  too.

11
Timing Is Everything

• So, when do you do these re-looks at your
  diversity management tools?
• Outside of the budget process, where they can be
  dispassionately viewed on their own
  philosophical merits?
• Integral part of the budget process, so that the
  resource trade-offs between setting user fees at
  an appropriate level versus the ability to fund
  high-priority initiatives are clear?
• This message may be easier to communicate when
  the real-world benefits are clear and compelling.