HomeMy WebLinkAboutItem 7.2 RevenueOptionsStatusRpt (2)
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CITY OF DUBLIN
AGENDA STATEMENT
CITY COUNCIL MEETING DATE: Apri1 26, 1993
SUBJECT: Fisca1 Year 1993-94 Revenue Options Status Report
(Prepared by: Richard C. Ambrose, City Manager)
EXHIBITS ATTACHED: ~ity Counci1 Agenda Statement of March 22, 1993
RECOMMENDATION: arify timeframe for imp1ementation of a Citywide
Street Lighting & Landscape Assessment District and
increase in the Rea1 Documentary Transfer Tax.
FINANCIAL STATEMENT: See be1ow.
DESCRIPTION: On March 22, 1993, the City Counci1 directed Staff to
pursue the imp1ementation of a number of revenue enhancements in order to
ba1ance the Fisca1 Year 1993-94 City Budget. The status of imp1ementing
each revenue option is shown be1ow.
1. Increase Bui1ding Permit Fees
Status
Pub1ic Hearing 4/26/93'
Pub1ic Hearing 4/26/93
Pub1ic Hearing 4/26/93
Revenue
2. Increase Encroachment Permit Fees
3. Estab1ish Fee for Fix-It Ticket
Signoffs
4. 'Estab1ish Fee for Fire Inspection
Services Required by Other Agencies
Report to DRFA schedu1ed
for 6/21/93
5. Increase Recreation Fees
Review comp1ete by Parks
& Recreation Commission;
Reso1ution to
City Counci1 5/10/93
Pub1ic Hearing 4/26/93
6. Estab1ish Towed & Stored Vehic1e
Re1ease Fee
7. Estab1ish Crimina1 Background
Check Fee
Pub1ic Hearing 4/26/93
8. Transfer Cost of Service to
Property Owners for Sidewa1k
Repair
Procedures for imp1ementation
being drafted. Po1icy to be
presented during 1993-94 Budget
Hearings.
9. Estab1ish Supp1ementa1 Fee for
Emergency Medica1 First
Responder Service
Report to DRFA Board 4/19/93;
DRFA Pub1ic Hearing schedu1ed
for 6/21/93.
10. Library Service Funding
Staff working with County
Librarian.
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ITEM NO. 2. 7.
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COPIES TO:
CITY CLERK
FILE ~
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Revenue
status
11. Establish a Citywide street Lighting
and Landscape Assessment District
Fee of $18.00/year for Park
Maintenance, street Landscape
Maintenance, street Tree
Maintenance, and Traffic
Signal Maintenance
No action.
12. Increase Real Documentary
Transfer Tax
No action.
Based upon the Council's previous direction, Staff has proceeded with those
steps necessary to implement the user fee~revenues.
However, Staff needs further clarification regarding the City Council's
intention regarding the implementation timing for the Citywide street
Lighting and Landscape Assessment District and the Real Documentary
Transfer Tax.
STREET LIGHTING AND LANDSCAPE ASSESSMENT DISTRICT
This District and associated assessment would have to be adopted and the
County Auditor notified by the third week of August 1993, if the assessment
was to be effective during Fiscal Year 1993-94. In order to meet this
deadline, the Council would have to direct that an Engineer's Report for
the District be prepared at its meeting of May 10, 1993. If this action
does not occur, this assessment cannot be levied until Fiscal Year 1994-95.
Based upon the State's adoption of the Fiscal Year 1992-93 Budget three
months into this Fiscal Year, it is impossible to know at this time whether
the City's property tax revenues will actually be reduced with the adoption
of the 1993-94 Budget prior to the deadline for notifying the County
Auditor for establishing a new Street Lighting & Landscaping Assessment.
Issue: Should Staff proceed and incur cost associated with a Street
Lighting & Landscaping Assessment District for 1993-94 before knowing the
outcome of the 1993-94 state Budget Process.
REAL DOCuMENTARY TRANSFER TAX
The ability of City Councils to increase the Real Documentary Transfer Tax
is currently being tested in the Courts in California. The City Council
may wish to consider deferring pursuit of this revenue source until these
court cases are resolved, or select another revenue option from the March
22, 1993 Staff Report instead of pursuing an increase in the Real
Documentary Transfer Tax.
a:426rev.agenda#12
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CITY OF DUBLIN
AGENDA STATEMENT
CITY COUNCIL MEETING DATE: March 22, 1933
SUBJECT:
1993-94 Revenue options
(prepared by: Richard C. Ambrose, city Manager)
EXHIBITS ATTACHED:
Revenue options Report and Attachments
1. Memorandum from Assistant city Manager
Regarding unimproved Civic Center Office
space dated February 19, 1993
2. Real Documentary Transfer Tax survey
RECOMMENDATION: /)~ ' 1.
\~CV 2.
Receive staff presentation
Identify which revenues staff should pursue
to offset a cut in revenues by the state.
Identify which revenues should be pursued
irrespective of the state legislature's
action.
3.
FINANCIAL STATEMENT:
See below
DESCRIPTION: On February 8, 1993, the city Council was
presented with a report on the 1993-94 city Budget shortfall in the event
that the Governor's Budget proposal is enacted. staff estimated that this
shortfall would exceed $1 million.
The city Council gave staff direction that, in preparing the 1993-94
Budget, 50% of the shortfall should come from expenditure reductions and
50% of the shortfall should come from revenue enhancements. staff was also
directed to prepare a report which provided the city council with more
information regarding the various revenue raising options available to the
city.
staff has prepared the attached Revenue options Report for the purpose of
sOliciting council direction on which revenues should be pursued by staff
for the purpose of offsetting anticipated 1993-94 revenue shortfalls.
Of those revenue options identified in the report, all options could be
implemented to take effect in Fiscal year 1993-94 with the exception of:
1) Fireworks permits
2} EMS Assessments
3} Fire Assessments (?)
4} Library Funding
The city council should consider that the City may not know how much local
revenue will be taken by the state until after the city Budget is adopted.
In order that the city is prepared for 1993-94 for both local revenue
shortfalls and the possible State revenue take, the city Council may wish
to take a two-tiered approach in which it identifies those revenues which
should be pursued immediately, and those revenues which should be pursued
once the impact of the state Budget on the city is known. Based upon the
City Council's earlier discussion, it would be prudent to identify revenue
sources that would generate at least another $500,000 in revenue.
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~ COPIES TO' .1, CITY C L E R KI
ITEM NO. D"-.Z ., FILE ~
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REVENUE OPTIONS REPORT
REVENUE TYPE
A. FEES FOR SERVICE
1. BUILDING PERMIT FEES - Additional Revenue $93,000
a. Description:
The city currently
accordance with the
are associated with
Inspection. The fee
1982.
charges a building permit fee in
Uniform Building code. These fees
Plan Checking, permit Issuance and
schedule has not been revised since
b. Cost of service vs. Revenue
Fiscal Year
Bldg & Safety
cost (1)
Building
Permit
Fees
1992-93
1991-92
1990-91
1989-90
1988-89
1987-88
$
254,801(2)
261,827
352,439
325,858
300,454
320,056
152,000(2)
173,666
180,720
302,818
282,014
513,550
surplus
(Deficit)
(102,801)
(88,161)
(171,719)
(23,040)
(18,440)
193,494
(1) These costs do not include general overhead, i.e. bui lding, uti l ities, insurance,
administration, etc., or Planning review time associated with Building Permits.
(2) These amounts are those budgeted in 1992-93. All other amounts are actual.
As shown above, Building Permit fees for service have not
covered the direct cost for service for the last several
years.
c. Revenue Generated bv Increasina Fees
For most types of permits issued by the Building
Department, the city of Dublin'S fee is lower than other
Valley cities and Alameda county. If the city had raised
its fees to be comparable to fees charged by neighboring
cities in 1992-93, the city would have generated an
additional $93,000 in Building permit fees in Fiscal Year
1992-93. Total 1992-93 revenues would have been slightly
less (approximatelY $9,500) than the 1992-93 Building &
Safety Department Budget, excluding General Overhead.
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d. Implementation
To increase these fees, the City Council would need to
modify the city's fee resolution after conducting a
public hearing with at least 10 days advanced published
notice. This increase would be effective immediately
thereafter.
2. ENCROACHMENT PERMITS - Additional Revenue $8,000
a. Description
The city currently charges fees to individuals and
agencies (i.e. DSRSD, Pacific Bell, PG&E, etc.) that do
work in the street right-of-way and easements. The
services provided include: plan review, inspection,
marking city-owned underground fa~ilities, and permit
issuance. The fees charged are those charged by the
County prior to the city's incorporation in 1982.
b. Cost of Service vs. Revenue
During calendar year 1992, the city issued a total of 127
encroachment permits at an estimated cost of $10,086.
The actual fees received totalled $6,023. Approximately
75% of the encroachment permit costs are generated by
utili ty companies. .
c. Revenue Generated bv Increasina Fees
To recover the city's costs of administering encroachment
permi ts, permi t fees would need to be increased
approximately 67%. In addition, since trenching by
utility companies reduces the life of city streets, a
slurry seal surcharge should be considered on
encroachment permits that involve trenching. The 67% fee
increase and slurry surcharge would generate an
additional $8,000jyear in revenue.
d. Implementation
To increase these fees, the city council would need to
modify the city's fee resolution after conducting a
public hearing with at least 10 days advanced published
notice. The increase would be effective immediately
thereafter.
3. PRE-PLANNING ApPLICATIONS FOR DEVELOPMENT PROJECTS - Additional
Revenue $3,000
a. Description
The city currently issues approvals for various types of
land use applications. For most maj or planning
applications, the City charges actual cost of providing
planning service once an application has been submitted;
however, city personnel are often asked to consult with
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private landowners/developers to review a preliminary
plan before a planning application is submitted or not
submitted. The landowner/developer is not currently
charged for this preliminary consultation.
b. cost of Service vs. Revenue
The estimated cost of providing this service last year
was $3,000. No revenue was collected for this service.
c. Revenue Generated from Increasinq Fees
Based on last year's activity, it is estimated that a
$350 fee would have generated approximately $3,OOO/year.
If the demand for service grows, so would this revenue.
d. Implementation
To increase these fees, the city council would need to
modify the city's fee resolution after conducting a
public hearing with at 'least 10 days advanced published
notice. The increase would be effective immediately
thereafter.
4. MINOR PLANNING ApPLICATIONS - Additional Revenue $43,000
a. Description
For other types of planning applications, i.e. variances,
Conditional Use permits , Administrative Conditional Use
permits, Appeals, etc., the city charges a flat fee which
ranges from $25 to $130 per application for Staff
processing costs.
b. Cost of Service vs. Revenue
The flat fees charged for minor planning applications
currently do not cover the costs of permit processing.
For example, the average Conditional Use Permit costs the
City approximately $1,200 to process, the City collects a
flat fee of $130.
c. Revenue Generated from Increasinq Fees
If the city charged a fee to cover the actual cost of
processing minor planning applications (not including
general City overhead), the city would generate an
additional $43,oOO/year in revenue based upon the current
level of activity.
d. Implementation
To increase these fees, the city Council would need to
modify the City's fee resolution after conducting a
public hearing with at 'least 10 days advanced published
notice. This increase would be effective immediately
thereafter.
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5. FIX-IT TICKET SIGN-OFFS - Additional Revenue $1900-$5000
a. Description
The Police Department signs off tickets for vehicle
owners who were cited for vehicle mechanical/equipment
violations. The police Department estimates that a total
of 500 citations were signed off last year, of which 381
were signed off during business hours at the Civic
Center. These sign-offs usually require that an officer
leave his/her duty in 'the field to inspect the vehicle
and sign off the ticket.
b. Cost of Service vs. Revenue
The real cost of this service is lost patrol time. The
actual cost varies depending upon whether the citation is
signed off in the field or the officer comes to the civic
Center. It is estimated that approximately one-half of
the citations signed off are issued by other law
enforcement agencies.
c. Revenue Generated from Establishinq Fee
Presently, none of the other cities in the Valley charge
for signing o~f equipment citations. Depending upon
whether the city charged for signing off only citations
issued by other agencies or all citations, the revenue
generated may range from $1,900 to $5,000 per year.
d. Implementation
To establish this fee, the city council would need to
modify the City's fee resolution after conducting a
public hearing with at least 10 days advanced published
notice. This increase would be effective immediately
thereafter.
6. FIREWORKS PERMITS - Additional Revenue $3,300
a. Description
The Municipal Code currently allows the city to issue
permits for the sale of fireworks. The permit process is
currently administered for the city by the Dougherty
Regional Fire Authority. Fire Personnel currently review
the qualifications of the applicant, hold a lottery,
issue permit, increase fire patrol on July 4th, and
inspect fireworks booth clean-up.
b. Cost of Service vs. Revenue
All applicants currently pay a $150 permit fee; those
applicants who are not successful in obtaining a permit
receive a $75 refund. This fee currently does not cover
the cost associated with administering the Fireworks
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permi t process and providing additional patrol. Last
year, the estimated cost of administering the Fireworks
Program was approximatelY $6,100. Total revenues for
last year's program were $1,275.
c. Revenue Generated bv Increasinq Fees
If fees were increased to recover the actual cost, a fee
of $900 per application would be necessary. It is
estimated that this fee would generate approximately
$7,000 for the Fire Authority due to the increased number
of booths anticipated due to population growth. Of that
amount, the city of Dublin would realize approximately a
net $3,300 in reduced fire costs.
d. Implementation
In order to increase the Fireworks Permit fees, the City
council would have to modify the existing ordinance.
This would require 10 days advanced published notice and
2 public hearings. The change in fees would become
effective 30 days after the ordinance was adopted. The
current ordinance requires applications to be submitted
between April 1 and April 30; therefore, this fee
increase could not be accomplished until Fiscal Year
1993-94.
7. FIRE INSPECTION SERVICES REQUIRED BY OTHER AGENCIES - Additional
Revenue $3,335.
a. Description
The Fire Department currently inspects childcare and
health care facilities. These facilities cannot receive
permits/licenses from the state of California without
these fire inspections. These inspections are currently
performed at no cost to the applicant.
b. Cost of Service vs. Revenue
The Fire Department currently conducts approximately 115
of these inspections each year. Although the costs are
unknown, Staff believes the cost would exceed the $50
maximum inspection fee currently allowed under state law.
c. Revenue Generated bv Establishinq Fee
If DRFA charged $50 per inspection, the Fire Authority
would generate an additional $5,750 per year in revenue.
This would result in an estimated $3,335 reduction in
fire costs to the city of Dublin.
d. Implementation
The City would need to request that the Fire Authority
implement this fee by resolution.
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8. RECREATION FEES - Additional Revenue $51,325
a. Description
The Recreation Department currently offers a number of
recreational opportunities for all ages in the city.
Fees are charged for programs, as well as facility use in
most cases.
b. Cost of service vs. Revenues
As shown below, the city does not fully recover the cost
of those programs provided in the Recreation Department.
Estimated
Revenue
1992-93
Recreation Admin.
Playgrounds
Shannon Center
Preschool classes
Teen Program
Adult Sports Program
Youth Sports Program
Special Events
Senior Center
Recreation Classes
Aquatics
TOTAL
Budget
1992-93
$180,239
82,443
112,161
36,224
28,382
112,417
24,879
29,680
104,784
86,428
194,219
$991,856
$ 0
33,120
49,000
36,105
3,957
133,890
13,335
10,075
19,521
63,105
65.650
$427,758
c. Revenue Generated by Increasinq Fees
Net Program
Cost
$180,239
49,323
63,161
119
24,425
-21,473
11,544
19,605
85,263
23,323
128,569
$564,098
since the city Council adopted the 1992-93 Budget in June
1992, the council has increased Facility Use Rental fees
for the Shannon community Center and civic Center, and
admission fees for the Dublin Swim Center. It is
estimated that these will generate $7,350 and $10,180 in
Fiscal Year 1993-94 respectively. The Recreation Staff
has also identified those fees that could be raised in
the following areas in 1993-94 without significantly
impacting participation in Recreation programs:
Playgrounds
Preschool
Senior Center
Recreation Classes
Aquatics Classes
TOTAL
$20,890
2,435
4,185
8,915
14,900
$51,325
These possible increases in fees have not yet been
reviewed by the Park and Recreation commission.
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d. Implementation
A proposed increase in these fees should be reviewed by
the Park and Recreation Commission. The city council
would then need to modify the city's fee resolution after
conducting a public hearing with at least 10 days
advanced published notice. The increase would be
effective immediately thereafter.
9. TOWED AND STORED VEHICLE RELEASE FEE - Additional Revenue $2,130 to
$4,260
a. Description
Dublin police services is often called upon to tow
vehicles from the city streets and order them stored by
contract towing and storage companies. The vehicles are
towed and stored for a variety of reasons such as being
abandoned, having current fees outstanding, being unsafe
on a roadway, and when the driver is arrested.
After the vehicle has been towed and stored, Dublin
police services notifies the registered owner by mail of
this fact, where the vehicle is stored, and' of the
registered owner's responsibility to respond to Dublin
police Services to obtain a police Department release for
the vehicle. This release is necessary so that the
police Department can be satisfied that the registered
owner has corrected the problem or problems that led to
the vehicle being towed and stored.
In calendar year 1992, one hundred forty-two (142)
notifications were made to registered owners regarding
towed and stored vehicles. It is estimated that a
similar number will be towed and stored in 1993.
Of the one hundred forty-two (142) vehicles towed and
stored, approximately 50% are recovered by the registered
owners. The remaining vehicles are usually classified as
"junk" and are disposed of by the various towing and
storage companies.
b. Cost of Service vs. Revenue
The cost of this service is in lost clerical time, and
the possibility of lost patrol time, as an officer must
be involved to formally authorize the release of the
vehicle. It is estimated that each vehicle release takes
approximately twenty (20) minutes of clerical records
staff time, as a letter must be generated, and the
subsequent personal contact. Lost patrol time is
estimated to be approximatelY twenty (20) minutes, as the
officer must be detailed from patrol duties and respond
to the police Department. In addition, there is a cost
factor incurred by the city of Dublin cashier or finance
personnel to process the incoming receipts.
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No revenue is currently collected for this service.
c. Revenue Generated bv Establishinq Fee
Based on the time required from both clerical and badge
personnel to process each vehicle release, it is proposed
that the city of Dublin establish a $30.00 fee, per
vehicle release. currently, the city of oakland charges
$35.00 per vehicle release, the city of Fremont charges
$43.00 per vehicle release, and the city of Pleasanton
charges $12.00 per vehicle release. All of these
agencies indicate that they will be reevaluating these
fees with the object of increasing them in the future.
Based on the proposed $30.00 fee per vehicle release, it
is estimated that this would generate between $2,130 (low
end estimate for 71 vehicles released) and $4,260 (high
end estimate for 142 vehicles released) of additional
revenue per year.
d. Implementation
To establish this fee, the city council would need to
modify the city's fee resolution after conducting a
public hearing with a least 10 days advanced published
notice. This increase would be effective immediately
thereafter.
10. CRIMINAL BACKGROUND CHECK FEE - Additional Revenue $3.000
a. Description
Dublin Police services routinely processes requests from
various government agencies to conduct local criminal
background checks on subjects being considered for
employment wi thin that agency. The police Department
estimates that a total of 300 requests are processed
annually by the Records section. These requests are
received both at the front counter during regular
business hours, and by mail.
b. Cost of Service
The cost of this service is in lost clerical time from
regular assigned duties for the clerks in the records
section. When the requesting party comes in person to
the office, it is estimated that each records check
takes an average of five (5) minutes to complete. When
records checks are received by mail, it is estimated that
these checks require an average of ten (10) minutes to
complete, as a letter must be generated. Dublin Police
Services estimates that an averaqe of seven (7) minutes
for all individual background checks is indicated. In
addition, there is a cost factor incurred by the city of
Dublin cashier or finance personnel to process the
incoming receipts.
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c. Revenue Generated from Establishinq Fee
No other city in the county currently charges fees for
conducting background checks for governmental agencies.
Alameda County Consolidated Criminal Records charges a
fee of $2.00 per name with $.50 per alias, with an
additional fee of $25.00 per criminal history printout.
It is proposed that the City of Dublin establish a $10.00
fee, per name, for each background check requested. It
is estimated that this would generate approximately
$3,000 in additional revenue per year.
d. Implementation
To establish this fee, the city council would need to
modify the city's fee resolution after conducting a
public hearing with at least 10 days advanced published
notice. This increase would be effective immediately
thereafter.
B. POLICY CHANGES - TRANSFER COST OF SERVICE TO PROPERTY OWNERS
1. SAFETY REPAIR OF SIDEWALKS - Revenue/Avoided cost $50,000
a. Description
State Law currently requires property owners to maintain
sidewalks abutting' their property in safe condition.
Since incorporation, the City has annually agreed to
provide these repairs, provided adequate City funding is
available. The City council could change this policy and
require property owners to assume responsibility for
sidewalk repair.
b. Cost of Service vs. Revenue
The city has historically spent $50,000
sidewalk safety repair. The city currently
revenue for this program.
a year for
receives no
c. Avoided Cost/Increased Revenue for Chanqe in Policy
It is anticipated that
the sidewalks, thus
performing the work.
would rely on the City
some property owners would repair
reducing the ci ty' s cost of
The majority of property owners
to perform the work.
The City would save an estimated $50,000 annually.
d. Implementation
city Council would need to pass a resolution revising the
Sidewalk Repair Policy. Staff would need to notify
property owners of their responsibility for defective
sidewalks. If the property owner did not perform work,
city would perform work and bill property owner. If the
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bill was not paid, the city would need to place a lien on
the property subsequent to conducting a public hearing.
C. ASSESSMENTS
1. EMERGENCY MEDICAL SERVICE FIRST RESPONDER SERVICE - Revenue generated
- approximately $25,000
a. Description
In Alameda County, the Emergency Medical Services (EMS)
District is primarily responsible for providing basic and
advanced life support services throughout most of Alameda
County, including the City of Dublin. The Emergency
Medical Services District currently charges County
residents an assessment in order that these services can
be provided. The EMS District also currently allows
cities to request a supplemental assessment to be charged
to City residents to cover those services provided by the
fire departments which support the Emergency Medical
System response.
b. Cost of Service vs. Revenue
Fire Services are currently provided to the City of
Dublin by the Dougherty Regional Fire Authority (DRFA).
Those training costs incurred by DRFA which are
associated with the EMS system are eligible expenses to
be covered by a supplemental assessment. It is currently
estimated that uncovered training costs are approximately
$25,000 per year.
c. Revenues Generated from Assessments
The EMS District currently uses a formula to develop
District Assessments which are based upon the number of
benefit units in each service area. One benefit unit is
assigned to each single family resident. The formula
varies for non-residential property. The city of Dublin
is currently assigned 8,315 benefit units. DRFA could
charge approximately $3. aO/benefit unit/year to recover
EMS related training costs. This would reduce the city
of Dublin's contribution to DRFA by approximately
$25,000/year.
d. Implementation
The city of Dublin would need to request DRFA to consider
the matter by holding a public hearing. If the DRFA
Board concurred, it would adopt a resolution requesting
that the Alameda county Board of supervisors consider
levying a supplemental EMS assessment in the city of
Dublin. The Board of Supervisors could adopt, reject, or
modify the supplemental assessment. The request would
have to be submitted to the Board of supervisors prior to
April 15 in order to be effective for the following
fiscal year.
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2. ASSESSMENT FOR FIRE SUPPRESSION SERVICES - Revenue Generated would
vary depending upon assessment.
a. Description
Government Code Section 50078 authorizes a city or Fire
Authority to impose an assessment for fire suppression
services, including acquisi tion and maintenance of
equipment or apparatus and payment of salaries on all or
certain parcels of property.
b. Cost of Service vs. Revenue
Fire Service is provided to the city of Dublin and the
southern half of the City of San Ramon by the Dougherty
Regional Fire Authority. The Cities of Dublin and San
Ramon contribute from their respective General Funds
approximately 96% of the total Fire Authority Budget.
The city of Dublin's contribution to the Fire Authority
is shown below:
Fiscal Year Actual Amount % Inc.
1998-89 $1,808,323
1989-90 2,010,041 11. 1%
1990-91 2,233,302 11. 1%
1991-92 2,416,709 8.2%
1992-93 2,672,950* 9.6%
* Amount Budgeted
C. Revenue Generated from Assessments
Staff has not evaluated the most appropriate structure
for a fire suppression assessment; however, if the same
structure was used as is used for EMS, $8,315 would be
generated for each $1.00 per benefit unit.
d. Implementation
Ei ther the city or DRFA could impose an assessment for
fire suppression services.
To impose an assessment, the city Councilor DRFA must
hold two noticed public hearings. At least 45 days
public notice must be given of the public hearing at
which the city Council proposes to enact the assessment.
The notice must be sent to all property owners. If
property owners representing 5%, but less one third of
the expected revenue from the proposed assessment,
protest the assessment, an election is required, or the
assessment must be abandoned. If an election is
required, two thirds vote is required to approve the
assessment. If less than a 5% protest is received, the
legislative body can impose the assessment. If more than
one third of the property owners protest, the assessment
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must be abandoned. In order to collect the assessment,
the County Auditor would need to be notified by August of
each year.
3. street Liqhtinq & Landscape Assessment District - Revenue
Generated Varies upon Amount of Assessment
a. Description
The City currently has the authority to form assessment
districts under the 1972 street Lighting & Landscape
Assessment District for the purpose of acquiring,
installing, and maintaining landscaping, fountains,
public lighting facilities, traffic signals, and park and
recreational facilities. The city currently has an
assessment district for citywide street Lighting, and two
development specific assessment districts for
landscaping.
b. Cost of Services vs. Revenue
The amount of general fund monies budgeted by the city
for eligible services are as follows:
Traffic Signals
street Tree Maintenance
street Landscape Maintenance
Park Maintenance
$ 63,116
60,000
222,880
598.910
TOTAL
$944,906
c. Revenue Generated from Assessments
The amount of revenue that the city could generate from
this type of assessment district would be dependent upon
the amount of assessment levied each year. The
assessment would need to be based upon benefit. Assuming
the same benef it structure as ' the city's current street
Lighting Assessment District, a $36/year assessment would
generate an amount sufficient to fund street Tree and
Street Landscaping Maintenance costs presently incurred
by the General Fund (approximately $263,000).
d. Implementation
The City council would direct staff to prepare an
Engineer's Report inclUding a boundary map, cost
estimate, method of spread and proposed assessment. Once
those documents were presented to the city council, the
council would need to pass a resolution approving the
Preliminary Engineer'S Report and set two public
hearings. Notices are sent out to all property owners
within the proposed district (in this case, the whole
city). These notices must be sent out at least 45 days
in advance of the first hearing. The council would hold
two protest hearings. If a majority protest occurs
(property owners owning more than 50% of the area of
Page 12
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assessable lands submitting written protests), then the
district is abandoned. If there is no majority protest,
the council adopts a resolution approving the formation
of the district and the levy of assessments. staff
prepares computer tape of the assessments on each parcel
and delivers to Alameda county Auditor prior to the third
week of August.
D. UTILIZE CITY ASSETS TO GENERATE ADDITIONAL INCOME
1. LEASE CIVIC CENTER OFFICE SPACE
(See Assistant city Manager Memorandum dated February 19,
1993, Attachment 1.)
2. SELL/LEASE UNIMPROVED CIVIC CENTER PROPERTY
Approximately 4 acres of the civic center site is currently
unimproved. ApproximatelY 60%'of this site was purchased with
the proceeds of the civic center certificates of
participation. Before this site could be sold or leased, the
city would have to hire bond counsel to render an opinion as
to whether this property must continue to be held as security
for civic Center Certificate holders.
E. TAXES
1. TRANSIENT OCCUPANCY TAX - Additional Revenue approximately
$11,850 for Each 1% Increase
a. Description
The Transient occupancy Tax is imposed on the room
charges of hotels, motels, and other lodging facilities,
unless such occupancy is for more than 30 days (ReVenUe
and Taxation code section 7280 & 7281). Rates are set at
the City's discretion (Dublin's is currently 8%;
neighboring cities range from 6% to 8%).
b. Use of Tax Proceeds
May be used for any General Fund purpose.
c. potential Revenue
Projected revenue for FY 1992/93 is currently estimated
at $86,700. (FY 1991/92 was $94,000.) If we estimate FY
1993/94 revenue at $90,000 using the 8% rate, each
additional 1% would generate $11,250. There is no
maximum rate.
d. Implementation
The City council must hold two noticed public hearings.
At least 45 days public notice must be given of the
public hearings. The Notice must be published in a
newspaper of general circulation pursuant to Government
Page 13
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Code section 6063. The city's current Ordinance would
require modification.
2. UTILITY USERS TAXES - Additional Revenue varies depending upon
utilities taxed and amount of tax
a. Description
The utility User's Tax can be imposed on the consumer
(residential and/or business) of any combination of
utility (electric, gas, cable television, water and
telephone services). The city's authority comes from
Section 37100.5 of the Government code. The tax is based
on a percentage of the net charges by the utility
companies and is collected by them as a part of their
monthly billing.
b. Use of Tax Proceeds
The tax proceeds can be used for any General Fund
purpose.
c. Potential Revenue
The utility Users Tax has been used by numerous cities
throughout the state. Tax rates range from 1% to 11%,
but in most cases the rate is 5.5%. Alameda County and
eight north county cities have adopted such a tax.
Staff has obtained gross
major utilities (gas
telephone services) and
estimates:
receipt information on the two
& electric, and intra-state
submits the following revenue
GAS & ELECTRICITY
TOTAL
Gross Receipts 1% Tax 5.5% Tax
$10,394,000 $103,940 $ 571,670
3,516,000 35,160 193,380
9.793,000 97,930 538,615
$23,703,000 $237,030 $1,303,665
Commercial/Industrial
Government/Schools
Residential
TELEPHONE SERVICES
TOTAL
$10,300,000
$103.000
S 566,500
potential Taxes.
$340,030
$1,870,165
A variety of exemptions and maximum tax provision have
been used by taxing cities on their policies, e. g. low
income consumers, etc. , which could lower these
projections if the council made such exemptions.
d. Implementation
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The city council must adopt an ordinance (preferably
based on a model worked out between the League of
California Cities and the utility companies.) The
process for adopting a utility users tax is similar to
the process identified above for the Transient occupancy
Tax.
Additionally, once the tax ordinance is adopted, the
utility company requires 60 days to establish the tax in
their billing process. Another 45 days should be allowed
before the first month's billings and collections are
paid to the City.
3. REAL DOCUMENTARY TRANSFER TAX - Additional Revenue varies upon
amount of tax increase
a. Description
The city currently has an ordinance which imposes a tax
of $0.27 per $500 ($0.55 per $1,000) value on the
transfer of real property in the city. Nine of the
Cities in Alameda County have Real Documentary Transfer
Taxes which vary from $1.10 per $1,000 value to $15.00
per $1,000 value (See Attachment #2).
b. Use of Tax Proceeds
The tax proceeds 'can be used for any General Fund
purpose.
c. potential Revenue
Additional revenue from an increase in this tax depends
upon the number and the amount of transactions. The
slump in housing sales reflects the decrease experienced
by the city in recent years.
Fiscal Year
Actual Revenue
1991-92
1990-91
1989-90
1988-89
1987-88
$ 62,319
$ 67,577
$ 70,935
$104,766
$ 99,480
If the city were to increase its real property transfer
tax rate equal to the cities of Livermore and Pleasanton
($1.10/$1,000 of value), an additional $60,000 to
$100,000 per year in revenue could be generated depending
upon the state of real estate sales.
d. Implementation
The city council would need to amend its current
Ordinance in the same manner as described above under the
Transient Occupancy Tax.
Page 15
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F. OTHER
1. LIBRARY SERVICE FUNDING - Revenue Generated - The city's current
subsidy could be covered
a. Description
Library Service is currently provided to the city of
Dublin by the county Library system; however, the city of
Dublin subsidizes the County in order that the Library
can remain open 19 hours more than the County can fund.
b. Cost of service
The cost to the city of Dublin of subsidizing the County
Library System is $164,870 in Fiscal Year 1992-93.
c. Revenue options
The County is currently exploring with those cities that
are served by the County Library System the possibility
of implementing a special tax, which is currently
permitted under state law, or Library Benefit Assessment,
which is being considered by the state legislature.
d. Implementation
Depending on the outcome
to indicate to the County
should take in funding
Dublin.
of SB 566, the city would need
what action, if any, the County
additional library hours in
2. ENHANCE COLLECTIONS - Revenue Generated - Up to $8,650
a. Description
The City has ninety-one outstanding accounts receivable
as of February 28, 1993, which are unresponsive to Staff
correspondence and are less than two years old, totalling
$23,188. These billings relate to damage to city
property (average billing $1,189) and DUI arrest costs
(average billing $126).
Two forms of professional collection assistance are
available: One is a letter series which would handle up
to 100 accounts for approximately $1,000; the second is a
more aggressive collection agency which would receive up
to 50% of collections generated.
b. Use of Revenue
Any collections on the above accounts, net of collection
costs, would be General Fund revenue available for
appropriation.
Page 16
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c. Potential Revenue
Our best estimate of revenue (net of collection costs)
are as follows:
1) Letter Series:
20 (of 80) accounts x $126
4 (of 11) accounts x $1,189
Less - cost of service
$ 2,520
$ 4,756
$(1.000)
$ 6,276
NET TO CITY
2) Collection Agency:
4 (of 11) accounts x $1,189
Less - cost of service (50%)
$ 4,756
$(2,378)
NET TO CITY
$ 2,378
TOTAL RECOVERED BY CITY
$ 8,654
d. Implementation
staff would recommend specific firms for the services
described above. The city Attorney would coordinate an
appropriate contract with the firms. The city council
would approve these and authorize the overall collection
program.
a:Revnoptn.doc.rca#9
page 17
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.
t'
CITY OF DUBLIN
MEMORANDUM
. .. .-- ...--- - _&..-.----.,--- ---- ----------- ----
--.-.- ..- --.- --- ,...- .
TO: n\~}Richard C. Ambrose, City Manager
FROM:~pauI S. Rankin, Assistant City Manager
SUBJECT: Unimproved Civic Center Office Space
DATE:
February 19, 1993
INTERIOR
The interior of the City Office wing currently has approximately 4,580
square feet of vacant shell space. This is split up in the following
sections:
1st Floor - 2,650
2nd Floor - 1,930
TYPES OF TENANT IMPROVEMENTS
I consulted with Bill Hoffmann, George Miers & Associates, regarding the
cost of tenant improvements. Mr. Hoffmann also reviewed the rough
estimate with their Cost Estimate Consultant. Basically, there are
three grades of improvements which 'could be considered:
Grade A _ This would be consistent with the types of finishes found
in the existing building and particularly the City Manager Office
Area. It would assume provision of several individual offices.
==
$40 - $50 per square foot
$45
Range
Average
=
Grade B _ This would continue to provide finishes typical of a
Class A Office Building. The primary difference is that it would
rely more on "open office area" and partitions provided by the
tenant.
=
$30 - $40 per square foot
$35
Range
Average
==
Grade C _ This would be a situation where the improvements were of
a low quality (i.e. carpet/ceiling system/etc.). The estimate
assumes that the tenant would supply mostly partitions.
Range
=
$20 - $25 per square foot
For the purpose of this analysis, it would appear appropriate to assume
that the cost of improvements would range between $35 and $45 per square
foot.
A'ITACHMENT 1
.
.
CAPITAL COST TO OUTFIT TENANT AREA
Based upon the total area available, the construction cost of
improvements would be $160,300 - $206,100. In addition, there would
be design costs incurred to construct the improvements. Assuming that
design services were in the range of 10%, this would add between
$16,030 and $20,610 to the cost. This would need to be considered
since the tenant space would be serviced by electrical and mechanical
systems serving the remainder of the building.
The other area affecting the city would be administrative costs
associated with coordinating the lease as well as any construction
agreements. A rough estimate of the Staff time required would be
$10,000 - $15,000. This is only an estimate and is based upon
discussions with the public Works Director.
To summarize, the estimated capital Expense consists of:
Construction Cost:
Design Costs:
Project Coordination:
$160,300 - $206,100
$ 16,030 - $ 20,610
$ 10,000 - $ 15,000
Total Estimate
$186,330
$241,710
Ooeratinq Cost
It is typical in most office leases of a portion of a large building,
for the Building Owner to provide utilities and maintenance. At the
time that Congressman Baker's lease was negotiated, I estimated these
costs at approximately 38 cents per square foot per month. This
included:
. utilities (Electric/Gas/Water & Sewer)
. contract Cleaning and Maintenance
. Maintenance supplies
. contract Mechanical (Elevator/Fire Alarms)
. Property Insurance
Based upon this estimate, the annual cost for the entire 4,580 square
feet would be:
$.38 x 12 = $4.56 x 4,580 sq. ft. = $20,885/year
POTENTIAL FOR COST RECOVERY
It is assumed that the figures indicated in this report are
conservative. For example, no consideration is given to the cost of
money. Also, the assumed operating costs have not been escalated for
inflation. If you assume only 3% inflation per year, the operating
costs in the 5th year of an agreement would be 12.5% greater than in
year 1. For the purpose of this analysis, no inflation factor has
been imposed.
.
.
year 1. For the purpose of this analysis, no inflation factor has been
imposed.
The following summarizes the potential cost recovery in a 5-year lease
scenario:
Total Square Footage: 4,580 square feet
Projected Monthly Rent Revenue: $1.00/sq. ft. - $1.20/sq. ft.
Annual Rent Revenue: $54,960 - $65,950
Total Costs
5-year Expense Subtotal
$186,330 - $241,710
$104.425 - $104.425
$290,755 - $346,135
Improvements
Operating Costs @ $20,885 x 5
Straight Line Recovery
@ $1 .OO/square foot
5.3 years - 6.3 years
straight Line Recovery
@ $1 .20/square foot
4.4 years - 5.3 years
As you can see, this type of project is unlikely to generate a revenue
stream for the City, especially once inflationary costs are calculated
in- the operating cost factors. As a public entity, there are not any
tax incentives in the form of depreciation or other factors to make this
a profitable undertaking. Also, typically, the type of tenant which
would be the most compatible would be a public or quasi-public agency.
The interest of providing public services usually impacts the pricing of
this type of use and avoids achieving true market rates.
CONCLUSION
It is my conclusion that the internal expansion space should be viewed
as an investment by the City to accommodate future growth or new
services at the time that it becomes necessary.
PSR/lss a:218Expan.doc.psr
-3-
.
.
REAL DCCUMENTARY TRANSFER TAX SURVEY
Property Transfer Tax -
1990/91 Per $1.000
Revenue Total County Cities
Cities Class Collected Rate Amount Amount
Alameda Chartered 1.012.533 5.50 1.10 4.40
I
Albanv Chartered 212.976 7.50 1.10 6.40
Be~elev Chartered 2.318.010 16.10 1.10 15.00
Dublin General Law 67 577 1.10 0.55 0.55
Emervville General Law 28 012 1.10 0.55 0.55 .
I
Fremont General Law 597 548 1.10 0.55 0.55
Havward Chartered 285 809 5.60 1.10 4.50
Livermore General Law 219.969 2.20 1.10 1.10
N~u.)a r k.. i],p/'"\,:>...... j Ih....' /./0 (). .::>5 O.SS
Oakland Chartered 10242526 13.60 1.10 12.50
Piedmont Chartered 384.494 7.60 1.10 6.50
Pleasanton General Law 263.933 2.20 '1.10 1.10 :
I
San Leandro I Chartered 402.611 3.10 1.10 2.00
Union City General Law 103.018 1.10 0.55 ..~
ATTACHMENT 2