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Planning & Land Use Development Fees to be Proposed for Updating to Recover City Costs to be Considered at the 12/17/2018 City Council Meeting

Posted on December 6, 2018


As part of its land use policies, the City’s Planning & Community Services Department processes development applications and various other regulatory permits. Some of these permits are administrative and are approved by staff. The majority of them, however, require review by the Planning Commission or the Design Review and Historical Preservation Commission. A review by City staff found that the fees charged for Planning services were extremely low, are low compared for the same services provided in other local communities, and have not been increased for many years. In addition, the current application fees did not reflect the best practice of using deposits for larger projects to ensure that the applicant is covering the costs for their projects. From staff’s research, every other city in Sonoma County utilizes deposits and has higher cost recovery.

The City hired Matrix Consulting Group to conduct a study of Planning application fees. The Matrix Consulting Group analyzed the cost of service relationships that exist between fees for service activities in the Planning and Community Services Department. The results of this Study provide a tool for understanding current service levels, the cost and demand for those services, and what fees for service can be charged. The study also provides recommendations regarding conversion to deposit-based fees for planning services as well as associated policies and procedures.

The methodology employed by the Matrix Consulting Group is a widely accepted “bottom up” approach to cost analysis, where time spent per unit of fee activity is determined for each position within a Department. Once time spent for a fee activity is determined, all applicable City costs are then considered in the calculation of the “full” cost of providing each service. The full cost includes the direct cost of salary, benefits and any allowable expenditures plus the indirect costs attributable to the Planning and Community Services Department through the City’s adopted Cost Allocation Plan. The analysis shows that the Planning and Community Services Department is significantly undercharging for all fees. The study estimates that the City is under-recovering its costs by approximately $550,000 and the City’s overall cost recovery for Planning services is currently 15%. Typical cost recovery for Planning services is between 50% and 80%.

It is generally accepted in California that cities are granted the authority to charge user fees and regulatory fees for services and activities. For a fee to qualify as such, it must relate to a service or activity under the control of the individual/entity on which the fee is charged. The fee charged for any city services, including Planning fees may not exceed the estimated reasonable cost of providing the service or performing the activity.

The City Council received a presentation regarding draft findings from Matrix Consulting Group at the June 25th, 2018, Council meeting. The City Council appointed Council Member Hundley and Council Member Cook to serve on an Ad-Hoc Council Sub-Committee to review the draft fees and work with staff.

The final report and fee recommendations will be considered by the City Council at the December 17th , 2018, City Council meeting. State law requires that the Report on the Cost of Services (User Fee) Study for the Planning and Community Services Department and proposed Planning Fee Schedule be made available to the public 10 days ahead of the public body’s consideration.

Final Planning Fees Report

Planning Fees 12-07-2018 News Posting

For further information or questions, please contact David Storer, Planning and Community Services Director, at dstorer@sonomacity.org or 707-933-2201.

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