Title
Subject: Fees and Charges Policy
From: Financial Services Agency
Recommendation: Adopt a Resolution regarding the policy on charges for the City of Oakland's services
Body
CITY OF OAKLANW'_,.-,1'-'-@
A GEIVDA REPORT
N
TO: Office of the City Manager
ATTN: Robert C. Bobb
FROM: Bucluet Office
DATE: June 24, 2003
RE: Adoption of Financial Policy on Char-es for City Services
SUMMARY
This report proposes a formal policy on char.ges for Citx services and recommends that the Council
adopt that policy. It is a follow up to an informational report presented to the Council on Februarv 18.
2003. That report presented the recommendations of the Moving Oakland Forward (MOF) Team
#4A, on the adoption of a comprehensive set of financial policies by the City. The Council requested
that staff provide more detailed analysis and recommendations regarding each proposed policv@ this
report is a response to that Council request. Charges include both rates and fees. Services include the
City's personnel, facilities and equipment.
There is an existing Administrative Instruction reuardina the City's Master Fee Schedule. The
purpose of this report is to formalize the policies contained in that existing Administrative Instruction,
through a formal adoption by the Council as part of a comprehensive set of financial policies.
FISCAL IMPACT
There will be no direct fiscal impact as a result of adopting the proposed policy. However, a formal
policy on fees and charges would: I) provide equity in distributing the cost burden for City services
on the beneficiary and the taxpaver, consistent with Sound fiscal and management principles@ and 2)
provide for charges that reflert the cost. when deemed appropriate by the City Council, of services
provided by the City of Oakland.
BACKGROUND
The City's Master Fee Schedule was established in 1976. It contains all char.-es for City services.
Procedures regarding the Master Fee Schedule are now contained in an Administrative Instruction, but
these procedures have never been formally adopted by the Council.
Team 44A of Moving Oakland Forward was established to review and make recommendations
regarding the City's financial policies. One of Team 94A's findings was that the City's current
financial policies are not consolidated under one authority. and cannot be found in a single location:
some are Cotincil-adopted. some are reflected within Administrative Instructions, and others are
followed in practice but lack formal aUth0fit.V.
Item 10. Z41 cc, lie
ORA/Council Fina agemen
July 15, 2003 003
Financial Polin on Charg-es for Cin; Services Page 2
In September 2002, Team #4A presented a report recommending steps the City should take in order to
adopt and consolidate a comprehensive set of financial policies, and a process for staff to report to the
Council on the extent to which City operations are in compliance x@,ith these policies. Financial policy
on charges for City services was one of the policies recommended for formal adoption by the Council.
KEY ISSUES AND IMPACTS
Approval of the policies contained in the attached resolution would allow the City to move one step
closer to its aoal of havin- Council adopt a comprehensive set of financiai policies.
DISCUSSION OF PROPOSED POLICY
Purpose
The Master Fee Schedule (MFS) contains a comprehensive listing of all rates arid fees charged for
City of Oakland services. Services include personnel, facilities and equipment. The purpose of the
WS is to provide easier access to these charges, both for decision makers and for the general public.
In addition, the MFS is an aid in equitably distributing the cost burden of City services to taxpayers
and service recipients.
Responsibilities
The Citv Mana-er shall be responsible for the maintenance and control of the NITS. The City
Manager shall review all requests for adding to, deleting, or modifying char-es or policy in the NITS.
Other departments are responsible for notifyin the City Manager about all of its existin@ charces.
They are also responsible for keeping updated copies of the MFS available and in clear display for the
public. Departments are to propose charges that reflect the cost of services provided by the City.
These responsibilities currently are performed by the Budget Office under the City Manager
supervision and control.
Annual Review and Approval
There are two procedures for revising the MFS: 1) during the budget process, departments submit
changes as part of their budget proposal. Changes that are approved by the City Manager are
incorporated into the budget that is presented to the Council, and if approved bv the Council. the
chan-es are included in the legislation adopting the budget- 2) at other times of the vear, a department
may submit a proposed change by memorandum to the Budget Director for review. If approved, the
change is forwarded to the City Manager, and if approved at that level, the change is presented to the
Council in the form of an ordinance amendment.
SUSTAINABLE OPPORTUNITIES
Adoption of the charges for services policy would not directly impact economic. environmental or
social equity opportunities. However. a formal policy on fees and char.-cs Aould: 1) provide equitv in
Financial Polici, on Charges.for Cit) Services Pa@ae 3
distributina the cost burden for Citv services on the beneficiary and the taxpaver, consistent with
sound fiscal and mana.gentent principles: and 2) provide for char.ges that reflect the cost. when deemed
appropriate by the City Council. of services provided by the City of Oak-land.
DISABILITY AND SENIOR CITIZEN ACCESS
Adoption of the charges for services policy would not directly impact disability or senior citizen
access.
ACTION REQUESTED OF THE CITY COUNCIL
Staff recommends that the Council adopt the attached resolution containing a financial policy on
charges for City services.
Respectfully submitted,
ARIANNA MARV'HEVA
ACTING BUDGET DIRECTOR
Prepared by:
Kirby Smith, Financial Analyst
Bud,-et Office
APPROVED FOR FORWARDING TO THE
FINANCE AND MANAGEMENT COMMITTEE:
Item A--f-WX
ORA/Council
4614 July 15, 2003
OFFICE OF THE CITY MANAGER
FINANCE ENT GMTE
2 4
APPR0% EDAS.10 FORAI A,\=WT)
F\TRODUCED 8@ CM:\CLLN1E.\1BER
@C h
)FFICr
-@ 7 .@ E,C ;Tf cLERK.
OAKLAND CITY COUNCIL
2PM 5: 0 7
RESOLUTION No. C. M. S.
RESOLUTION ADOPTING A POLICY ON CHARGES FOR THE CITY OF
OAKLAND'S SERVICES
WHEREAS, a Master Fee Schedule for the City of Oakland was established in
1976 and has been maintained since that date, with changes approved by Council; and
WHEREAS, the Master Fee Schedule allows the public and City staff to obtain a
better understanding of all fees, rates and permits charged by the City of Oakland; and
WHEREAS, existing procedures and responsibilities regarding the Master Fee
Schedule are contained in the City's Administrative Instruction 19, but have never been
formally adopted by the City Council; and
WHEREAS, it is the goal of the City that all financial policies of the City of
Oakland be consolidated and formally approved by the City Council; now therefore be it
RESOLVED: that the City Council of the City of Oakland hereby finds,
determines, declares and resolves as follows:
Section 1. All of the recitals set forth above are true and correct
Section 2. The City Council hereby adopts a policy on fees and charges as set
forth below:
POLICY ON CHARGES FOR THE CITY OF OAKLAND'S SERVICES
1. Purpose
This policy states procedures and regulations to be followed regarding charges for the
City of Oakland services.
H. Applicable Legislation
The Master Fee Schedule was established by the City Council in Ordinance No. 9336
C. M.S. on June 29, 1976. in order to:
I Provide easier access Ic and a better understanding by the public of ali the @ty
I -gl
of Oakland's charges for service; Item Aw. 7-4 M
ORA/Council
July 15,2003
I
z Provide equity in distributing the cost burden for City services on the beneficiary
and the taxpayer, consistent with sound fiscal and management principles;
3. Provide for charges that reflect the cost, when deemed appropriate by the City
Council, of services provided by the City of Oakland. Services include personnel,
facilities, or equipment.
4. Provide for annual revision of charges.
At the same meeting, the Council passed Ordinance No. 9337, C.M.S. which amended
or repealed certain sections of Oakland City Codes and certain ordinances and
resolutions, as necessary, to effect the Master Fee Schedule. The effect of this
ordinance was to delete or amend any existing references to charges or charge policy.
Any charges or charge policies are to appear only in the Master Fee Schedule.
Ill. General Responsibilities
City Manage
The City Manager, shall be responsible for the general maintenance and control of the
Master Fee Schedule, including, but not limited to@
1 . The review of all requests for the addition to, or the deletion, or modification of
charges or policies in the Master Fee Schedule;
2. The maintenance of the Master Fee Schedule, including annual revisions and
reprinting of the document, upon Council approval of modifications;
3. Ensuring that ordinances passed into law which affect the City's charges become
part of the Master Fee Schedule; and
4. Reviewing the City's charges on a regular basis to make certain: 1) that they
reflect the cost of services provided by the City; and 2) that they provide equity in
distributing the cost burden onto the service recipient and the taxpayers,
consistent with sound fiscal and management principles.
These responsibilities currently are performed by the Budget Office under the City
Manager supervision and control.
Other Deoartments
All agencies/departments that levy charges on the public shall be responsible to the City
Manager for:
1 . Including all charges which are levied on the public in the Master Fee
Schedule;
2. Keeping updated copies of the Master Fee Schedule available and in clear
display for the public;
2
3 . Proposing fees which reflect the cost of services provided by the City; and
4. Reviewing their charges annually, or upon changes in the cost of providing
service (such as union-negotiated increases), and proposing changes in
charges consistent with the intent of the Master Fee Schedule.
IV. Annual Review and Approval
The City Manager shall be responsible for coordinating an annual review of the Master
Fee Schedule in conjunction with the two-year budget or mid-cycle budget. The
purposes of the review are: 1) to adjust charges to reflect changes in the cost of
providing services: 2) implement new charges; and 3) delete charges that are no longer
used. Although the need for charge modifications should be methodically considered
during the annual update, this should not be construed to preclude the implementation
of new charges at any time during the year.
Every year during the budget process (May-June), the City Manager, shall prepare an
agenda report for the City Council, outlining modifications to charges proposed for the
following year, with anticipated revenue changes by department. The agenda report
must be accompanied by an ordinance reflecting the proposed changes, for Council
consideration and approval. The Council shall approve any proposed changes by July
1 of the fiscal year for which the proposed changes are proposed.
The Budget Office, under the direction and supervision of the City Manager currently
performs these functions.
In Council, Oakland, California, 2003
PASSED BY THE FOLLOWING VOTE:
Ayes- BROOKS, BRUNNER, CHANG, NADEL. QUAN, REID, WAN AND
PRESIDENT DE LA FUENTE
Noes-
Absent-
Abstention-
Item 110 . zu/ CO_
ORA/Council
July 15,2003
3