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Pg. 22 CHAPTER IV - COST RECOVERY RECOMMENDATIONS <br />CHAPTER IV - COST RECOVERY <br />RECOMMENDATIONS <br />User Fee versus Tax <br />The Rent Stabilization Program meets the three criteria of a user fee, based on the following: <br />1) The customer is identifiable <br />2) The service is measurable <br />3) The service benefits the individual or group <br />A tax -based service typically benefits the community as a whole. Police service is a good example <br />of a tax -based service, because it cannot meet the three criteria of a user fee and requires tax <br />revenues to operate. <br />Fee Options <br />The Study shows that the service times involved are reasonable. With the amount of activity <br />projected, staffing the Rent Stabilization Program with 14.4 full-time equivalent city employees is <br />appropriate and reasonable for the City of Santa Ana. The Program's budget is $3.24 Million. <br />Based upon this Fee Study, RCS recommends Option 1 below: <br />Option 1: Single Rental Registry Fee (Petition Fees Included in the Rental Registry Fee) <br />Fee Title Suggested Fee = # of Units = Revenue <br />........... .......................................................................................................................................................................... <br />Annual Registration $100 per unit 32,450 1 $3,245,000 <br />After timely payment of the Rental Registry Fee, the landlord may pass through up to fifty <br />percent (50%) of the Rental Registry Fee to tenants of the applicable rental unit, to be paid <br />by the tenant in twelve (12) equal monthly installments (Section 8-3161(d)). This is equal to <br />$4.17 per month to be paid by the tenant. <br />Options 2 and 3 below were developed to meet the request of the City Council to present the <br />following options as it relates to the fees associated with a Fair Return Petition, Capital <br />Improvement Petition, and Tenant Petition: <br />Option 1. Financial impact of having petition fees included in the Rental Registry Fee; <br />Option 2. Financial impact of having petition fees separate from the Rental Registry Fee; or <br />Option 3. Financial impact of having no petition fees. <br />arch 2023 <br />City Council — / 23 <br />