Item 09 - Rental Registry Fee Study

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Pg. 09 CHAPTER I – THE NEED FOR USER FEES City of Santa Ana Rent Stabilization Program Fee – March 2023 from, the governmental activity. For example, a fee on liquor store owners to fund an alcohol education program would not be allowed. While Proposition 26 was built on the foundations of Propositions 4 and 218, it provided a sharper definition of the reach and limits of service fees, and the courts have looked to it when reviewing fee challenges. Legal Approach to User Fees This Fee Study presents the analytical advantages which are available to the City through the institution of a comprehensive system designed by RCS to implement Article XIIIB of the California Constitution. Systematic and Documented Approach. This analysis was designed to provide the City with a systematic and documented approach to understand, control, and recapture the costs which are forced on it by normal service demands, growth and general economic inflation. Constitutional Methodology. The methodology used for this analysis is the "costs reasonably borne" test established by Section 8(c) of Proposition 4, now Article XIIIB of the California Constitution. In following that process, RCS has analyzed the ways in which City services can be financed more equitably to assure the City's future financial viability. Full Business Costs Determined. The methodology followed by both the Authors of Proposition 4, and consequently by RCS, determines the full business cost of providing the reported City services. It also identifies the beneficiaries of those services and determines if they are paying in relationship to benefits derived or if they are deserving of a subsidy paid from the taxes paid by all local citizens and businesses. Thus, the City Council will have full knowledge and cannot ignore costs which are actually occurring. Financial Integrity Established. This text summarizes the work accomplished and presents recommendations. These recommendations, if implemented, would firmly establish the financial integrity of the analyzed City services and would establish a continuing cost control system following the business principles which are generally espoused for government, but often are ignored in application.