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REQUEST FOR <br />COUNCIL ACTION <br />CITY COUNCIL. MEETING DATE: <br />MARCH 2, 2009 <br />TITLE: <br />PUBLIC HEARING - ORDINANCE <br />CREATING NEW APPLICATION <br />PROCESSING FEE FOR MODIFICATION OF <br />HISTORIC STRUCTURES AND RESOLUTION <br />TO ESTABLISH AND UPDATE VARIOUS <br />DEVELOPMENT PROCESSING FEE AMOUNTS <br />/_~ sue, <br />CITY MANAGER <br />RECOMMENDED ACTION <br />CLERK OF COUNCIL USE ONLY: <br />APPROVED <br />^ As Recommended <br />^ As Amended <br />^ Ordinance on 15f Reading <br />^ Ordinance on 2nd Reading <br />^ Implementing Resolution <br />^ Set Public Hearing For <br />CONTINUED TO ~~~-/( C~~ <br />FILE NUMBER <br />1. Adopt an ordinance creating a new application processing fee for <br />exterior modification of historic structures. <br />2. Adopt a resolution establishing and updating various development <br />processing fee amounts. <br />DISCUSSION <br />On May 7, 2007, City Council approved an agreement with MGT of America, <br />Inc. (MGT) for a study of the City's General Fund development processing <br />fees in order to analyze the cost of providing these City services <br />(Exhibit 1). The consultant's analysis was prepared in accordance with <br />generally accepted accounting principles (GAAP) as recognized by the <br />Governmental Accounting Standards Board (GASB) The study included an <br />analysis of staff time spent on the various development applications, as <br />well as a thorough analysis of all indirect costs of City agencies in the <br />support of these services. Such an analysis is important because it <br />establishes a baseline from which to update the development processing <br />fee schedule. State law authorizes cities to recover costs associated <br />with processing development applications. <br />Historically, building permit fees in California cities were established <br />based on the valuation of the construction project. More recently, <br />however, numerous court decisions indicate that valuation based fees do <br />not satisfy the state requirement to show the connection, or nexus, <br />between the fee amount and project value. Consequently, cities <br />throughout the state continue to move away from this methodology in favor <br />of one based on a comprehensive analysis of actual costs. The MGT <br />analysis follows this more rigorous methodology. <br />75B-1 <br />