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    24.    
City Council Regular
Meeting Date: 02/27/2018  

SUBJECT:
REVISED/NEW FINANCE FEES
RECOMMENDATION:
Conduct a public hearing, consider evidence, and adopt a resolution entitled: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHINO HILLS, AMENDING THE MASTER SCHEDULE OF FEES SET FORTH IN RESOLUTION NO. 2018R-028 BY REVISING CERTAIN FINANCE AND DEVELOPMENT SERVICES FEES AND DETERMINING THAT THE ADOPTION OF THE FEES IS EXEMPT FROM REVIEW UNDER THE CALIFORNIA ENVIRONMENTAL QUALITY ACT.
BACKGROUND/ANALYSIS:
On November 14, 2017, the City Council approved an agreement with HdL Software, LLC (HdL) to provide business license and TOT operations management services.  As a result, the following changes to the Master Schedule of Fees are proposed:
  • Business License Application Fee - HdL charges $14 to process a business license application and Community Development staff will continue to review the application for businesses physically located in Chino Hills before sending it to HdL.  Staff is proposing to break out the Zoning Clearance component of the Business License Application which would result in a Zoning Clearance Fee of $77 and a Business License Application Fee of $16.  The total cost of these combined will remain at the current $93, but the Zoning Clearance will only apply to businesses within city limits. 
  • Business License Renewal Fee - HdL charges $14 to process a business license renewal.  To ensure full cost recovery, staff is proposing to increase the Annual Renewal Fee from $10 to $14.  This new service provides an online renewal process.
  • Sale of Documents Fee - Staff is proposing to remove the Sale of Documents fees from the Finance Fees because they are already located in the Miscellaneous Fees section. 
  • Modification to License Fee - This fee is no longer needed because any new registration or new license would fall under the application fee.  Any other changes are minor and a fee would not be charged. 
  • Disability Access Fee - Effective January 1, 2018, AB 1379 (previously SB 1186) increased the disability access fee to $4, which was previously $1.  This is informational only.
  • Convenience Fee - This fee would recoup the cost of processing business license and TOT payments via debit/credit cards online.  The City will still cover the cost of processing an e-check so customers still have a free option of payment. 

The Finance Department is also proposing the following new fees:

  • Collection Agency Fee - This fee would pass the cost of the third party collection agency costs onto the delinquent customer that is being sent to collections.  The City's collection agency fees are 18%-25% for utility billing/miscellaneous accounts and 30% for citations.
  • Credit Card Service Fee - This fee would pass through the bank credit card fees and interchange fees associated with transactions processed via credit card.  The fee quoted by Wells Fargo to be a part of the service fee program is 2.5%.  The service fee program is a card brand sponsored program not offered on utility transactions, but the City does take advantage of the utility discount rate program.  
Public Notice
A notice regarding the amending of fees was mailed to interested parties on February 13, 2018.  On February 16, 2018, the proposed fee schedule and the Finance Fee Study that shows the calculations supporting the fees was made available for public review.  A public notice was published on February 17, 2018, and on February 24, 2018, in the Chino Hills Champion newspaper. 

Effective Date
The Government Code §66017 requires that certain fees, such as the Zoning Clearance Fee, shall be effective no sooner than 60 days following the adoption of the fee or charge or increase in the fee or charge.  It is recommended that the fees under consideration in the proposed Resolution be effective May 1, 2018. This will enable staff sufficient time to update forms, applications, and computer software as necessary for the implementation of the fees.
ENVIRONMENTAL (CEQA) REVIEW:
This proposed action is exempt from review under the California Environmental Quality Act (California Public Resources Code §§ 21000, et seq; “CEQA”) and CEQA regulations (14 California Code Regulations §§15000, et seq.) because it does not involve any commitment to a specific project which could result in a potentially significant physical impact on the environment; and constitutes an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. Accordingly, this action does not constitute a “project” that requires environmental review (see specifically 14 CCR § 15378(b)(4-5)).
FISCAL IMPACT:
Approval of the Resolution amending the Master Schedule of Fees will decrease expenditures by approximately $20,000.  
REVIEWED BY OTHERS:
This agenda item has been reviewed by the Community Development Director and the City Attorney.
Attachments
Resolution
Finance Fee Study

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