That the City Council: Approve and adopt RESOLUTION NO. CC 2024-__ ENTITLED:  A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LA HABRA, ORANGE COUNTY, CALIFORNIA AMENDING THE MASTER SCHEDULE OF FEES PERTAINING TO FEES FOR GENERAL SERVICES, ADMINISTRATIVE SERVICES, COMMUNITY DEVELOPMENT SERVICES, BUILDING SERVICES, FIRE SERVICES, POLICE SERVICES, AMBULANCE SERVICES, PUBLIC WORKS SERVICES, UTILITY SERVICES AND PENALTIES FOR MUNICIPAL CODE AND VEHICLE CODE PARKING VIOLATIONS.

Section 4.08.010 of the La Habra Municipal Code allows the City to adjust various fees and charges it assesses for services by the increase or decrease in the Bureau of Labor Statistics Consumer Price Index for all Urban Consumers. The Consumer Price Index (CPI) for the Los Angeles-Long Beach-Anaheim “all items” has been used by the City as the benchmark for these annual adjustments. The CPI change for this index in 2023 was 3.48 percent higher than 2022; therefore, it is recommended that eligible user fees contained in the Master Schedule of Fees be increased by 3.48 percent, rounded to the nearest whole dollar. 

Some fees contained in the Master Schedule of Fees may not be adjusted by the Consumer Price Index. These include fees related to Enterprise Funds (water, sewer, refuse), franchises (such as cable, pipelines, etc.), or fees for which the State sets the rate. These fees, while listed in the Master Schedule of Fees, remain at the levels, rates and formulas previously authorized by City Council or other governing law.

User fees listed in the Master Schedule of Fees were most recently set in Fiscal Year 2015-2016, after the completion of a comprehensive user fee study to determine the actual cost of providing the services that the fees paid for.  Under state law, fees may only be set in an amount not to exceed the actual cost of providing the service for which the fee is being assessed.  The cost to provide the service is based on factors such as personnel costs, materials, personnel time, and overhead.
 
In addition to CPI adjustments for eligible fees, staff in the La Habra Police Department Animal Control division is recommending an increase to the City's pet licensing fee for non-neutered animals from $103 to $159. Over recent years, the costs associated with providing animal control services have steadily increased. These expenses include not only the cost of animal control staff and operations, but also for veterinary services and the cost to the City for its sheltering contract with the Inland Valley Humane Society for injured and stray animals. By adjusting the licensing fee for non-neutered animals, the City can ensure that the community continues to receive quality animal control services while also adequately supporting the financial cost of animal control operations and the animal sheltering contract. There are no adjustments currently being proposed to animal licensing fees for neutered animals, which will remain at $32 for a one-year license.

If approved by City Council, the increase in revenue from CPI adjustments and the pet license fee for non-neutered animals will result in additional resources for the City’s General Fund; however, these new revenues will be used to directly offset the existing costs currently being incurred by the City’s General Fund to provide those specific services. While it is not known at this time how much additional fee revenue will be generated by the CPI adjustment, staff does estimate that the increase to the non-neutered animal license fee will generate approximately $37,000 more per year for the City to help offset Animal Control operations and costs. Fee adjustments will become effective immediately upon passage of the resolution, with the exception of Community Development and certain Public Works related fees, which, consistent with State law, will become effective 60 days after passage of the resolution.

ED 9.1 – Balanced Fiscal Practices

It is also consistent with the following City Council Goals and Objectives:
Goal 2: Management of Public Revenues and Fiscal Assets
Objective A: Closely monitor revenues, expenditures, and fiscal trends to ensure the City's long-term fiscal stability.