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  Time Set   # 35.       
  
Meeting Date: 12/07/2021  
Brief Title:    Update to FY21-22 Master Fee Resolution
From: Tom Haynes, Interim Chief Financial Officer, Department of Financial Services
Staff Contact: Melissa Patterson, Chief Budget Official, Department of Financial Services

Subject
Hold a public hearing and approve an update to the fiscal year 2021-22 Master Fee Resolution related to proposed fee changes associated with the Agriculture, Assessor/Clerk-Recorder/Elections, Community Services, and Financial Services departments, and the Health & Human Services Agency. (General fund revenue increase: $163,275) (Haynes/Patterson)
Recommended Action
  1. Hold a public hearing;
     
  2. Approve an update to the FY21-22 Master Fee Resolution (Attachment A); and
     
  3. Approve proposed fee changes associated with the Agriculture, Assessor/Clerk-Recorder/Elections, Community Services, and Financial Services departments, and the Health & Human Services Agency. 
Strategic Plan Goal(s)
In Support of All Goals (Internal Departments Only)
Reason for Recommended Action/Background
The Board adopted the FY21-22 Master Fee resolution on June 29, 2021. Since that time, departments have identified the need for new fees and certain fee revisions. In total, 150 existing fees are proposed for revision, 42 new fees are proposed to be added to the Master Fee schedule, and 64 fees are proposed to be deleted. The sections below describe the proposed fee changes and rationale for each department. 

Agriculture
For decades the Yolo County Agriculture Department manufactured and sold rodenticides to help prevent destruction by squirrels, mice, rats and other rodents.  With no restrictions on who could use these products anyone who had a rodent problem, including single use homeowners, could purchase these baits to help protect their crops and property.  In 2013 the US-EPA added both Diphacinone and Zinc to the federal restricted pesticide list.  This had a trickle-down effect as the California Department of Food and Agriculture (CDFA) had to now make a label change making these materials “for ag use only.”  This label change now made it illegal to sell these products to the general public.  To purchase and apply these baits a person would be required to be permitted by the Agriculture Department, submit use reports and also obtain a Private Applicators License via testing through the Department of Pesticide Regulation.  As such,  the County could now only sell to licensed individuals.  Since this change went into effect the Agriculture Department has seen a substantial loss of sales and has determined that future manufacturing is no longer cost effective. 

The Agriculture Department ceased producing rodenticides in July 2019 and the remaining rodenticide inventory was sold in February 2020 resulting in no fiscal impact for this program. 

Assessor/Clerk-Recorder/Elections
The Clerk-Recorder’s office is proposing fee revisions to address several state mandated fees and operating costs. These fees are established in state code and are already being collected by the Clerk-Recorder. This action is updating the Master Fee schedule to align with changes in state law.
 
Four of the proposed fee revisions update the Master Fee schedule to align with filing fees dictated by the California Department of Fish and Wildlife (CDFW).  These new fee rates go into effect on January 1, 2022.
  • Environmental Document pursuant to a Certified Regulatory Program (CRP): $1,203.25 per document
  • Fish & Game - Environmental Impact Report on NOD: $3,539.25 per document
  • Fish & Game - Negative Declaration on NOD: $2,548 per document
  • Mitigated Negative Declaration (MND): $2,548 per document
The department is also proposing revised fees associated with Vital Records. Various Vital Records fees will increase pursuant to Assembly Bill (AB) 128 (Chapter 21, Statutes of 2021).  These fees go into effect on January 1, 2022, and include the following:
  • Copy of Birth Record: $29 per certified copy
  • Copy of Birth Record (govt entity): $22 per certified copy
  • Copy of Death Record (public & govt entity): $24 per certified copy
  • Copy of Marriage Record (govt entity): $12 per copy
  • Copy of Regular or Confidential Marriage record: $17 per certificate
  • Birth Certificate Search (govt agency): $22 each
  • Birth Certificate Search (public): $29 each
  • Death Certificate Search (public & govt agency): $24 each
  • Fetal Death Certificate & Fetal Death Search (public & govt agency): $21 each
  • Marriage Certificate & Marriage Certificate Search (govt agency): $12 each
  • Marriage Certificate & Marriage Certificate Search (public): $17 each
And finally, the Clerk-Recorder handles Vital Records that are technically initiated by the Public Health Department.  Those proposed changes will increase pursuant to Assembly Bill (AB) 128 (Chapter 21, Statutes of 2021) effective January 1, 2022 and are as follows:
  • Permit for Disposal of Human Remains-After Hour Issuance: $12 per permit
  • Permit for Disposal of Human Remains-Cross Filling: $17 per permit
  • Permit for Disposal of Human Remains-Regular: $12 per permit

Community Services
The Department of Community Services engaged Wohlford Consulting, a fee consultant, to conduct an objective analysis of the full costs incurred by the County in support of the Planning, Engineering and Cannabis services for which the County charges user fees (See Attachment D).  In order to ensure accuracy and establish a clear nexus between the cost of services and the fees, the study required a detailed analysis of time required for staff to provide each component of service delivery. The detailed unit cost analysis revealed a need to revise some fees higher to achieve full cost recovery; and in the case of the cannabis program, some fees need to be revised at a lower rate to comport to full cost recovery.

Some of the fees listed in the Summary of Proposed Fee Changes reflect various methodologies for implementing the fee increases using a stepped approach over several years. This is in consideration of fee payers so that they are not impacted by increases all at once. This is described in more detail by program area below:

Cannabis Unit
The detailed Cannabis unit cost analysis revealed a need to revise some existing fees higher and some fees lower to achieve full cost recovery without overcharging fee payers. Even though some fees will be increasing the net impact to all the existing cannabis cultivators will be a decrease in fees paid.  For example, a cultivator that grows one acre of cannabis year around will pay a total of $32,025 under the new fee schedule vs. $45,572 under the previous fee schedule.  The Cannabis Unit has been able to create many efficiencies in the program that has decreased the amount of staff time needed for each of the license types.  Some of these efficiencies are a result of the program becoming more streamlined and standardized as the program has aged.  Other efficiencies include moving from handwritten inspection reports to electronic inspection reports which greatly reduces the amount of time needed to write an inspection report and scanners for verifying the tags associated with the track and trace program.
 
The Cannabis Unit is also proposing new fees for the new license types allowed under the Cannabis Land Use Ordinance (CLUO).  New fees are also being proposed for the review of Cannabis Use Permits.  These fees are based on time estimates that staff provided based on the number of required inspections and their professional experience.
 
Planning
Both deposit and flat rate fees are currently far below the actual costs of service, requiring increases in all fees. There are generally two types of fees: deposit and flat rate. A multi-year fee increase plan is proposed, as described below

The deposit fees are increasing a maximum of 10% over a multi-year period. With deposit fees, applicants pay a deposit at the time of application and costs (including staff time and consultant costs) are charged against the depost based on actual cost. If the amount on deposit gets depleted the applicant will be asked to submit additional funds on deposit. Any remaining funds will be refunded to the applicant after project approval or when the project is withdrawn. As a result, there is no real change in the cost to applicants beyond the hourly rate increase (discussed further below). 

Flat rate fees are fees that apply a single fixed fee for a specific service. The Planning division’s actual costs of service are generally much higher than the current flat rate fees, necessitating an increase. However, the Yolo County procedure for Incremental Fee Increases which accompanies the County of Yolo Administrative Policies and Procedures Manual, Policy on Cost Recovery and Fees encourages a smoothing affect to make large fee increases over time so the fee payers are not unduly burdened. Therefore, staff proposes a 3-year stepped increase plan for most flat rates. While in some cases this approach results in a percentage increase that is quite high, the actual dollar amount of the increase is reasonable, in most cases less than $100.

In some cases, it has been determined that some fees that are currently charged as a flat rate would be better implemented as an hourly rate / deposit fee. Likewise, some fees were revised to represent a new fee structure or renaming. For example, “Lot line adjustment” was changed to “Lot line adjustment – up to 2 lots,” and “Lot line adjustment 3-4 lots” to take into account the additional time necessary when lot line adjustments involve more than 2 lots.

In addition, new staff hourly rates are proposed. These hourly rates, which take into account appropriate overhead costs, are the rates that will be charged for services including when applying costs to deposit fees. A new fee is also proposed, titled “Planning Application Fee” to be applied to deposit / actual rate fees. This is to recover the staff costs that accrue during the intake process, prior to a deposit fee being paid.

In a few cases, such as the ABC Permit categories, the existing fee is $159 with a unit of Per Hour (Minimum 5 hours). Staff feels that this fee structure is not transparent to the customer because at first glance, it appears the fee to the customer is $159. Therefore, these fee amounts were changed to the full fee amount.  Furthermore, ABC Permit (Beer, Wine) was combined with ABC Permit (Liquor) to create on new fee called “ABC Permit”, which is a deposit / actual hours permit.

Altogether, the department estimates that the proposed fee changes will result in an annual revenue increase in the Planning Division of $102,843 with the proposed fee increases for the first year.

Public Works
Public Works fee increases can be summarized in one of three ways which are explained in detail below:
  • A significant increase to the fee due to restructuring how the fee was applied
  • For large fee increases not associated with restructuring, a stepped approach over a 3-year period is proposed, and
  • Small increase to the fee based on actual cost increases, likely due to inflationary factors.
Several fee structures were analyzed and found that the fees being collected did not align well with the way in which the costs to administer them were accrued. For example, the County Surveyor’s Certificate of Compliance or Record of Survey take a substantial amount of review for the first sheet and significantly less for additional pages; therefore, staff has restructured the fee to have a much higher fee for the first sheet and a much-reduced fee for each additional sheet. This restructuring will continue to result in full cost recovery but apportions the fee more fairly across the permit applications (e.g., Existing Certificate of Compliance fee structure for 1-2 parcels is $90 and 3-4 parcels is $180; proposed structure is first parcel is $154 and each additional parcel is $30). There are a few new fees that are recommended to accommodate this transition in structure which are small and allow additional pages or sheets to be submitted in a permit package at a reduced cost, or to receive re-inspection or additional reviews of the same documents without resubmitting the entire permit.

The second type of fee that saw significant increases were development-related permits that were not obtaining full cost recovery. A review of each permit and the professional standard of care necessary for oversight showed that fees needed to be increased by way of a 3-year phasing plan as recommended in the County Incremental Fee Increase procedure. Staff briefly checked these fees against neighboring agencies for comparison and found no noteworthy irregularities.

The third type of permit fee increases are small increases of less than ten percent needed to achieve full cost recovery.  One exception to this is the fee for encroachment permits, which is proposed to increase by 10 percent but does not obtain full cost recovery, which staff feel is appropriate. The increased fees are comparable to other agency permit costs and help incentivize the public in obtaining a permit. These permits help County staff monitor the County right-of-way and which in turn reduces County liability.

The Planning and Public Works divisions notified customers of the proposed fee changes with email distribution lists to customers who have used our services over the last 18 months, and also posted printed copies at the front desk for potential customers to review.

Environmental Health Services Division

In 2019 the Environmental Health Services Division (EHD) engaged Wohlford Consulting to conduct an objective analysis of the full costs incurred by the County in support of the Consumer Protection, Hazardous Materials and Land Use services for which the County charges user fees. In order to ensure accuracy and establish a clear nexus between the cost of services and the fees, the study required a detailed analysis of time required for staff to provide each component of service delivery. The detailed unit cost analysis revealed a need to revise some fees higher to achieve full cost recovery.
 
At this time EHD is proposing changes to the Land Use and Hazardous Materials fees. The proposed fee increases were presented last year as part of a multi-year plan to increase EHD fees to support the full cost of the EHD programs. The EHD continues to experience increases in costs with each fiscal year, mainly due to an increase in employee costs such as Cost of Living Allowances (COLA), “Other Post-Employment Benefits” (OPEB) and insurance costs.  EHD estimates $68,220 in additional fee revenue should the proposed fee increases be approved. The revenue generated will be used to sustain minimal mandated services and reduce reliance on the County’s general fund. Reasonable efforts have been made to reduce or retain costs within the Division, including using special non-fee funds to purchase replacement vehicles.  Also, additional revenues have been secured with contract services and grants.

Notwithstanding, some of the Environmental Health programs remain underfunded because the current fees in those programs are less than the full cost of service. Because Yolo County is committed to creating an environment where businesses can succeed, smaller incremental increases in fees are favored over large increases when it is determined the fees are below the full cost of service. Therefore, where full cost was determined to be greater than 10% as compared to the current fee, the proposed fee was capped at 10% or $50 (if the fee increase is less than $50), which represents a reasonable incremental increase.  An exception to this is for Hazardous Materials fees for Farm Facilities. For these fees, the increase is 10% or $25 rather than $50 as these fees are very low. The Hazardous Materials fee is currently set up as a range based on certain categories and farm vs. non-farm facilities. The current and proposed fee amounts for Hazardous Materials are broken out by facility type and category in Attachment C. Although the current year’s budget will be balanced if the fees being requested are approved, it is important to note that in order to reach a point of full cost recovery, proposed fees that are still less than the full cost of service will require fee increases in the future.  For the current fiscal year, a combination of salary savings, prior year fund balance, available grant funds, a small amount of general fund and, where appropriate, use of fines and penalty funds are being used to offset the anticipated shortfall of revenue associated with not being able to cover the full cost recovery of fees.

Integrated Waste Management 

In an effort to fully recover the recycling costs of appliances brought into the Division of Integrated Waste Management (DIWM), the division is increasing the appliance recycling rates charged to customers.

On November 17, 2020 The Board approved a two-year phased approach on appliance recycling rates effective January of the following year. This coming year’s increase is the second year of the two-year phased appliance recycling rate increases. Effective January 1, 2022, General Household Appliances (Washers/Dryers, Trash Compactors, Microwaves, Dishwashers, Furnaces, Water Heaters, Ovens, Lawn Mowers and other similar appliance items) will go from $8 per item to $16 per item. Also, appliances containing Freon (AC Units, Refrigerators, Freezers, Water Coolers and other similar Freon containing items) will go from $12 per item to $25 per item. 

As stated in the November 17, 2020 Board Letter the Department of Integrated Waste Management (DIWM) continues to accept, process, and recycle over 12,000 appliances annually. Because of increased enforcement by the Department of Toxic Substances and Control (DTSC) on air quality regulations and hazardous waste storage limits, appliance recyclers will no longer pick-up appliances at the landfill without the units first being serviced (emptied of all hazardous waste such as Freon, batteries, circuit boards, capacitors, gear oil, etc.). This has resulted in a $125,000 annual increase in costs to the DIWM with no current means to recover these costs. The two-year increase in appliance recycling fees charged to customers is simply in response to increased costs incurred by the division and an effort to recover those costs.

Financial Services
The Department of Financial Services, Yolo County Collections Services (YCCS) division,  is proposing to eliminate several criminal justice administrative fees pursuant to Assembly Bill 177, which eliminates the authority of counties and superior courts to impose various administrative fees and/or fines effective January 1, 2022. Assembly Bill 177, which was approved by the State legislature and signed by the Governor in September 2021, builds upon the criminal justice fees that were previously eliminated by AB 1869 in July 2021.
 
While AB 177 eliminates 17 administrative fees, only three fees are currently included on Yolo County’s Master Fee schedule: a Restitution Collection fee, and two fees for the processing of Installment and Non-Installment Accounts Receivable.  These fees are not currently used as the Superior Court now handles restitution collection and the accounts receivable fees were levied on prior criminal justice fees, such as booking and work program, that were eliminated under AB 1869.
 
In addition, DFS is proposing to eliminate a fee for Processing Installment Payments, Adult Felony Charges Only. This fee was previously eliminated by AB 1869, but inadvertently missed when the AB 1869 fees were eliminated from the Master Fee schedule in December 2020.
 
Staff is continuing to research the balance that is owed for each of these fees and will return to the Board at a subsequent meeting for formal approval to discharge any outstanding debts, which will be rendered unenforceable and uncollectible by AB 177 and/or AB 1869.

Health & Human Services Agency
The Health & Human Services Agency (HHSA) is proposing to delete the Domestic Violence fee within the Social Services department. This fee was approved in January 2009 due to changes in state law that provided for an additional $250 fee upon fines and penalties collected by the courts for crimes of domestic violence. At the time, the Employment & Social Services Department wanted to use the funds collected through this fee to provide domestic violence intervention services. However, the fee was never implemented and HHSA does not currently provide domestic violence intervention services, rendering the fee moot.  
 
HHSA is also proposing to adjust the Emergency Medical Services (EMS) Air-Ambulance Annual Permit fee from $2,000 to $5,000 to align with current Air Ambulance contract rates being charged by EMS. As such, this adjustment is simply aligning the Master Fee schedule with what is currently being charged, and does not reflect an actual increase in the current rates. 
Collaborations (including Board advisory groups and external partner agencies)
Proposed fee changes were developed and submitted by the requesting departments. Fees were reviewed by the Department of Financial Services and County Counsel. County Counsel has reviewed the Master Fee Resolution as to form.
Competitive Bid Process
N/A

Fiscal Impact
Potential fiscal impact (see notes in explanation section below)
Fiscal Impact (Expenditure)
Total cost of recommended action:    $   0
Amount budgeted for expenditure:    $   0
Additional expenditure authority needed:    $   0
One-time commitment     Yes
Source of Funds for this Expenditure
Explanation (Expenditure and/or Revenue)
Further explanation as needed:
The proposed changes to the Master Fee Schedule are estimated to generate additional revenue of approximately $353,056 annually, as reflected in the table below: 
 
Estimated Annual Revenue Impact
Sanitation Fund        186,368
General Fund        163,275
Cannabis Cultivation Fund         (91,071)
Environmental Health Fund           68,220
Roads/Public Works Fund           26,264
Total        353,056



 
Attachments
Att. A. 2021-22 Master Fee Resolution
Att. B. Proposed Fee Changes
Att. C. HazMat fees
Att. D. Community Services Fee Study
Att. E. Presentation

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Form Review
Inbox Reviewed By Date
Financial Services Melissa Patterson 12/01/2021 10:55 AM
County Counsel Phil Pogledich 12/01/2021 11:19 AM
Joanne Van Hoosear Joanne Van Hoosear 12/01/2021 04:18 PM
Joanne Van Hoosear Joanne Van Hoosear 12/02/2021 07:38 AM
Form Started By: Shelby Milliren Started On: 11/03/2021 09:15 AM
Final Approval Date: 12/02/2021

    

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