Vista, full service city located in San Diego County, California, had not conducted a study of their fees since 2002. This simple fact was bringing about question as to the validity of its valuation-based fee structure. In addition, the City suspected the factors it was using to determine construction valuation were low and it recognized that many recent State requirements such as Green Building and ADA requirements were resulting in additional processing costs that were not reflected in their existing fee structure. The City wanted to accurately report the true costs of providing building inspection and plan check services, and adjust its fees to reflect these costs.
MGT’s analysis was guided by several requested services to:
- Research and recommend a legally defensible, user-friendly fee structure.
- Calculate the fully burdened cost of providing building inspection and plan check services.
- Ensure all proposed fees comply with Proposition 218, California Attorney General opinions, and the 2007 California Building Code.
- Recommend a method of annually adjusting fee levels.
- Forecast potential revenue impacts of the revised fee schedule.
MGT’s methodology included:
- Apply fully burdened labor rates to time requirement estimates and annual workload figures and ensure drive time and issue resolution efforts are included.
- Incorporate a fair share of front counter costs into fees.
- Benchmark existing and proposed fees against those charged by other cities in San Diego County.
MGT recommended increasing low valuation fees while reducing several high valuation categories. As a result of this action Vista’s valuation fee structure now reflects actual processing costs. All valuation data were updated to match the new International Code Council (ICC) categories. Additionally, several changes were recommended to make the fee schedule more user-friendly, including institution of several flat fees (residential reroofs, pools, etc.) and collapsing four construction types into one. The new fee schedule is fully defensible and resulted in a 39 percent annual revenue increase.