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HomeMy WebLinkAbout1983-05-03; City Council; 7343-1; Improvement Plan Review Fee changesGIT JF CARLSBAD — AGEND, 3ILL AR« 7343-1 MTG. 5-3-83 nPPT ENG TITLE: REVISION TO CITY CODE TO INCREASE THE IMPROVEMENT PLAN REVIEW FEE DEPT. HD-f?^^- CITY ATTYVF^> CITY MGRo %&* QLU ooro_a. O oo RECOMMENDED ACTION: Adopt Ordinance No. 9681 increasing the improvement plan review fee. ITEM EXPLANATION: At its meeting of April 12, 1983, the City Council introduced Ordinance No. 9681; however, a public hearing must be held prior to adopting the ordinance.. The current fee is 1% of the value of the improvements. Improvements include all street work (paving, sidewalk, street lights, etc.), storm drain systems and water and sewer systems. The proposed fee is on a sliding scale as follows: ESTIMATED COST OF IMPROVEMENTS FEE $ 0 to 20,000 to 50,000 to 100,000 to 250,000 to 500,000 to $ 20,000 50,000 100,000 250,000 500,000 1,000,000 Over $1,000,000 3. 2. 2. 1. 1. 1. 0% 5% 0% 75% 5% 25% ($ ( ( ( ( ( 1, 2, 4, 7, 200 600 250 000 375 500 minimum) minimum) minimum) minimum) minimum) minimum) 1.0% ( 12,500 minimum) Improvement Cost $ 356,000 $2,614,000 Existing Fee $ 3,560 $26,140 Proposed Fee $ 5,340 $26,140 Two examples of actual projects processed last year will indicate how fees will change: Project Oak Communications Carlsbad Research Center The first project consisted of street widening along the frontage. The proposed fee increase would be $1,780. The second project is a 100 acre portion of an industrial park. There would be no fee increase for this project. There are two reasons to increase the fees. First there are certain fixed amounts of work that do not depend on the size of the project such as logging the project, pickup and delivery of plans, preparing bonds and agreements, comparing the improvement plans with the final map. Secondly, the consultant planchecker, recognizing these fixed handling costs, requires a proportionally higher fee for small projects. FISCAL IMPACT: All the costs involved will be borne by the developer. The fee increase gives the City the flexibility to use a consultant planchecker or do the work in- house with the assurance that there will be no cost to the City and a quick plan check time for the developer. EXHIBIT: 1. Memo to City Manager from City Engineer: Cost Analysis 2. Ordinance No.9681 approving an increase in the improvement plan review fee. APRIL 29, 1983 TO: CITY MANAGER FROM: City Engineer IMPROVED PLAN REVIEW FEE - COST ANALYSIS During the period July 1, 1982 to March 1, 1983, the City collected $29,000 in improvement plan check fees. Based upon a fee of 1% of estimated con- struction cost, this represented $2.9 million in constructed value at an average of about $300,000 per project. The cost to the City in terms of direct labor is about $30,000 based upon an estimate of sixty manhours per week over a period of about 32 weeks. The actual value of this time would be more than $30,000 taking into account general City overhead required to support this activity and the lost time of staff standby time. Therefore, the fees collected were not equal to the cost of the services. It is now proposed to use contract labor to provide this service, thereby allowing the staff members previously used to be assigned other work so as to avoid increasing the size of staff. Whether or not contract labor would be used to do this work, it should be noted the fee structure was inadequate to pay the cost of the services rendered and should therefore be adjusted. The City requested proposals for plan checking services from eight firms and received five proposals. Willdan Associates and Berryman & Stephenson, Inc. were rated best based on qualifications and Willdan was selected, in part, because Berryman & Stephenson's proposal fee was high. Both companies pro- posed a fee based on a percentage of improvement construction cost as follows. Estimate of Cost Willdan Fee B&S Fee $ 0 - $ 20,000 2.25% 2.80% 20,000 - 50,000 1.88% 2.10% 50,000 - 100,000 1.50% 2.10% 100,000 - 250,000 1.31% 1.60% 250,000 - 500,000 1.13% 1.60% 500,000 - 1,000,000 .94% 1.60% over - 1,000,000 .75% .80% Two basic methods of computing the fee were considered: One, as a percentage of the value of the improvements or, two as an hourly rate times the number of hours worked by the consultant to check the plans. The hourly rate system required detailed recordkeeping of all hours spent and would not provide incentive on the part of the consultant to complete the checking quickly. Also, the actual cost could not be determined in advance which would deter the developer in effectively budgeting his project. Page -2- IMPROVED PLAN REVIEW FEE - COST ANALYSIS APRIL 29, 1983 The percentage fee method is based upon reasonable estimates of the actual construction cost, and provides a uniform basis to collect the fees and pay the consultant. An example of the impact of the fee increase using a $300,000 project is provided as follows: a. Previous fee schedule - $300,000 x 1% = $3,000.00 b. Proposed fee schedule - $300,000 x 1.5% = $4,500.00 The consultant would be paid $3375.00 for the service and the City would retain $1125.00 to offset expenses of processing the plans for checking and the followup required in dealing with the developer. This is considered to be an economical procedure without undue stress on the use of general funds to support this activity. ROY LMCffCKtEY, JR. RLK:mmt 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 28 ORDINANCE NO. 9681 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, AMENDING TITLE. 20, CHAPTER 20.08 OF THE CARLSBAD MUNICIPAL CODE BY THE AMENDMENT OF SECTION 20.08.050 TO REVISE THE IMPROVEMENT PLAN REVIEW FEE The City Council of the City of Carlsbad, California, does ordain as follows: ' SECTION 1: That Title 20, Chapter 20.08 of the Carlsbad Municipal code is amended by the amendment 'of Section 20.08.050 to read as follows: "20.08.050 Improvement plan review and construction inspection fees.All construction and installation of improvements shall be subject to plan review and inspection by the City Engineer or other appropriate department, and the subdivider shall arrange for inspection prior to starting construction or installation of the improvements. The costs to the City in examining improvement plans, inspecting improvements and monuments shall be paid by the subdivider. An improvement plan review fee based on the approved engineer's estimate of the total improvement costs, shall be paid to the engineering department upon submittal of improvement plans for review as follows: ESTIMATED COST OF IMPROVEMENTS FEE 0 to ?20,000 20,000 to 50,000 50,000 to 100,000 100,000 to 250,000 250,000 to 500,000 500,000 to 1,000,000 Over 1 ,000,000 3.0% ($200 minimum) 2.5% (600 minimum) 2.0% (1,250 minimum) 1.75% (2,000 minimum) 1.5% (4,375 minimum) 1.25% (7,500 minimum) 1.0% (12,500 minimum) An improvement construction inspection fee of two percent of the approved engineer's estimate of the total improvement costs shall be paid prior to approval of the final map or the commencement of construction of the improvements, whichever occurs first." EFFECTIVE DATE: This ordinance shall be effective thirty days after its adoption, and the City Clerk shall certify to the adoption of this ordinance and cause it to be published at least once in the Carlsbad Journal fifteen days after its adoption. INTRODUCED AND FIRST READ at a regular meeting of the Carlsbad City Council held the 12th day of April 1983. PASSED AND ADOPTED at a regular meeting of said City Council held the 3rd day of May , 1983, by the following vote, to wit: AYES: Council Msiribers Casler, Lewis, Kulchin, Chick and Prescott NOE'S: None ABSENT: None 8 9 10 MARY H. CALLER, Mayor 12 ATTEST: 14 15 __ ALETHA L. RAUTENKRANZ, City Clerk 17 (Seal) 18 19 20 21 22 23 24 25 26 27 28