Consultant report: if we stopped subsidizing new development, we could get a whole ‘nother cop!

14 Nov

Next Wednesday the city has scheduled two concurrent meetings – a Finance Committee workshop starting at 8:30 am and an Internal Affairs Commission meeting starting at 9am.

http://www.ci.chico.ca.us/document_library/minutes_agendas/finance_committee/11-18-15FinanceCommitteeAgendaPacket.pdf

http://www.ci.chico.ca.us/document_library/minutes_agendas/internal_affairs_committee/11-18-15IACAgendaPacket.pdf

You might recall councilwoman Tami Ritter changed the time of the IA meeting from 8am to 9am because she can’t get her big ass out of bed, through the shower and coffee shop drive-thru before 8:45 am. 

Both of these meetings hold items of interest to me. I question their scheduling these meetings concurrently but where’s that going to get me?  At the Finance Committee workshop they will discuss how developers have been getting away without paying fees for years, putting the Development Fund as much as  $9 million in the red for years. I had to print that figure in red, I mean, $9 million dollar deficit? How does that happen? 

Well, it happens when you don’t collect the fees, but you continue to pay city employees to do work for developers. There’s a whole department full of salaries up in that building devoted to for-profit developers. 

This problem was highlighted about 10 years ago when Cal Trans threatened a lawsuit against the city for not “dedicating” funds for widening of Hwy’s 99 and 32 while they permitted subdivisions all over town that were obviously going to strain our roadways. Tom Lando, then city manager, argued that the state should  pay for the widening, but Cal Trans showed without effort that the strain was coming from five specific subdivisions the city had approved, including Meriam Park – “a city within a city…”

I sat in a meeting where former city employees told us  these “planned communities,” like Westside Green over on Nord, were going to take the quality of life in our town on a one way ride. At that time most of our major roads had an ‘A’ or ‘B’ rating for travelability,   $taff said they were moving quickly toward ‘C’ and would never return. 

Ultimately Chico was ordered to dedicate funds, but in a conversation I had with Mark Sorensen about a year ago, he said the city had never collected the funds from any of the developers named in the suit. It looks like they still haven’t. Read the report I cut-and-paste from the agenda:

Specific Fee Category Results.   The analysis revealed that 70% (412 I 590) of the current fees for New Construction (a count of plan check and inspection fees combined) are less than the full cost of providing the services, thus providing a subsidy to fee payers. The remaining fees (30 %) are currently set equal to or higher than full cost. In other words, if the City elects to set all fees to recover full cost (and no more), some of the current fees would increase, and others would be reduced.

Read on – “new construction” means new homes and commercial buildings – 70 % of building activity going without paying fees!  “The remaining fees” are homeowners doing remodels, etc to their existing homes – we’ve been paying fees “set equal to or higher than full cost…”  It says there, “some of the current fees would increase, and others would be reduced.”  

Well, let me add a suggestion – they ought to have to give us our fucking money back, homeowners have been ripped off to pay for the big boys.

Read on:

Overall, since the annual volume of new construction permit activity applies more heavily to those fees that are currently under-charged (subsidized), the City would experience an overall increase in annual revenue in New Construction fees of approximately $ 260,000. A pattern of over- and under-charging for individual fees is very common for building studies. Wohlford Consulting normally finds that New Construction fees under-recover the cost of services for smaller project sizes and over-recover for larger project sizesparticularly at the extremes of the range. The existence of an overall deficit or surplus in New Construction fees depends on the mix of projects among sizes, but it most commonly results in an overall deficit or potential increase in revenues if fees are set at full cost for all project types and sizes. This latter result is evident in the Chico Building analysis. The results for the Miscellaneous Commercial fee category also show a mix of subsidized and surplus fees, but the overall revenue result is different. Although a large majority of fees by tally (71% or 132/185) are currently under-charged and subsidized, enough volume of activity occurs in the over-charged fees that the net result is an annual surplus of $48,000 and a cost-recovery rate of 114%. In particular, overcharges in the group of fees for small remodels or renovations (Fees# 12-17 in the Building results) offset all of the subsidized fees in the Miscellaneous Commercial fee category. In other words, the fees for small remodels and renovations are partially funding a variety of other fee services. As a result, if the City sets fees at 100% of full cost in this category, some fees would increase and others would decrease, but the net revenue would decrease by approximately $48,000 per year. A slight majority (53% or 45/85) of fees in the Miscellaneous Residential fee categories are currently set at or above full cost. The annual fee activity volumes for those categories result in a net surplus of $ 44,000 and a cost-recovery rate of 131% when compared to full-cost-recovery fee levels. Even though two of the three general Building fee categories present a revenue surplus, the funding deficit in New Construction is large enough that the net effect of all of the categories combined (New Construction, Miscellaneous Commercial, and Miscellaneous Residential) is an overall subsidy of $169,000. This subsidy also represents a potential annual revenue increase of $169,000 if the City sets fees at the full-cost-recovery levels. 

And let me remind you, Franklin Paving, one of the “big boys”, was probably the biggest single contributor to Mark Sorensen’s recent campaign. Look at the reports for Mike Maloney’s PAC, I ain’t got time to school you again on that.

Meanwhile, in the room next door, the Internal Affairs committee will be discussing an ordinance written almost specifically for the protection of our adorable City Clerk, Badge Bunny, and Best Pinner Ever!, Debbie Presson – a new Code of Conduct Policy that does not allow council members to go to the public with their concerns about staff. 

So there you are, I know you can’t make it. I’ll keep you posted.

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7 Responses to “Consultant report: if we stopped subsidizing new development, we could get a whole ‘nother cop!”

  1. Jim November 14, 2015 at 9:35 am #

    For what they want to spend to hire an airport manager (who will spend most of his day sleeping in his office) they could also hire another police officer.

    If the developers arn’t paying, maybe I should just stop paying my property tax too…. We’ll will see how that works out.

    • Juanita Sumner November 14, 2015 at 10:26 am #

      You know, I’m actually proud to pay property taxes – I pay my share for stuff I want to have. You’re not a leech either, you contribute a lot to the community besides your prop taxes. You’re one of my only friends I ever see at the stupid meetings, thanks for that.

      The developers have not been paying their share. But the city is also somewhat to blame – remember when those local developers successfully sued the city for return of fees they’d been made to pay that had not been spent on infrastructure? They got $500,000 back from the city. I don’t know how to feel about that. On the one hand I was glad to see somebody stand up to the city, they were playing shells and peas with our money, not using it for what it had been dedicated (like road widenings!). Unfortunately, I don’t think the developers put in the infrastructure either – sidewalks, drainage, etc – so we were the real losers.

      I wish I could afford a lawyer, I’d sue the city for fees we’ve overpaid for replacing roofs, etc. They been screwing the little people, especially the small landlords.

  2. bob November 14, 2015 at 9:27 pm #

    All these new developments…who the hell is going to live in them??? All low income folks? They’re building a huge new complex out by the new court house and it’s all low income. And there’s a lot of low income housing out in that area already.

    I guess all this new development must be for low income or retired folks. Who the hell else is going to move here? There are no good jobs and the cost of living in this town is high.

    The developers will pass most of these costs on to the buyers which for the low income developments mean the taxpayers.

    • Juanita Sumner November 15, 2015 at 5:57 am #

      They say they have to build low-income – that’s not true, they just do it for grants to pay off the pension liability. Then they bring people here to live in them, just like the Behavioral Health department brings in “mentally ill” people.

      A friend of mine has a low-income complex across the street from his house in Chapmantown – they keep bringing Bay Area families to live there for some reason.

      Another friend of mine has a business near a similar complex in Magalia, of all places. He says they also bring a lot of families from the Bay Area. They come into his store and drop their life story on him when they are asking for bus change.

      All to pay salaries and benefits and pension deficit. And yeah, the taxpayers pay the lion’s share.

      • Jim November 16, 2015 at 8:16 pm #

        You know, I was in WinCo the other day, I noticed a lot of urban low life types shopping there. You can tell by the style of clothes they aren’t from around here and certainly didn’t go to college here.

        I was wondering how these folks made their way to Chico? Now you’ve answered my question.

        That makes a lot of things clear, such as why the police are overburdened, same with the hospital emergency room. While the civic leaders talk nonsense about ‘strategic growth’ what they are really doing is importing these folks to fill low income housing.

      • Juanita Sumner November 17, 2015 at 7:33 am #

        “what they are really doing is importing these folks to fill low income housing.”

        Yeah, they’re bringing in their own herd of cash cows.

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