Torrance Considers Plan to Raise User Fees by 72%

The Torrance City Council will begin considering later this month a recommendation to increase by 72%, or almost $2 million a year, the fees charged to residents for many city services.

The increases would be phased in over a three-year period beginning July 1, city officials said. Anyone who pays a user fee for a city service could expect to pay more, though the increase would vary among the 109 user fees, they said.

The council will discuss the increases for three consecutive weeks, beginning with the Feb. 21 council meeting.

“I don’t think any of the fees will be devastating in nature,” said City Manager LeRoy Jackson. “They will be spread out over many departments.”

User fees are charged for services that benefit individuals rather than the general public, such as adult education classes and building inspections. The fees are paid as the service is used.

Under state law, a city may set user fees to pay for up to 100% of the cost of a service. Unlike taxes, user fees may be raised without a vote of the public.

The recommendation to increase the fees by $1,911,453 came in financial report released last month.

David M. Griffith and Associates Ltd., a Sacramento-based consulting firm that specializes in revenue enhancement for state and local governments, studied user fees in Torrance and found that the city subsidizes about 70% of the cost of the services. If the fees are increased, the report said, the subsidy would be reduced to 49%.

In dollars, the report said, the full cost of user-fee services in Torrance in 1988 was $8,882,804. The fees collected $2,649,522, leaving the city to pay $6,233,282. With the suggested increases, the city would have to pay only $4,321,830.

Jackson said the report, the city’s first in-depth analysis of user-fee services, shows that “we are subsidizing for costs that should be paid for (by the fees).”

Mayor Katy Geissert said Jackson suggested the study during 1988’s mid-year budget review. The city is not in financial hardship, she said, but has been hit recently by unexpected expenses.

These include putting aside $500,000 for safety studies and a potential legal battle with the troubled Mobil Oil refinery, Geissert said, as well as repairs after a mudslide at Via Corona and Vista Largo that are expected to cost about $5.2 million.

The City Council will consider the report’s recommendations in three sections, one at each council meeting, said Finance Director Mary Giordano. She said the city Finance Department is recommending that the council approve all the suggested fee increases.

The report suggests that the city raise fees to cover all its costs for building permits, Engineering Department inspections and some police services, such as response to false alarms.

Overall fees for Recreation Department services would be increased 29%. Fees would also be raised for fire inspections, grading, airport noise violations, impounded cars and minor permits.

Jackson said the city will try not to make services too costly for some residents.

Geissert agreed: “It would defeat the purpose of providing services as a public entity if we make them too expensive for people to afford.”

She said the council does not want to impose fees where no current fees exists and has reservations about increasing recreational fees.

According to the report, the city needs to increase user fees because spending-limit laws such as Proposition 13 require cities to function more efficiently.

“The basic thrust of recent constitutional amendments concerning state and local government financing was to force a recognition of the tolerance level of the California citizenry to unchecked spending,” the report said. “The message for governments is to operate in a business-like fashion; i.e., price services properly such that the city lives within its budget.”

The consulting firm, which took five months to complete the report, compared Torrance’s user fees by computer with fees in other Southern California cities of similar size.

FINANCING USER-FEE SERVICES IN TORRANCE

CURRENT Revenue from fees City subsidies Total cost $2.65 million $6.23 million $8.88 million PROPOSED $4.56 million $4.32 million $8.8 million

City savings: $1.9 million