Recommendation to conduct a study session to receive and file a presentation on the results of the user fees and cost recovery studies for the Development Services, Health and Human Services, and Parks, Recreation and Marine Departments and associated departmental recommendations.
Madam Clerk, if you can please read the the study session item, and then I'll turn to. Recommendation to conduct a study session to receive and file a presentation on the results of the user fees and cost recovery studies. Thank you, Mr. Mayor. Members of the City Council. So we have a presentation to give to you tonight on a strategic objective of a council's that's been underway for a couple of years now. This started back with the Budget Oversight Committee making a recommendation to the council to really focus and bring some attention to how we set our fees, doing some real analysis through outside experts to help us understand at what level should we be doing cost recovery? How do we determine cost recovery? And then where are the areas that we want to essentially subsidize? Because we want to make sure that our community has access to our services at a at a price that is affordable or at no cost at all. And so we are bringing you this as kind of an action item study session. And you're actually not taking action tonight. No fees are going to be approved tonight. This is more of a policy discussion. And then we'll be bringing you some of the first round of of the recommended fees on May 18th for you to consider. So I will turn it over to Grayson and Jody and Alejo, who will walk us through our presentation and the complex analysis that's been conducted. Great. Thank you very much, Tom. Good evening, Mayor and members of the city council. This agenda item, as Tom said, is to present to you an overview of the citywide fee study that has been completed for three departments, Health Parks and Development Services, and also present the department's recommendations on any changes to fees as a result of the study. Today's item is a presentation of the study and departmental recommendations that was previously transmitted and received by City Council on April six and similar to April six. As Tom mentioned, there are no actual fees changes being proposed tonight. The purpose of today's presentation is to provide City Council with an overview and an opportunity to make comments. The actual hearing to change fees as recommended by departments as well as other midyear fee changes is scheduled for May 18th. If the City Council has any changes to staff recommendations on fee changes, those can be made on the floor on the May 18th fee hearing. Geraldine Alejo, our revenue officer, will first provide a general background on fees as well as a background and overview of the citywide fees study. Then we will be turning the presentation over to Health Parks and Development Services, who will each go over the highlights of the study for their respective departments and their recommended fee changes? We will be available for questions at the end of all of the presentations. Before I turn it over, I do want to comment that this study and review has required a great deal of work analysis and time on the part of the departments. And Geraldine and I just want to appreciate them for their work towards this effort. And with that, I will turn it over to Geraldine. Thank you, Grace. Good evening, Mayor, and members of the City Council. I will first start with a brief overview of fees and charges. Fees and charges include two types of categories user fees and regulatory fees, both of which are included in the city wide master fees and charges schedule. User fees are charged for the use of a public service program such as recreation programs. Regulatory fees are charged to pay for the costs of a government program which regulates fee payer activity or use to mitigate the impact of the payers activity, such as building permits or pet licenses. Rents and penalties are also included in the master fees and charges schedule for convenience, but are not subject to the cost of service limitations. Rents include facility rentals and off street parking. Penalties include parking citations or late payment fees. Next slide. I you. User fees and regulatory fees may not exceed the estimated reasonable costs of providing the service or program. City policy requires that fees are set at the cost of service, except where there is a greater public benefit using a lower fee. This is important to point out because in many instances the city actively sets fees lower than the cost of service to achieve other goals, including maintaining access to public programs and seeing competitive comparable jurisdictions or market rates. Some of these goals and dynamics will be highlighted as part of the department presentations and their fee change recommendations. The city currently has routine processes in place to ensure that fees are reviewed and updated regularly to capture annual cost increases. The city implements an annual inflation adjustment based on city cost increases called the City Costs Index, or CCI. The master fees and charges schedule is adopted each year with the budget with any proposed changes by the departments as well as any CCI updates applied to the fees. Mid-Year adjustments are also periodically submitted to City Council, either as a coordinated citywide effort managed by the Budget Office or on an as needed basis by individual departments. The next city wide fee adjustment letter will be presented to City Council on May 18th. Each fee adjustments council letter includes an estimated revenue impact from a proposed fee change. The revenue impacts are theoretical and may not necessarily result in a budgeted revenue change by the same amount. Any adjustments to actual budgeted revenues must be evaluated holistically and consider a variety of factors such as the stability and certainty of the revenue source, as well as whether the department is meeting its current overall budgeted revenue commitments. This review and update is typically part of the overall budget development process. Now I'd like to provide an overview of the Citywide Field Study Project. As a reminder, in fiscal year 19 and at City Council's direction, staff initiated an updated citywide study. This will be a multi-year project where all city fees will be evaluated, with some exceptions, such as the cases where separate rate studies are in progress or rates are set by external agencies. Each department study will identify and review the fees charged, calculate the full service costs with indirect and direct costs. Determine subvention rates by comparing fee revenue to the full cost of service and provide recommendations for fee levels or structures. The project continues to move forward on a rolling department basis and is anticipated to conclude in 2022. The first round is complete and covered development services, parks, parks, recreation, Marine, as well as a portion of Health and Human Services. Each of the round one departments will be presenting study findings and the recommendations later in this presentation. The second round started in November with energy resources, public works and police departments. Pull in. Preliminary results are anticipated for these departments this summer. A consultant applied a consistent methodology across all department studies, which started with identifying service centers and fees and reviewing cost components. Cost components are based on the FY 20 budget and include direct costs, salaries, benefits and operating expenses as well as indirect costs, which includes departmental overheads such as administration and citywide indirect costs based on the city's indirect costs plan, the cost components are then included in a fully burdened hourly rate per position. The allocated cost is determined by multiplying the fully burdened hourly rate to the staff. Time spent to support a service after the fully allocated service cost is determined. It is compared to the current fee revenues to identify the subvention rate by service. This table is a summary of the costs, recovery and subvention rates per department and shows that the city is generally under recovering for calculated service cost. More information will be included as part of the department presentations with costs and subvention rates reported at the General Service categories or areas. The departments have reviewed the results of the studies and have recommendations on any changes they are proposing to make. The majority of department recommendations align with the study recommendations on full cost recovery, but deviate in some cases based on prioritizing different goals other than full cost recovery, as I noted earlier. These various factors will be noted as part of each department presentation. The departments will share more information on the recommendations. But to summarize here, the first table is a summary of the department's FY 21 midyear recommendations. Of the 1147 individual fees reviewed by the consultant, 470 remained unchanged. 276 or increase 190 were decrease. 188 were restructured. And finally, there were 23 deleted fees. The fees reported here are proposed clean ups to the department. Fee schedule for services are no longer provided by the city. The estimated theoretical annual revenue impact from the department recommendations is 2,013,978 and spans across various funds. Again, budget and actual revenues will be reviewed during the budget process and will vary based on usage and market or economic conditions. Although departments will be presenting an overview of study findings and propose recommendations, no changes to the master fees and charges schedule are requested tonight during this study session. Proposed changes to the master fees and charges will be brought to City Council for approval on May 18th. The proposed changes on May 18th will include the department recommendations discussed today, as well as other midyear fee changes typically proposed by departments as part of the midyear fee change process. Regarding fee changes from the city wide fee study, there have been no changes to the recommendations since they were first received by City Council on April six. After May 18th, the next citywide fee adjustment process will be part of the FY22 budget adoption process. This concludes the overview. I will now turn it over to Health and Human Services. Pamela Bright for an overview of study findings and the Department recommendations for fiscal year 21. Thank you very much. Good evening, Mayor, Vice Mayor and City Council Members. Physician Services. Preliminary results are as such. The vendor reviewed 77 fees within a physician's services bureau. Next slide, please. Within a physician services bureau. They reviewed service categories in the following areas vital records, travel, immunization, laboratory services. As a result, the study found that the department is at a 46% cost recovery rate and a 54% subvention rate. PS. An Environmental Health Bureau will be reviewed in a later phase, tentatively scheduled for later this month. Next slide, please. The bottom of the screen represents the total, which is a combined total for each respective service category, which those service categories are in column one. In Column two. That is the combined actual cost to render the services, which is the 1.1 million. Column three. That $508,603 is the amount collected for the services rendered. The total profit or subvention is a 594,866, which represents a 46% cost recovery and a 54% subvention rate. Next slide, please. While determining whether or not to accept the fee study, we had to consider many factors. Enhancing access to public health services. Essentially the overall public benefit. Comparisons to neighboring jurisdictions. Medicare. Medical fees for clinical services. Or clinical fees. Regulatory requirements for laboratory fees. With this in mind. Out of the 77 fees reviewed at this time, we are not requesting any changes. Next slide, please. Next slide, please. Okay. I'm sorry. Okay. So this particular slide. Is the key items to consider. So for today's presentation, we really wanted to focus on vital records and vital records. We wanted to look at the full cost for recovery. When we did a comparison to other jurisdictions, what we noticed was what we were able to information we were able to get back was that the expedited copy of birth certificate fee would be 113% higher than L.A. County. The studies propose letters for non contagious disease b would be 450% higher in L.A. and Riverside counties. The study's proposed emergency weekend death fee. Death certificate fee would be 280% higher in Berkeley. Next slide, please. So overall, increasing these fees or increasing these vital records fees to recover the full cost of providing these services would inhibit or hinder access to these public services due to all preceding factors, as well as detrimental impacts of COVID 19 pandemic. The Health Department is not proposing any changes at this time. The Department will review the study recommendations for physician services fees and may move forward with proposed fee increases as part of the fiscal year two fiscal year 22 budget process. However, there's a high probability that we will not recommend any fee increases. I know there was one flight that was missed and that flight talked about some of the reasons why. We do not want to increase the fees. And those were okay. And. City services reform, I think is further up. Further back. But essentially, when we looked at all day, we compared it to other jurisdictions. We looked at Medicare, medical fees, studies, office schedules. We also took into consideration that the benefit to public. So that's why at this particular moment in time we are not making any recommendations to increase anything is. Not sure if there are any questions. I have a. Question. Sure. But I don't know if we're saving them till the end. I could. Okay. So I'm going to turn it over to Parks Recreation and the Marine Department. Thank you very much. Honorable Mayor and members of City Council. My name Brant Dennis and I serve you in this community as a director of Parks, Recreation and Marine. This evening I present to you an overview of our department's cost of services study and a summary of recommendations. I'd like to point out another major area that our department supports is Animal Care Services. The department is appreciative. Of the opportunity to complete the cost of services, study fee revenue and its impact to the department's ability to provide programs and services is important to PRM. We take our responsibility seriously to establish fees that are fair and equitable, to provide affordable and diversified services to all individuals. Next slide, please. The department has over 800 fees spanning multiple funds during this round of the study. 654 current fees were evaluated. The remaining fees, not including in the study, are regularly reviewed through other established mechanisms. The study discusses changes to current rates and possible new fees pursuant to the City Charter. The Parks and Recreation Commission has authority over recreational programs and facilities, which includes the approval of related fees. Fees within the Commission's authority that were approved at their meeting in January will be presented today as they were part of the study. It's important to note that full cost recovery is not always recommended in order to encourage access to important recreational opportunities. Next slide, please. Here you will see a summary of subvention rates by service area. The columns represent service costs. Fee revenue at the current rate and the total profit or subvention. This chart includes all group funds. This chart does not include revenue unrelated to fee charges and doesn't represent fees that were excluded from the study, such as golf and marine slip fees. At the current level of fee and fee revenue represented here, the department is achieving a 13% cost recovery rate overall. Next slide, please. At the conclusion of the Study Department recommendations include changes, including both rate increases and decreases to meet cost recovery and operational needs, as well as changes in fee structures to align with service provision. The total estimated annual revenue impact from the recommended changes is approximately $514,000 in general fund and over $60,000 in the Tidelands operating fund groups. Next slide, please. During the course of the study, it's important to consider the impact of prime services and programs to the community as part of the compassion sales policy. Animal Care Services rate changes are recommended to encourage the best outcome for treatable animals. Implementing changes in fee titles to clearly identify services is recommended for consistency and to align with our service offerings. Market based fees such as rent, space and equipment are set by what the market can bear and public demand. Cost recovery is often calculated at an aggregate level of cost center, which considers the costs of a group instead of individual fees. Next slide, please. Of the total fees included in the study. PRM proposes that 340 remain unchanged. 20 fees are proposed to decrease. 162 are proposed to increase. 109 are restructured fees and 23 fees have been deleted. Recommendations in the study for new fees that are not proposed as part of the fiscal year. 21 midyear recommendations will be brought to City Council at a later date. Next slide, please. Examples of recommended adjustments are decrease fees for animal in pounds, increase fees for field use permits and facility rentals, and new fee structures for artificial turf fields just to name a few. Rates set below cost recovery are charges for staff time, animal impound and medical services and the youth sports program. Keeping these fees below costs recovery removes barriers to access programs and services. Next slide, please. Comparisons to other jurisdictions and agencies can be difficult because other agencies have different fee structures and fee types then prime such as sports field use and facility rentals. Animal licensing fees are in the higher range when compared to other agencies. Marine Bureau rates maintain a competitive price point when compared to similar marine agencies, helping to ensure a financially sound enterprise while remaining in competitive balance with marine industry price trends. Finally, I want to thank financial management and the consultants for their leadership. These are important to our city and the department finances and help us provide critical programs and services that our community needs. This concludes my presentation, and then I'll turn it over to the Department of Development Services Director Oscar Orsi. Thank you, Mayor, and members of the city council. Next slide, please. Unlike the other departments that you've heard from tonight, the development services is funded largely from the Development Services Fund rather than the general fund. And it is funded through the collection of fees for services that include entitlements, client checks and inspections. The consultant helped us analyze over 400 fees, and it was determined that overall the department was under collecting the most significant subventions were in our current planning and historic planning services. However, we also determined that the building bureau was over collecting by approximately 30%. Next slide, please. As illustrated in this chart, current planning and historic planning have the largest fee recovery variance at 69 and 40%, respectively. As a whole, the department's invention rate is approximately 11% or $3.64 million. Next slide, please. Development services are recommending both increases and decreases, decreases in fees as well as restructuring fees to align with the services provided. As previously indicated, the theoretical revenue rate would be $1.45 million. The fees would be aligned with the study's recommendations, with the exception of historic of certain historic and current planning fees. Next slide, please. Although historic and current planning fees are not at full cost, recovery staff has recommended recommending that certain higher historic and current planning fees be phased in over a 2 to 3 year period because of the nature of the increases. Staff will evaluate the increases each year to determine if there was a need for an increase. Next slide, please. This slide provides a summary of the proposed changes to the fees. As indicated, 41%. Rather, 170 applications are proposed to be decreased, whereas 27% of the other fees are proposed to increase for 114 total fees. At this point, we are recommending that no changes be made to our to certain fees, particularly our fees, as we need further study to better assess the vacancies and the COVID impacts that we've had. As indicated on the next slide, 19% of the fees are proposed to be restructured to align with services. New fees for new programs or services with no fees such as a short term rental program and appeals are also proposed. Next slide, please. In an effort to compare our fees and to determine the competitive nature of of Long Beach versus other communities. We did do a comparison, but please note that it's difficult to compare with each jurisdiction because of the potential in difference in a difference of service delivery model. And we may those other communities may be under collecting for that similar service. That said, staff selected a few common fees and found that they were within the range of other cities. Next slide, please. This slide provides several examples of some of our most common permits. Just to highlight a few of those. The CHP, for example, at 8400, is within the range of other communities, although a range of other communities. As another example, the hypothetical 2500 square foot addition at 4500 lies also within the middle range of other communities. And that's it. Thank you. I'll turn this over to Grace for further information. Great. Thank you very much. So wrapping up this presentation, in summary, the city is generally under recovering for costs based on the studies done for health parks and development services. The three departments are proposed recommendations that are generally aligned with the study's finding for full cost recovery. However, as we've mentioned tonight, there are deviations from the study's findings where the department proposes setting fees lower than the cost of service based on prioritization of other goals, such as program participation, competitiveness, maximizing revenues, residents needs and ability to pay, etc. The theoretical revenues potentially generated from the proposed fee changes will be evaluated and if adopted by council included as appropriate as part of future proposed budget processes in line with our financial policies. And lastly, these proposed changes discussed today, along with other changes to the master fee and charges schedule, is scheduled to come before council on May 18th. City Council can officially adopt these changes on that date. This concludes the presentation and Geraldine, myself and the departments are available for questions. Thank you. All right. Thank you. I'm going to take over. At this point, I don't have the cue system. So I'm going to call I'm going to call through council members from 1 to 9 and just let me know if you have comments. Council District one. Thank you, Vice Mayor. I just wanted to thank staff for this presentation. One of the things that I'm looking forward to is not seeing fees increase for our residents. Right. Especially during this pandemic. But I really look forward to in the near future getting the opportunity to really dig deep into this presentation and the fees themselves. So thank you very much for this presentation to start. Fantastic. Thank you. Council District two. Yes, thank you. The ICE mayor. And I also want to thank the staff for this presentation. One of the things that, you know, we hear a lot about is that, you know, government is inefficient. And so I just want to make sure as we're looking at our direct and indirect cost, that we are looking at restructuring any . Of our products or. Services just to make sure that we're being efficient as can be. And and definitely want to make sure that we are aligning our fees so that all of our residents can utilize our services. And that it's, you know. Accessible and affordable for all of our residents. So where you think you. Thank you. Council District three. Thank you very much. Appreciated that presentation. Thank you very much to all of the departments that presented this evening. I do have a question for our PRM team. The first thing is I. Want to acknowledge and really thank you for being able to take a look at our swim of fees and reducing those. I think that's a really fantastic. I like that we were able to reduce those both for adults and youth and really try to promote some more aquatics programing so that the residents can take advantage of that , that offering that we have. So that that's really fantastic. I did have a question on page. 57 of the 455 page Appendix A. There are some increases for group rentals. And. The rate seem to increase based on the number of people. But then there are different categories. So if you look at, for example, item number 436 for a group rental of 41 to 80 people, there's a certain cost. But then if you look at 440 for a group rental, 41 to 80, there's a different cost. Is that is that based on the venue or is there a different table that goes along with this with this appendix that I'm not aware of? Yeah, Councilwoman, that's a good question. So in many in many cases depends on the change of venue, but also as the group size increases for pools, it does require a ratio of increased lifeguard coverage. So that could be a factor that's clearly distinguishing some increases. But yeah, we were pleased to keep a lot of our rates are swimming rates for the general public at or at a reduced level. Thank you. Okay. Got it. Yeah. I don't think I have any additional questions. I mean, obviously we have to strike a balance in terms of the the services that we provide and the fees associated with those. And I'm sure that metric is different for each department. I will say when I was looking at. And I just sent. A photo of it to someone on our staff when I was looking at the development services fees, one of the biggest fees we get complaints about from people is the concessional conditional use permit fee. And it's noteworthy and I think it's worthy of mention that our conditional use permit fee is much lower, I think, than other cities of our size, or at least along the same lines, insignificant in terms of the difference if there is an increase from other jurisdictions. And I think that's really worth noting and something that I hope to cite in the future if that complaint is directed at the city, because I think that it takes a tremendous amount of work to process those conditional use permits and to be able to do it at a rate that is consistent with and in many cases lower than neighboring jurisdictions. I think it's worthy of mention. So thank you very much for the presentation tonight. Thank you. Counsel before. Thank you, Mr. Vice Mayor. I have kind of a general question. I can certainly wait till the 18th to sort this out. But just to kind of plant the seed. So I understood that one of Grace's concluding remarks was that in some cases, we have fees that do not cover the cost. Conversely, I assume to balance that budget, you'd have to pay fees that are over the cost. So if we can kind of cover that topic on the 18th, I greatly appreciate it. Thank you. Thank you. Edition five. Thank you. I've been working towards this report for several years, and I think that the pandemic has really highlighted the disparities in our systems and the great need for us to be able to target specific. Reductions in fees through need and need is not always determined by a person's participation in a type of program, but really their true costs and burdens and in their position in life. And so one of the things that I think is really important is for us to continue to work towards a universal access card for Long Beach, where a person could qualify for assistance, and that card would then allow them to receive lots of our services at a reduced rate. So an example of that is in another jurisdiction. The Junior Lifeguard program is. $540 per session. However, if you meet a certain threshold, you get a subvention of somewhere between ten and 90%. So that would really target pulling in communities that would not otherwise have had those opportunities. Instead of spending a program on the whole. Next, I would say that there are certain costs that we haven't because we've always invented them. And in certain cases I think that. Some individuals need that support more than others. So an example might be, and I try not to pick one out, but I think that the the example is important. If a vital record service is subsidizing the costs by 49%, and then we say if we were to do true cost recovery, then we would be at a 113%. And I wasn't clear it was 113% of L.A. County's fee or our fee, but a birth certificates, $28. And if you're a family that needs assistance and aid, $20 is still a lot of money versus a family that may have had. Means and was able to provide. A different level of of opportunity. They would be comfortable paying the $56 for the birth certificate. And I think that we do ourselves a disservice as a city just reducing the fees for every unit of every person. And I think that we as a city would be able to provide more assistance to the people who need it most. If we were able to really push forward with our qualification card and the reason I say that is I had a discussion with another councilmember today that was really enlightening about how do we get people in the system? Well, people are already qualified if they're a resident of Long Beach through the utilities. So even if you don't have an ID card, you may pay utilities in our city. And so if you've already gone through the process, either with Southern California Edison or the Long Beach Community Action Partnership or with the gas company or the water company to demonstrate that you're of low income, you should be able to scan your card anywhere that services are needed. And we should be able to, as a council, determine that there are programs and services that you need that we should subsidize. And then, on the other hand, if you're not in need of those services today, we had a great presentation at the Infrastructure Committee by Mr. Mario Cordero, who talked about the K-Shaped recovery, where certain people and certain income groups have amassed more wealth in the last year with the inability to spend money than they've ever needed to before. And I know that that's apparent in my community that has median incomes that range from the I guess it doesn't range because it's an actual number, but this year's numbers not out yet. We have a high increase in permit requests. And so if we're not burdening the true cost of those permits onto the person and applying, then the the catch on that is that then their projects are often delayed. So there are people who tell me I would have paid the extra $200 if you would have let me process my roof, because not letting me process my roof means that there's significantly more costs because now I have a leak and that leak has caused this and that and the other. And now my costs are $3,000 more because I wasn't able to get the services I needed in a timely fashion because we either vented the costs and did not have enough staff. I know that COVID was a specific, unique scenario in development services this year, but. It's important for us to put a couple of things of messaging on everything that has a fee associated, in my opinion. I believe that we should put on any document that states a fee that the city does not make money on residents, business owners or landlords, that the true cost of recovery of this service would be. X So let's say there was a fee that was 80 $500 this up and Councilman Price brought this up. We get a lot of requests to reduce the cost of a cop. Perhaps it would make sense for us to say that the city does not make money through fees. Therefore, cost recovery. The true cost recovery of this fee would be $12,860. Through an action of the City Council. We are supporting this fee because we believe there's a value in having a conditional use permit presented to the Council. And so to incentivize that, we reduce the fee by 25% and your fee is 80 $500. Councilwoman, obviously that's. Your 5 minutes is up. Thank you. Obviously, that's very verbose and we could hone that down considerably. But I plan to meet with each of the department heads that have gone through this process so far. I look forward to hearing their insights and and opportunities for improvement. And I have some specific questions on some specific fees, but I guess I'll meet with them individually on that. But there's one thing that's happening in my district that doesn't have a fee associated with it and that individuals should not get a free service if we don't feel that there's a need to segment it because there's not a value that the city as a whole. Thank you. All right. Thank you. Council District six, please. I just want to thank staff for the presentation, and I think it's really important and I appreciate the process that takes of getting us a report on user, just the fees and reviewing it. And I look forward to our May 18. As you know, they're similar. My colleague just questioning how we can ensure that the fees are done in in a way that ensure services are appropriately provided in consideration of those it's serving. So so that's pretty much it for me on my end. Thank you. I think. All right. Thank you. Council District seven, please. Thank you, Mayor. Well, the most important is, I think that this study really comes out of the fact that we really have to look at market based fees, what's out there, what can the market tolerate in regard to some of the structures that we have in many of the services to make sure that, you know, at these things, you said it best right there to make sure that that people understand that the fees that we're charging is not because we're out to make a buck, but because we're providing a service. And I think that's very important that we get that message out, that the fees that we had is a cost, recovery of the cost for our employees out there, of vehicles, of gas, whatever, whatever it takes, all the other infrastructure type type of costs that we have to bear and those fees cover those costs. So, I mean, it's very important that we get a real robust market fee structure in there in place to make sure that we are aligned with what our neighbors are doing so that we don't overprice ourselves out of the market to to have people eventually say, I'm leaving Long Beach because you're just too expensive. I know that comes up a lot with with our license fees or business license fees. We get that all the time. I get that all the time. But you guys cost too much. Also, we were always been criticized for the fact that our parking fees seem to always be going up. And, you know, we have to be careful about if we have an increase in fees, we have to make sure that it's within the market and what and what people can stand. So I'm looking forward to the 18th. We will be able to have a more robust discussion on this and be able to review all the other 1000 fees. Are there 2000 fees that will be reviewed across all the department? So I want to thank staff for an overview. Thank you. Thank you. Council District eight. Thank you. Join. Want to join with my colleagues in thanking staff for this detailed presentation. I think we missed this a few weeks ago, but I'm glad we are. We're having this conversation. It's very enlightening. I, I want to just to sort of give recognition to our previous form about budget share Stacie, Margo Councilmember lingo for being or harping on this issue of subversion. And I think the first time I heard that term, I was doing a, B or C meeting and she's been talking about this for some time. And so to have this report, I know it's something that she's been working towards for for some time. And so I want to thank her and especially our financial management staff, but all the departments who participated in this, this is very eye opening, understanding that our mission is service as a city. It's not we're not a corporation. And so we don't necessarily need to balance the cost. But I think we should do a better job of cost recovery where we can. And this gives us a really bird's eye view of where opportunities could lie, but also where where we we we may have some some challenges. I want to be mindful of the 23 projected shortfall that we have. And and this is a great opportunity for us to start making adjustments to to address some of our budget challenges that we know we will be facing in the very near future. And, you know, based on what I'm seeing are our we've got a $55 billion subvention and the recommendations from staff is is to recover about $2 billion of it here. I think we can do better, better. And this council I put upon each and every one of us to go and dig a little deeper and look at , you know, where we can, you know, make make adjustments. I did have a question for, I guess, that our city manager is when it comes to subvention in terms of local government practices, is there any sort of like standardized? Methodology to to to understand switching cost. And where we should be. Is there is there a standard or best practice recommended councilmember Austin. We do have city are part of our city wide financial policies is a policy on cost recovery and our financial policies that council have adopted is that we would cost recovery at the rate of service except when there are other priorities that the Council deems as higher. And as we mentioned during the study and the departments also addressed this as well. There may be other goals such as program participation, staying competitive in the market, different ways to maximize our revenue, looking at our residents needs and abilities to pay. Overall, I think cities in general do factor in all of these things when setting their rates and for their cost recovery. And our goal for these citywide studies that we're doing right now is to get to the data and the facts for what the data tells the subvention rate is. But then also each department is customizing and looking and evaluating with the consultants what is our goals and our priorities and why we might be setting rates at a lower level than the actual cost of city. So and one thing just to clarify from a comment earlier is we are not setting any fees higher than the cost of the service, at least not intentionally. And so part of the goal of this study is to to make sure that we know that we are not doing that and getting the data and the facts so that we know if there is any overages will bring them down and if there is subvention to evaluate whether or not we want to bring the cost up to cost recovery or to continue this event for these other purposes. Thank you. And I just had a clarification on that. I'm sure we'll have a lot more discussion on May 18th, but I want to get some clarification. Were all of the funds considered here, general for or for other departments, or were other funds factored in reserve? So health fund is in the health department is almost all health fund fees in the Development Services Fund. It was a little bit of general fund, but almost all of it is Development Services Fund, which is a fully contained enterprise and is designed to be cost recovery and self-sufficient. And then in Parks and Rec, it's mostly general fund, but there's also some tailwinds there as well. So related to the Marine bureau, would that be tailored mostly? Yes, sir. Okay. Thank you. And no further questions. Look forward to more conversation about this. Thanks. Fantastic. Thank you. Just a few thoughts on this. So look forward to this has been a good discussion. Great presentation. I look forward to the discussion in a few weeks. I hesitate to raise fees on. I always hesitate to raise fees on low income families and youth, particularly on quality of life programs. I know that we do full cost recovery, but I think just the staff mentioned it. Sometimes the council has a different priority and historically we've, you know, focused on removing barriers for people to be able to participate in some of these programs. So I would you know, I hesitate to raise any any of those fees, and I don't see those being proposed here. I think our policy on full cost recovery, you know, I think that that's a that's a good thing. Most most businesses that I know and and you know and from what I know, folks, as long as they get a value add, as long as they understand what they're getting for their fee, they're fine paying what the market fee is and and making sure that full cost fees go directly to the city. If anything, folks like seeing it actually come into the city's coffers and not go to a third party contractor to provide service. So these fees, they do support, you know, our city having quality public services and public employees providing those services. So. So I think as long as we keep them, you know, think about the value added, particularly as it relates to the development services fees. If that be into development services, you know, if they're fully funded, they're going to move faster, that people are going to get projects done quicker, ultimately saves money. And so so we just have to think about the value add. The other thing is and this is the issue of raising the past, I'm just going to ask, you know, staff to kind of respond to this. You know, I've I've I've I remember, you know, one time we opened a burger place in North Long Beach. They opened all their fees and they were closed within a year. And, you know, we have areas of town where the failure rate of small business, like they like many, many small businesses, fail in the first three years. We always ask the question, why charge fees in the first place and add to a barrier for a business that we know is going to struggle in this in this particular area of town. And so I would just ask staff, you know, as we're thinking about these fees, are we factoring in and how we go about making sure that we I know we have to make sure fees are fair across the board, but that we sort of, you know, target cents or rebates or whatever it is to make sure that they advance some of these, you know, strategic goals. I would ask staff, how would how would you respond to some of those recommendations in the past about, you know, structuring fees or rebates related to fees to create, you know, more opportunity in areas of the town where, particularly with small businesses, just haven't thrived within within the first three years of establishment. Yes. Vice Mayor. So in that particular instance, that would probably mostly be the Development Services Fund. So again, it's designed as a self-contained fund so that it's not drawing upon general fund. In some of your other areas, we might just say, hey, we just want to cut the fee in half for certain areas or for certain types of businesses, but for their own services. If you if you aren't doing full cost recovery, then you're going to end up having general fund go in and subsidizing that, which we've always tried to avoid. So in that particular instance, we would recommend that you achieve your full cost recovery. You set what the rates are, you make sure you've you're collecting it, and then you create a separate fund, could be Recovery Act, could be something else, and then be really surgical and really intensive about where you want to provide a subsidy. So then you can say these are the types of businesses that fail. This is what we want to try to, you know, create and make it easier for them and use that funding to reduce the burden on the business. Thank you. And it all makes sense to me. You know, I know this is really the forum for that. But, you know, as we move forward, those are things I'm interested in seeing. We have the ability to make things work a little bit easier, particularly in areas that have dealt with generations of the same economic condition. And we have to change the condition in order to have a different outcome. And so those things I'll be looking forward to in the future. Those are my comments. Thank you so much, staff. I see Councilman Mungo's queued up, queued up for a second round, Councilmember. Thank you. Thank you. Councilmember at. I want to address some of the things you said, because I think it really goes back to a discussion that you and I and the council had in 2014 or 15 where. There was a first year refund and rebates program that we did, and we set aside general funds to pay back some of the fees that a business has to pay in the first year that they have a business. And one of the things that was really interesting is the business community really supported the idea that if you open a new business, you shouldn't have to pay the fees for two years. And the council was supportive. We had a unanimous vote. We moved in that direction. Then in alignment with the business community, they said it would be really easy for them to get these refunds. And so it was literally a one page document that had maybe five things to fill out your name, your business, your address, the amount of fees you want refunded. It was simple, and it was at every station in the Development Services Office. And what we found was that in the. Strain and struggle of opening a new business. The number of people that actually applied for it was significantly lower than the anticipated projection by both the business community and the city. So I am in agreement. It would be great if we could figure out a way to. Incentivize opening businesses. I know that from our presentation from Mr. Chrysler Economic Development, our restaurants are on the low end of the number of new businesses in the city and your district. In my district, we don't have as many. But it is interesting as a a person who's opened my own business before, as a person who comes from a family that had 16 businesses in the lowest income areas of Long Beach and a franchise. When you're opening a business and when I interview individuals who have gone through these processes, there's just so much paperwork and guidance at the beginning. And I think that something else that I want to say, Councilmember Sorrow and Councilwoman Allen and you spoke about earlier that has also been a real gem to my heart is really that mentoring and coaching that's available from our Small Business Development Center and other areas. Because when you're starting that business up and you're trying your financials and order and your marketing and all that, this one form, which was the simplest we could possibly make, it wasn't a top priority to these businesses. So we really need to reflect on hopefully times have changed and that would be something that they would be interested in. But I know that we ended up repurposing that money after two years of underutilization. I'm I want to comment on a comment from Councilmember Otunga. I thought it was really a really smart comment to say about market rate fees and as a champion for the libraries and having brought forward many items that waived the fines on books. The way that we're able to do that is because the individuals who can't afford to make those those payments do. And there were some unique stories. I talked to a couple of moms and my mommy group about how Councilmember Ortigas item really brought forward their just knowledge and awareness that they had outstanding books and they ended up not needing to not pay their fines and fees. It was $5 and they felt it was important to pay it. So they taught their children and they did. But the item and the ability to do that is possible when we have market rate fees and other areas, not that we want to raise fees, especially in a time of COVID, but Councilmember Austin's point about the best practices of cost recovery, the city would have $55 million to target and say, we believe that the most important thing in these communities is considered an apex to health. And so we don't want to have sports fees, and we could do that if we were cost recovery in other areas. But it's about tough choices. So I know one of the things that happened in another area that I worked in, in another government was when we found out what those cost recoveries were. We also put ourselves on a three year path for cost recovery. We did not burden those entities with the full cost recovery in the first year. And so potentially that would be a strategy. We know we're in a deficit. I would love to be in a position where we had the Long Beach access card, where families that needed it most and qualified for income assistance could scan. And when they needed to go to Eldorado Park or when they needed a park at the library, they would pay nothing but individuals who were making $180,000 a year, $400,000 a year, which we're very fortunate to have lots of people in our community that do that. Perhaps it wouldn't make the most sense to be subsidizing their parking or subsidizing their $7 to go to the park. So I think that those are the ways in which we really get the communities that need it most instead of just an overarching fees, our fees, and we should lower them all because they're high, then we don't really get to use the funding to help the communities and lift them up in an equitable way. So those are just some of my thoughts and I hope that. The transparency component of this is appreciated because I think it's important for each of us to know what the true cost of things are so that we as a city and as individuals can prioritize where we believe that funding needs to go. So thanks so much. And I don't support raising too many fees. I'm in the downturn, the economy, and I never support raising them on our our families that are most need. But I think it's important for us to make those tough decisions. That's why we were elected. So thanks so much. All right. Thank you. Any public comment on a study session? No public comment. All right. Let's go ahead and have a roll call. We need a motion and second to resume on file. Some moved. Moved. Okay. I think I saw Austin second. Or is that your second? Okay. All right. Let's go ahead to the roll call vote. I'm sorry, who is the seconder on the motion? The usually ranga. Ranga? So Zondi house was a mover or ranga was a seconder. Right. Okay. District one. I. District two I, district three. I, district four. I. District five I. District six i. District seven. I. District eight. By District nine. I motion carries. All right. So that satisfies the agenda. As we close, I'm going to go to four new businessmen, go to council member Zoro first, who has a request to close the meeting.