Cost Accounting in Local Government

What is required to set fees?

It is generally understood that you need a resolution at a public hearing to set fees.  But is that correct?  It turns out that is not entirely true.

For development-related fees, Government Code Section 66016 and following sections make it clear that you do need a public hearing.  In addition, this code section has the following requirements:

  • 14 days prior to the public hearing notification and a general explanation must be given to all those who requested notification.
  • 10 days prior to the public hearing the backup detail for the fees must be available for review.
  • The fees shall be effective no sooner than 60 days after the fees were approved.

But what about non-development fees?  While there are many code sections that identify specific dollar amounts for specific fees, it turns out there are no code sections that deal with the approval of these fees.  This would involve things like Annual Fire Business Inspection fees, Police Business Background Check fees, Recreation fees, Facility Rental fees, and Business License Application fees, among others.

Without any direction from the Government Code, it appears that the City Council, or even staff, could approve the fees without a public hearing and the fees could go into place the next day.

Fees governed by Proposition 218 that require a vote do have a whole set of requirements that are specified in the Government Code.

As a general rule it is probably still a good idea to approve all of your fees by resolution so as to be completely transparent.  But it appears that is no requirement that you do so for non-development fees.

Like anything that deals with legal issues, run all of this by your City Attorney.

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