Updated: Sep 13, 2021
In just about every project we work on our client city asks for a fee comparison to neighboring cities. And just about every time we reply with the remark that fee comparisons are not useful. No two fee schedules are alike, and in the end, an examination of other fee schedules just proves this point.
Cities offer different services – Some cities contract for service with the County or another agency. Some cities contract with private companies for planning, building, engineering, business license, or utility billing services. All this affect the cost of service and fees charged.
Cities have different processes – Cities vary significantly in their development processes, based on years of changes to their municipal code. City Council, Commissions and management implement differing process that work best for them.
Cities have different fee structures – One city set building fees based on project valuation while the next is based on square footage. One city may set park reservation fees by number of participants, while another has a flat rate. Some cities may charge for the number of tables and chairs within a facility.
Cities have different amenities – Not every city has a community center to rent out, or library meeting room for community use. Does your city have reservable park space?
Cities have different geography and demographics – A beach city would likely have more complex planning processes or more environmental fees. A younger community would likely offer more childcare programs and youth sports. Your city might be the largest in the county, while others are half the population.
Cities are at different financial positions – We’ve worked with cities which have healthy revenue streams and can offer services for free or at subsidized rates. However, most have budgetary challenges and City Councils adopt fees which are full cost recovery.
Cities don’t conduct fee studies at the same time – When was the last time your neighboring city performed a fee study? While we suggest every five years, it’s too common for cities to have not updated their user fees for ten or more years.
Finally, if we can find two cities that are similar in all these aspects, they will likely be hundreds of miles apart and not compete with each other. Do you really want to compare yourself to your neighboring city in terms of services and fees?
So, it all goes back to what was stated in the first paragraph. Most cities look at fees from other cities and quickly realize it’s not a good comparison. We always tell our clients to be confident of the time allocated to provide their city services. That becomes the user fees that’s best for their community. As the ancient Chinese philosopher Lao Tzu said, “[w]hen you are content to be simply yourself and don’t compare or compete, everyone will respect you.”