For years, the city has been giving developers, even local
citizens, financial breaks on several fees charged as taxes to
support Hollister’s infrastructure.
But on Monday, the City Council took the first step toward
updating more than 20 charges by hiring a firm to conduct a study
for $130,000. Hollister will use that analysis to update its fees,
which officials hope to accomplish by next year’s budget approval
in July.
For years, the city has been giving developers, even local citizens, financial breaks on several fees charged as taxes to support Hollister’s infrastructure.
But on Monday, the City Council took the first step toward updating more than 20 charges by hiring a firm to conduct a study for $130,000. Hollister will use that analysis to update its fees, which officials hope to accomplish by next year’s budget approval in July.
The Council voted 4-1 to hire Temecula–based MuniFinancial, one of three companies offering proposals to the city. Councilman Robert Scattini voted against the contract, while Mayor Brian Conroy and Council members Tony Bruscia, Tony LoBue and Pauline Valdivia voted in favor of it.
Hollister has been vastly undercharging, according to officials – especially on impact fees, many of which have not been updated since 1986.
“It’s a perfect opportunity to get development fees where they should be,” City Manager Dale Shaddox said, “because when we get the green light to do new development in town, we’ll be charging the appropriate fee for a change.”
The fees to be analyzed include impact fees to support police, fire and parks, among others. The user fees under consideration include those mandated for animal control, code enforcement and street sweeping. MuniFinancial will also update water and sewer rates.
The study is especially timely because Hollister is currently constrained by the state’s cease and desist order stemming from the 15-million gallon sewer spill in May 2002. Developers are already lining up for the culmination of that building moratorium, slated for October 2005 when a new wastewater plant is scheduled to for completion.
Officials do not know a precise dollar amount lost over the past 17 years because of lacking updates of city fees, according to Shaddox. Though he said the amount is “considerable.”
“Frankly, I need to spend my time going forward,” Shaddox said.
The hired firm plans to take several criteria into consideration to devise the new fees, according to Shaddox. They will work with such issues as General Plan designations, zoning standards and what buildings are vacant. The fees, according to Shaddox, will be “unique to Hollister.”
Scattini suggested a local staff person survey other local jurisdictions to compile similar cities’ charges. But Shaddox and City Attorney Elaine Cass strongly advised the Council to hire the firm Monday because many of the fees, if inaccurate, are lawsuits waiting to happen.
Two years ago, the City of Salinas updated a storm drain utility fee to cover improvement costs in that system. But it was taken to court over that fee – and lost – because it could not adequately substantiate the extra charge, according to Shaddox.
“We’re not allowed to profit and we need to justify the true cost,” Bruscia said.
Shaddox said the city plans to tie the fees to an annual index, such as the Consumer Price Index or a construction cost index. That, he said, would allow the fees to appropriately escalate without a new study every year: “So we don’t get behind the eight ball like we are now.” He said standard recommendations suggest cities updates such fees within every five years.
With the exception of Scattini, Council members said they feel the $130,000 is a wise investment.
“We need to study the fees so we can get these developers and builders to pay the fair share of impacts on the community,” LoBue said.
In other Council business:
– Established a policy that disallows pre-zonings or annexations for about a year. As a backlog of developers await the expected October 2005 end to the cease and desist order, officials are concerned that prematurely zoning or annexing property – referred to as an “irreversible commitment” in a staff report – may create problems.
– Passed an ordinance to limit the time to two hours that vehicles can spend parked in the city parking lot on Seventh Street downtown. The lot previously carried an unlimited parking time. The change was intended to accommodate retail customers in the downtown area, according to a staff report.
– Rescheduled a hearing originally scheduled for Nov. 24 to consider San Benito Foods’ appeal of a $1.4 million debt payment requested by Hollister. The hearing’s new date is Nov. 25.
The town’s tomato cannery uses the industrial wastewater plant for disposal each summer canning season, services for which the city bills San Benito Foods every year. The two sides disagree on invoice amounts dating back to 1999. San Benito Foods recently filed the appeal contesting the city’s request for the money.
