What would Menlo Park residents rather subsidize with their tax dollars — recreation programs or development?
It may seem a strange question, but in light of the city’s efforts to raise fees on everything from gymnastics classes to reviewing building plans, it’s a question that needs to be asked.
Revised fees are expected to generate upwards of an additional $1 million annually for the city, a positive development in light of the anticipated budget deficit. However, the recently completed cost-allocation study for Menlo Park services revealed some surprising information about which services recoup their costs from fees and which ones receive significant support from the city’s general fund.
The after-school child care program, for instance, is recovering 100 percent of its costs through its fees. The Planning Department, on the other hand, has been getting only a 51 percent cost recovery on its services. Bringing the department up to 99 percent cost recovery will net the city an additional $600,000 per year, according to Finance Director Carol Augustine. It’s clear that, if the city had paid attention to its cost recovery problems in the department sooner, last year at least a half-million dollars would have been available for other important projects.
Municipalities are entitled to recover all reasonable costs, including staff time and overhead, that come from property development services such as plan checks, building inspections and zoning code reviews. Generally speaking, that’s precisely what cities and towns try to do — recover all of their costs through user fees. On the other hand, nickel-and-diming seniors and families with children in order for Joe Spec Builder to get his plans reviewed at half price strikes us as unusual, to say the least.
The proposed increase in the city’s fee schedule, discussed at the Nov. 25 City Council meeting, was surprising in its revelation of where taxpayer money’s been going. It may be reasonable to ask elderly patrons of the Menlo Park Senior Center to start paying 25 cents to get a take-out container for their lunches, but, for example, should taxpayers have been footing the bill for 74 percent of the cost of planning services when a developer wanted to create a subdivision? With the previous 26 percent cost recovery rate on tentative subdivision maps — a service that now will cost the developer $6,000 — that’s exactly what’s been happening.
It’s one thing for the council to make a conscious decision to subsidize the activities of contractors and developers, as a couple of council members suggested doing, but to do it by default is inexcusable.
Good decisions are impossible without good information. In order to build a sustainable budget for the city, council members need the right tools, namely clear and accurate financial information from staff. Based on the questions — and corrections — that council members asked for during the Nov. 25 meeting, that’s clearly something they have not been getting.
The staff report on the proposed user fees was notable not only for the lack of cost recovery in the Planning Department, but for the many errors and instances of questionable reasoning.
In one example, council members and parents questioned the rationale behind a proposed 7 percent increase in Menlo Children’s Center full-time fees, and sadly, there weren’t a lot of good answers. In the case of the after-school program, the higher fees would have generated excess revenue that would have been used to subsidize other programs. The plan to raise fees for part-time children by as much as 88 percent (from $294 to $552 per month for twice-a-week kindergarteners, for example) was even more strange, and based on the premise that part-timers made scheduling tricky and should be discouraged. The council wisely refused to go along with the staff recommendation.
While you can’t change the past, you can use what you’ve learned from past mistakes to improve the future. The City Council needs to hold City Manager Glen Rojas accountable for the shortcomings of his staff, and he, in turn, needs to hold his staff to higher standards, especially when it comes to the city’s finances.
