HomeMy WebLinkAboutAGENDA REPORT 2008 0604 CC REG ITEM 09AITEM - C1 • A
CITY OF MOORPARK, CALIFORNIA
City Council Meeting
of � 8
ACTION:..__
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MOORPARK CITY COUNCIL
AGENDA REPORT
TO: Honorable City Council
FROM: Barry K. Hogan, Deputy City Manager
By: David Lasher, Senior Manag nt Analyst
DATE: May 29, 2008 (CC Meeting of 614/2008)
SUBJECT: Consider Resolution for Potential Business Registration Fee
Increase
BACKGROUND /DISCUSSION
Business Registration provides the City with information on businesses doing work in
Moorpark. It is generally the first point of contact with the City and allows staff to review
building, planning, engineering and other information with the prospective business. It
provides the City with a list of those businesses which have hazardous materials on
site, those businesses that would be subject to NPDES regulations and those
businesses which would be subject to other special requirements such as adult
businesses, massage and vendors. Businesses also receive information on how to
operate a business within Moorpark, such as grand opening signs and special event
processes.
The City of Moorpark's current Business Registration program imposes an annual thirty
dollar ($30) fee on each business operating in the City regardless of the size or type of
business. This fee has not been updated since 1989, more than 19 years. Staff's
analysis shows that the current cost of operating the Business Registration program
substantially exceeds the revenue collected from the current annual fee. Currently,
nearly three thousand business entities are registered in the City (2,822 as of April 24,
2008). Annually, an average of five hundred new businesses has been added to the
roster of registered businesses.
Issuance of a business registration involves both office and field work. Since 1989 the
City has improved the business registration process through better use of the computer
and software, improved registration certificates, renewals, document scanning, and field
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Honorable City Council
June 4, 2008
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inspections. These improvements are not covered by the current thirty dollar ($30) fee
for a new business registration or renewal.
In addition to the normal process of issuing a Business Registration Certificate, field
work is necessary to monitor that people doing business in Moorpark are complying with
the City's regulations. For example, staff routinely and frequently identifies businesses
and entities, including contractors, unregistered rental properties and home -based
businesses, that are required to be registered as businesses, but which have not
applied for or received a Business Registration Certificate. Instances such as these are
investigated by the Division. The subsequent costs associated with investigating an
unlicensed rental property or following up on a business that has not applied for or
renewed a Business Registration Certificate in a timely fashion is not covered by the
thirty dollar ($30) fee current charged for a certificate.
New business applications employ more staff time than a renewal application given that
new applications must proceed through the initial application processing, often incur
staff time at the counter and have other processing costs.
Moorpark does not have a business license /tax program. Just as a comparison, in a
few nearby cities that have a business license or business tax program, their minimum
annual fee is set at or near one - hundred dollars.
Comparison to Other Cities in the Region: Business licensing and business tax
programs in the region vary widely and include cities that charge a flat fee and others
that charge a business tax based on annual receipts. In a few nearby cities, the fee is
set at or near one - hundred dollars. For example, Camarillo charges contractors one -
hundred dollars; Ojai charges a flat one - hundred dollar fee, while Fillmore's business
license costs ninety -five dollars. Camarillo maintains a complex business tax program
that encompasses twenty different tiers and tax levels.
Related Services and New Costs: The City Council recently approved a new software
program for business registrations. While this program improves the efficiency of the
issuance of business registrations, there are associated personnel costs as well as
annual costs for related software and licensing. In addition to the HdL business
registration software, staff also utilizes the GIS mapping software, other databases and
field inspections in furtherance of business registrations.
An annual business inspection or visit also needs to be implemented to insure that each
business is in compliance with City Codes. Annual visits will be carried out by Code
Compliance Division staff with support (as needed or warranted) by the Building
Services Division.
Mobile -based businesses are a category that has traditionally had a low rate of
compliance. These are businesses which are generally not located in the City but do
business in Moorpark. Many of these mobile -based businesses perform identical work
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to products and services offered or managed from traditional `brick- and - mortar' -based
Moorpark businesses and should pay the same annual business registration fee. To
greatly improve compliance of mobile -based businesses, staff has designed and is
printing new, larger and more visible vehicle stickers to identity business vehicles (such
as landscaping trucks, contractors, plumbers, electricians, mobile food vendors, and ice
cream vendors) that are associated with entities conducting business within Moorpark.
Business vehicles without the sticker will therefore be identified and then approached by
staff to determine if their business is registered. We are also implementing stepped up
field investigations to improve compliance for mobile -based businesses.
In accordance with the Moorpark City Code, each business is required to display its
Business Registration Certificate. To ensure that this Certificate is displayed and
maintained properly, an acrylic certificate holder is distributed with the issuance of each
new business registration and to existing business owners upon renewal.
FISCAL IMPACT
The City incurs costs associated with business registrations from the moment a phone
call is answered or staff assists a business owner at the counter, completes an
application or conducts a field investigation into an unregistered home -based business.
As shown in Table 1 below, the true cost of processing and issuing a new Business
Registration Certificate approaches ninety dollars. This figure also more closely
matches the one - hundred dollars currently charged by several neighboring cities. The
cost of renewing an existing Business Registration Certificate exceeds forty dollars.
While this is less than the cost of a new business registration, it clearly exceeds the
current fee.
Table 1 - Business Registration Costs
Component
Annual Cost
Associated with
BR Processing
Weighted
Cost of BR
Renewal'
Weighted
Cost of
New BR
Personnel
$81,608.80
$22.53
$50.30
Software Support
$24,121.28
$6.66
$14.87
Supplies and Additional Costs
$39,324.60
$10.86
$24.24
Total
$145,054.68
$40.05
$89.40
' Per BR based on a weighted average, accommodating the lesser cost of a renewal as compared to a
new BR, based on the number of BRs in circulation and the number of new BRs issued in 2007.
Additionally, if the current $30 fee for a Business Registration Certificate had been
indexed to inflation with a cost of living adjustment in the superseding nineteen years, a
business registration would currently cost $51.66.
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Honorable City Council
June 4, 2008
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A revenue estimate of $53,000.00 was established in the 2007 -08 City Budget for the
Business Registration Program. Based upon Staff's research, it is estimated that the
City will expend nearly two hundred thousand dollars administering, processing and
managing business registration- related concerns this fiscal year, a shortfall of $92,054.
In 2007, the Community Development Department issued 649 Business Registration
Certificates for new businesses, i.e. businesses that had not had a certificate previously.
In 2006, 458 were issued. The number changes annually due to a number of reasons.
There are also businesses which drop off the registry annually, just as new startups are
added. Staff calculated the current costs associated with the Business Registration
program based upon a number of fixed factors, such as the cost of software, supplies
and personnel time. The variable is the number of new certificates. The more
certificates that are in circulation results in a lower per unit cost of processing. Staff
used the current number of certificates in our systems as of April 24, 2008 (that being
the aforementioned 2,822) for this report and an average of 500 new certificates. We
would recommend that Staff annual review the costs each year and present an update
and fee adjustment for Council consideration.
In light of the current economic situation, Staff would recommend that City Council
consider blending the fee for new registrations and renewals with a single fee of sixty -
five dollars ($65.00) with the new fee effective on January 1, 2009. The average of the
cost of new registrations and renewals is equal to the proposed $65.00 blended fee. To
ensure that the revenue for the program does not exceed costs, staff will present an
annual update to the City Council beginning in March 2010 (to allow for a full calendar
year under the proposed new fee). Any future fee adjustment upward or downward
could then be implemented in July or January.
Additionally, staff has scheduled a meeting with Mr. Patrick Ellis, President and CEO of
the Moorpark Chamber of Commerce to be held prior to the June 4 City Council
meeting. A copy of this report has been provided to the Chamber as well.
STAFF RECOMMENDATION (Roll Call Vote)
Adopt Resolution No. 2008- to increasing the Business Registration fees
ATTACHMENTS:
1. Business Registration Cost Analysis
2. Resolution
Percentage of
Time
Associated
with BRs
25%
N/A
25%
12%
N/A
100%
30%
20%
100%
100%
Business Registration Cost Analysis
Existinq BRs New (2007)
Weighted at BRs Weighted All BRs minus
60% of Cost at 40% of Cost 2007 (2173) Per 2007 (649)
Personnel: Rate
Rate With
Benefits
Hours Per
Week
Annual Cost
Annual Cost
Associated with
Existing BR
Annual Cost
Associated with
New BR
Annual Cost
Per Unit,
Existing BR
Annual Cost
Per Unit, New
BR
Administrative Assistant
$39.82
10.00
$20,706.40
$12,423.84
$8,282.56
$5.72
$12.76
Consultant
$46.20
8.00
$19,219.20
$11,531.52
$7,687.68
$5.31
$11.85
Code Compliance Technician II
$42.88
10.00
$22,297.60
$13,378.56
$8,919.04
$6.16
$13.74
Senior Management Analyst
$63.66
5.00
$16,551.60
$9,930.96
$6,620.64
$4.57
$10.20
Clerical
$10.90
5.00
$2,834.00
$1,700.40
$1,133.60
$0.78
$1.75
;�S I,OUO.OU P401VOO.Z0 pJL,04J.JL .p GL. JJ w .
Software:
HdL (FY 07 -08)
-
$16,171.281
$9,702.771
$6,468.51
$4.4ZI
$9.97
CityGIS (30% of $26,500)
-
$7,950.001
$4,770.001
$3,180.00
$2.20
$4.90
;OL4, "I L I.LO y14,4/ L.! r �a,o4o.0 1 wv.vv w �•��
Supplies, Support & Miscellaneous:
Account Expenses (see Page 2)
$125,468.00
$25,243.60
$15,146.16
$10,097.44
$6.97
$15.56
3,500 Acrylic Holders
$3.76
$13,160.00
$7,896.00
$5,264.00
$3.631
$8.11
BR Vehicle Stickers
500 Stickers
$921.00
$552.60
$368.40
$0251
$0.57
aav5aI4.ou
Total of Personnel, Software and Supplies: $145,054.68
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Per New Registrations: $40.05
Per Renewals: $89.40
IFJ
�`i
RESOLUTION NO. 2008-
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
MOORPARK, CALIFORNIA ADOPTING A REVISED FEE
SCHEDULE FOR SERVICES RENDERED PURSUANT TO
THE MOORPARK MUNICIPAL CODE RELATING TO
BUSINESS REGISTRATION FEES AND RESCINDING
RESOLUTION NO. 1989 -552
WHEREAS, the City of Moorpark has identified a need to protect the health and
welfare of the public by becoming more familiar with business operations and
procedures in the community; and
WHEREAS, the City Council of the City of Moorpark adopted Resolution No.
1989 -108 enabling the City to administer a business registration program; and
WHEREAS, the fee schedule for these services must be revised from time to
time to assure adequate recovery of all costs associated with the rendering of such
services; and
WHEREAS, on June 4, 2008, the City Council received and considered written
evidence and oral testimony pertaining to a possible increase in said fees in accordance
with Government Code Section 66016.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF MOORPARK
DOES HEREBY RESOLVE AS FOLLOWS:
SECTION 1. The fee for a new business registration certificate or renewal shall
be set forth as sixty -five dollars ($65.00) per permit.
SECTION 2. Payment of fees are due upon submittal of an application
pursuant to City Ordinance No. 89 -108, Section 1, Chapter 5.06.050 (B) "Initial
Application ".
SECTION 3. Fees will be paid annually pursuant to City Ordinance No. 89 -108,
Section 1, Chapter 5.06.060 "Annual Renewal ".
SECTION 4. This Resolution shall become effective on January 1, 2009
following the public meeting held on June 4, 2008, implementing those changes in fees
described herein immediately upon the effective date set forth herein.
SECTION 5. Resolution No. 1989 -552, adopted the 3rd day of May 1989, is
hereby rescinded upon the effective date of this Resolution.
Resolution No. 2008 -
Page 2
SECTION 6. The City Clerk shall certify to the adoption of this resolution and
shall cause a certified resolution to be file in the book of original resolutions.
PASSED AND ADOPTED this 4th day of June, 2008.
Patrick Hunter, Mayor
ATTEST:
Maureen Benson, Assistant City Clerk