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Local government

City of Napa user fees set to increase over next three years

Napa City Hall

Napa City Hall. 

City of Napa residents are set to see the cost of building permits, sports field rentals, and other user fees rise.

Starting Jan. 1, 2022, the city of Napa will require people to pay more for most user fees so the city can eventually recoup 100% of the cost of those services. And those rates will rise even more in the two subsequent years beyond 2022. 

A user fee is associated with programs and services that provide specific benefits to individuals receiving those services — they apply for renting a park, other city property or applying for permits of various types — according to Deputy City Manager Liz Habkirk at a Napa City Council meeting last month.

The city currently subsidizes those services using the city’s general fund. That means full cost recovery would allow for the dollars used to fill in the cost of services to the city to be spent elsewhere. Full cost recovery is the city’s general preference, according to the city of Napa's financial policy, Habkirk said.

If a fee requires more than a 25% increase to be brought to full recovery level, the fee increase will be rolled out in 25% increments over the next three years. Otherwise, the fee will cost the full assessed amount starting next year.

In an attempt to keep pace with rising costs, a 3% annual increase — based on the Bay Area’s average Consumer Price Index annual increases — will also be applied to most fees on Jan. 1 of each of the two years beyond next year.

The cost increases will be steep for certain services. For example, a building permit for a residential bathroom or kitchen remodel currently costs $317, but the current full cost to the city is $561.93. So, under the new fee structure, the cost of that permit will be $398 next year. And in 2024, the permit will cost $596.

Another example: The city’s memorial tree program currently costs $142 per tree but costs the city $539.53. The user price for memorial trees is set to cost $274 next year and will cost $572 by 2024, according to the fee structure.

Some services will remain heavily subsidized by the city but still undergo big increases. The city’s tree service applications processing fee for the removal, planting, or special programs currently runs at a fee of $22.25 per tree but costs the city $449.43. That fee is scheduled to increase to $150 next year and will cost $200 by 2024.

The full cost of the fees to the city was calculated by Willdan Financial Services. The city’s previous fee study and full update was May 2018, which Habkirk said is one of the reasons the city’s rates have fallen far below cost recovery.

“Doing these studies more frequently allows us to stay closer to a full cost recovery … without lapsing and coming into these situations where we have only 52% cost recovery because we’ve gone so long, or because costs have increased so much and the actual cost of the fee has not kept pace,” Habkirk said at the meeting.

Last month, some Napa City Council members raised concerns about raising fees for services related to housing because they said doing so could discourage developers from looking to build housing in Napa. Council member Beth Painter added on a condition that city staff come back to the council before the end of the year with recommendations on a fee waiver program that would apply to housing priced at 120% of the area median income or below.

But council member Mary Luros said subsidizing projects considered either affordable or moderate-income isn’t enough because all types of housing are needed to solve the region's housing crisis. 

“Housing has been the number one concern and priority for the City Council for several years now,” Luros said in an email. “We have focused on removing barriers and costs from the residential building process to make it more streamlined and cost-efficient. With the update in fees, we are going against this by making it even more expensive to build housing in Napa.”

Luros wrote the council alternatively could’ve chosen to subsidize the fees. She said her feeling is lowering fees or freezing them at the current rates would incentivize more new residential developments in Napa.

“In Napa, we need more than just what qualifies as “affordable housing” — we need workforce housing also,” Luros said in an email. “We need housing for people whose income disqualifies them from affordable housing but whose salary keeps them from being able to live here. Encouraging housing development at every level is how we solve the housing crisis throughout the state, and increasing fees on housing development doesn’t get us there.”

City of Napa staff went to Playground Fantástico on Tuesday to plant five new trees in celebration of Arbor Day.

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You can reach Edward Booth at (707) 256-2213.

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