HomeMy WebLinkAbout07/05/2005, PH2 - MULTI-DWELLING RENTAL PROPERTY INSPECTION PROGRAM FEE MODIFICATION 1
council MfaDM July 5,2005
j acEnaa uEpoizt
CITY OF SAN LUIS OBISPO
FROM: Wolfgang Knabe, Fire Chief4-
SUBJECT: MULTI-DWELLING RENTAL PROPERTY INSPECTION PROGRAM
FEE MODIFICATION
CAO RECOMMENDATION
Adopt a resolution amending the multi-dwelling rental property fire and life safety inspection
fees as follows:
1. Modify the rate structure for fraternities and sororities to be the same as all other
congregate residences (such as hotels, youth hostels and senior facilities),
2. Exempt from these fees low- and very-low income rental units that are built, owned and
managed by the San Luis Obispo Housing Authority, governmental agencies and not-for-
profit housing organizations.
DISCUSSION
On June 7, 2005, the Council approved Ordinance No. 1472 (2005 Series) and directed staff to
reconsider fees set at the May 17, 2005, Council meeting for sororities and fraternities and low-
and very-low income rental properties.
Fraternities and Sororities
The Fire Chief and Finance & Information Technology Director met with fraternity and sorority
representatives who gave public comment at the June 7 Council meeting. These individuals
expressed concern about a lack of equity in the fee structure. A consensus was reached that the
fraternities and sororities could better reach equity by placing them in the same category as all
other congregate residences such as hotels, motels, beds & breakfasts, youth hostels and senior
facilities. For most sororities and fraternities, this will result in a reduction in annual fees from
$477 to $202.
Low-and Very-Low Income Properties
In order to mitigate the impact of these fees on the providers of subsidized rental housing for
low- and very-low income households, we recommend exempting from these fees low- and very-
low income properties that are built, owned and managed by the San Luis Obispo Housing
Authority, governmental agencies and not-for-profit housing organizations. The fee exemption
will only apply to properties where all rental units within the property are used for the purpose of
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Multi-Dwelling Rental Property Inspection Program Fee Modification Page 2
providing low- and very-low income rental units. The exemption must be driven by the nature of
the owner as tenants change over time.
CONCURRENCES/PUBLIC NOTIFICATION
The City Attorney, Finance & Information Technology Director and Community Development
Director concur with the recommended actions. Notifications of this Council meeting and the
staff recommendation were sent .to fraternities and sororities, Housing Authority, and not-for-
profit groups that provide low- and very-low income housing. As noted above, representatives
from the sororities and fraternities concurred with the proposed fee changes at the staff meeting
with them on June 5th.
FISCAL IMPACT
The recommended fee structure is presented below. To attain the equity they have requested,
fraternities and sororities would receive a $275 annual fee reduction (from $477 to $202 for
houses with 30 or fewer units, which covers all applicable units at this time), which is the same
rate structure for all other congregate residences such as hotels, youth hostels and senior
facilities. This would result in a revenue loss of$3,900 compared with existing rates.
Exempting the low- and very-low income rental properties would result in a net decrease of
$26,400 in overall cost recovery. Compared with full cost recovery, the annual shortfall for the
program would be $54,700, which is $30,300 over the original projected shortfall of $24,400.
While not full cost recovery, this revised fee structure better addresses the equity concerns, and
still results in a cost recovery of 86%, compared with the current cost recovery of 94%. The
$54,700 reduction in original revenue projections will be taken from the 2005-07 General Fund
ending fund balance and results in less than a 1% impact.
MULTI-DWELLING RENTAL PROPERTY INSPECTION PROGRAM
Recommended
COST RECOVERY
Hotels,Motels,Bed&Breakfasts,Youth Hostel,Senior Facilities
1-30 Units 2,800 2,800
31-80 Units 5,100 5,100
>80 Units 4,400 4,400
Sororities,Fraternities 6,700 6,700
Fee Reduction-Reduced by$275/Facility to be Equal to Hotels,Motels,etc. (3,900)
Typically sororities,fratemities do not have more than 30 units($202)
Apartments-Facility Charges
Admin.Rate. 32,200 32,200
County Tax Rolls i,000 1,000
Facilities>500 Units 30,000 30,000
Low-and Very-Low Income Housing(Exempt-41 Facilities) (2,700)
Apartments Per Unit Charges 288,200 288,200
Low-and Very-Low Income Housing-473 Units (23,700)
TOTAL COST RECOVERY 370,400 340,100
TOTAL PROGRAM COSTS 394,800 394,800
ORIGINAL SHORTFALL
NET SHORTFALL DUE TO THESE MODIFICATIONS 30,300
TOTAL •- •• 00
Multi-Dwelling Rental Property Inspection Program Fee Modification Page 3
ALTERNATIVES
Alternative 1
Council could decide to grant a partial exemption (50%) rather than a full exemption (100%) for
low- and very-low income rental properties. This alternative includes the same fee reduction for
fraternities and sororities as in the staff recommendation (from$477 to $202). A 50% exemption
for the low- and very-low income rental properties would result in a higher cost recovery rate
(90%) than the recommended one, since revenues would increase by$13,300.
ALTERNATIVE 1 - MULTI-DWELLING RENTAL PROPERTY INSPECTION PROGRAM
5/17105 Reduction &
Fees 500' Exemption
Hotels,Motels,Bed&Brealdasts,Youth Hostel,Senior Facilities
1-30 Units 2,800 2,800
31-80 Units 5,100 5,100
>80 Units 4,400 4,400
Sororities,Fraternities 6,700 6,700
Fee Reduction-Reduced by S275/Facility to be Equal to Hotels,Motels,etc. (3,900)
Typically sororities,fraternities do not have more than 30 units($202)
Apartments-Facility Charges
Admin.Rate. 32,200 32,200
County Tax Rolls 1,000 1,000
Facilities>500 Units 30,000 30,000
Low-and, Very-Low Income Housing(50%Exempt-41 Facilities) (1,300)
Apartments-Per Unit Charges 288,200 288,200
Low-and Very-Low Income Housing(50%Exempt- 473 Units) (11,800)
TOTAL COST RECOVERY 370,400 353,400
TOTAL PROGRAM COSTS 394,800 394,800
ORIGINAL.SHORTFALL24,400 24,400
NET SHORTFALL DUE TO THESE MODIFICATIONS 0 17,000
TOTAL •- 00 00
Alternative 2 —Council could decide to make no changes to the fee schedule approved on May
17, 2005. Compared with the staff recommendation, this would result in a cost recovery rate of
94% with a$24,400 shortfall, which is the level approved by the Council on May 17, 2005.
ATTACHMENT
Resolution amending the City's master fee schedule.
G:/Council Agenda Rcports/Rrntal lnspection/CAR-Modified Fees—Fraternities&Low Income
a .3
ATTACHMENT 1
RESOLUTION NO. (2005 Series)
A RESOLUTION OF THE COUNCIL OF THE CITY OF SAN LUIS OBISPO
AMENDING THE CITY'S MASTER FEE SCHEDULE AND MODIFYING THOSE FEES
FOR THE RECOVERY OF COSTS RELATED TO FIRE AND LIFE SAFETY
INSPECTIONS OF ALL MULTI-DWELLING RENTAL PROPERTIES
CONTAINING THREE OR MORE DWELLING UNITS AND
AUTHORIZING COLLECTION OF THESE FEES FOR 2005-06
ON THE SECURED PROPERTY TAX ROLL
WHEREAS, the City of San Luis Obispo is required by California Health & Safety Code
Section 17921 to annually inspect multi-dwelling rental properties containing three or more
dwelling units, including apartments, hotels, motels, lodging houses and congregate residence;
and
WHEREAS, a typical fire and life safety inspection at these facilities would include, but
not be limited to, checking fire alarm systems, fire sprinkler systems, fire extinguishers, common
areas for fire hazards, exiting and fire access issues; and
WHEREAS, California Health & Safety Code Section 13146 authorizes cities to charge
property owners in recovering the reasonable costs of providing these annual inspections; and
WHEREAS, it is the policy of the City of San Luis.Obispo to review service charges on
an ongoing basis and to adjust them as required to ensure that they remain adequate to achieve
adopted cost recovery goals; and
WHEREAS, in accordance with this policy the Council adopted Resolution No. 9130
(2001 Series)updating the master fee schedule; and
WHEREAS, the Council considered amendments to the master fee schedule at a public
hearing on May 17, 2005 based on a detailed analysis of costs and funding requirements to meet
adopted cost recovery goals, and adopted Resolution No. 9684 (2005 Series) setting fees
providing for 94% cost recovery for state-mandated fire and life-safety inspections;and
WHEREAS, on July 5, 2005, the Council considered reducing the fees set on May 17,
2005 for sororities and fraternities and very low and low income households.
NOW, THEREFORE, BE IT RESOLVED by the Council of the City of San Luis
Obispo as follows:
SECTION 1. The City's master fee schedule is hereby amended by the addition of the
modified multi-dwelling rental property fire and life safety inspection fees as set forth in "Exhibit
A" attached hereto.
SECTION 2. These fees shall be effective immediately.
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Resolution No. (2005 Series)
Page 2
SECTION 3. As authorized in California Health & Safety Code Section 13146.2(b) and
Municipal Code Section 3.50, these fees shall be collected on the secured property tax roll for
fiscal year 2005-06. A listing of fees by assessor's parcel number shall be provided to the
County Auditor-Controller for collection on the 2005-06 secured property tax roll in accordance
with their schedule and data format requirements.
SECTION 4. Those provisions of Resolution No. 9684 (2005 Series) not inconsistent
with this resolution shall remain in effect.
Upon motion of seconded by , and on the
Following roll call vote:
AYES:
NOES:
ABSENT:
the foregoing resolution was adopted on July 5, 2005.
Mayor David F. Romero
ATTEST:
Audrey Hooper, City Clerk
APPROVED AS TO FORM:
Jonat Lowell, City Attorney
Resolution No. (2005 Series)
Page 3
EXHIBIT A
Multi-Dwelling • • - • Life Safety InspectionSchedule
Apartments
$50.00 per unit per year
Administrative Fee of$67.00/year per facility
$15,000 maximum per property
Fees are waived for units that are built, owned, and managed by the San.Luis Obispo Housing
Authority, other governmental agencies, or not-for-profit housing organizations.
Hotels, Motels, Lodging House,Bed & Breakfast Facilities, Youth Hostel Facilities and
Senior Facilities,Sororities,Fraternities and Other Congregate Residences
1 to 30 units $202/year per facility
31 to 80 units" $302/year per facility
More than 80 units $402/year per facility
These fees are applicable to all Multi-Dwelling Rental units in the City based on the following
definitions as set forth in the 2001 California Building Code, Chapter 2: Definitions and
Abbreviations, Section 201.
Apartment house is any building, or portion thereof, which contains three or more dwelling
units.
Congregate residences are any building or portion thereof that contains facilities for living;
sleeping and sanitation, as required by this code, and may include facilities for eating and
cooking, for occupancy by other than a family. A congregate residence may be a shelter;
convent, monastery, dormitory, fraternity or.sorority house, but does not include jails, hospitals,
nursing homes, hotels,or lodging houses.
Dwelling unit is any building or portion thereof that contains living facilities, including
provisions for sleeping, eating, cooking and sanitation, as required by this code, for not more
than one family, or a congregate residence for ten or less persons.
Hotel is any building containing six or more guest rooms intended or designed to be use, or
which are used, rented or hired, out to be occupied, or which are occupied for sleeping purposes
by guests.
Lodging house is any building or portion thereof containing not more than five guest rooms
where rent is paid in money, goods, labor or otherwise. (A lodging house includes bed &
breakfast facilities and hostels,but excludes single family dwellings).
Motel shall mean the same as hotel as defined in this code.
RED FILE
June 29, 2005 MEETING AGENDA
DATE 7 SAK ITEM #��
Mayor Dave Romero
990 Palm Street
." VLA San Luis Obispo, CA 93401
GREEK LIFE
Dear Mayor Romero,
I am writing in regards to the adoption of Public Hearing item 2, concerning the
mandatory fire inspection fees, that will be voted on at the July 5`h City Council meeting.
Thank you for asking city staff to work with members of the Greek community to derive a
fair compromise as it relates to this fee.
CAL POLY STATE
UNIVERS'TY As you are aware we have deep concerns as the fee structure currently stands:
Student Life&Leadership
UU 217 1. For level of service received, this fee is extremely excessive.
San Luis Obispo.CA 93401 2. Fraternities and sororities are placed in an unfair fee category not consistent with
comparable structures and residences.
Phone:805.756.2476 3. The fee is a tax on low income students.
Members of the Greek community met with Fire Chief Wolfgang Knabe and Finance
Director Bill Statler to reach a fair compromise in regards to the fire inspection fee as it
relates to fraternities and sororities. Chief Knabe and Mr. Statler agreed to recommend a
reduction in fee revenue from.fraternities and sororities to $2,828. The change in fee
structure as recommended by city staff is a fair alternative to the current excessive fee
netting$6,678 from the Greek community.
Greeks have been at the forefront of implementing many philanthropic and service
programs that benefit not only the non-profit community,but city programs such as the
Prado Day Center. Greeks also supported the city's Mardi Gras position and took an
active stance to encourage safety and responsibility. I respectfully ask that you consider
these amendments to this ordinance as it marks another big step between the city and the
Greek community. We look forward to continuing to foster a positive relationship
between city officials and Cal Poly's fraternities and sororities.
If you have any comments or questions please feel free to contact me at (916)316-0232 or
mmotroni@calpoly.edu. Thank you for your co
L] OUNC _ - CDD DIR
Sincerely, d CAO FIN DIR
L� ACAO FIRE CHIEF
Cli ATTORNEY PW DIR
CLERK/ORIG POLICE CHF
DEPT H-rE- S REC DIR
Mike Motroni, President �! l� u iL DiR
L11 _/�/./3----- 'n, HRDIR
Interfraternity Council — -
Cc: SLO City Council, Gretchen Schultz, Eddie Dominguez, IFC & Panhellenic
Presidents
RECEIVED
JUL O 1 2005
ASLO CITY COUNCIL
° ® .Peoples' Self-Help Housing Corporation
RED FILE
July 1,2005 MEETING AGENDA
city Council DATE 7 rOj'ITEM #
City of San Luis Obispo
990 Palm Street
San Luis Obispo, CA 93401
Honorable Mayor and Distinguished City Council:
SUBJECT: Multi-Family Residential Rental.Inspection Fee Modification
Exemption to Low- and Very-Low income Properties
Peoples' Self Help Housing Corporation(PSHHC), a locally based 35-year-old non-profit with a
highly successfully record creating and managing affordable housing for low- and very-low
income households in San Luis Obispo County,as well as Santa Barbara County and Ventura
County, strongly urges you to support the proposed"Multi-Family Residential Rental Inspection
Fee Modification" exemption to low- and very-low income properties,which has been
recommended by City Staff. Providers of permanent affordable rental units hike PSHHC, which
serves over 5,000 families annually, rely on local government partners; not only to construct
affordable housing, but also to maintain its permanent viability in order to adequately serve the
families it intends to assist.
Although your constituents are demanding it,the local business community believes it is lacking
in our area and the State mandates more of it, affordable housing development and management
are becoming more challenging to do, financially. Many of the costs associated with projects
such as ours are escalating at a very high rate, and although we have been recognized in our
industry as very efficient and sensible in our management practices,we simply do not have
control over many of these costs. A possible exception to this trend though comes from
governing leaders lice yourselves who have a.stake and commitment to maintaining this
community benefit on a long-term,permanent basis,who are willing to help mitigate the impact
of new proposed fees that are counter-productive to subsidized rental housing.
Sinec keeping rental housing for lower income households viable is in accordance with our
common goal,we ask for your support of City Staff s recommendation,to exempt not-for-profit
housing corporations from the new proposed annual fire and life-safety inspection fees.
Sincerely,
D COUNG`1L CDD "RC CAO FIN DIR
ACAO TIRE CHIEF
Jeanette Duncan , CI ATTORNEY PW DIR
Executive Director J CLERK ORIG POLICE CHF
L DEPT HEADS REC DIR
JD:J7ci RECEIVED I ��Qh�TICC�a
JUL 0 5 2005
3533 Emp(eoStreet SLO CITY CLERK
San Luis Obispo,California 93401 26 E.Victoria Street F7
TEL- (M)781-3088 Santa Barbara,California 93101
FAX; (805)544.1901 TEL (805)962-5152
E-mail;admin(apshhc;org FAX: (805)962-8152
www.pshhc.org Email:s6o{fice@pshkcorg
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