Item 5: Ordinance Concerning Fee-Setting and Charges

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ECC UGENE ITY OUNCIL AIS GENDA TEM UMMARY Action: An Ordinance Concerning Setting Fees and Charges and Amending Sections 2.020, 2.442, and 6.411 of the Eugene Code Meeting Date: May 29, 2007 Agenda Item Number: 5 Department: City Manager’s Office Staff Contact: Mary Walston Department: City Attorney’s Office Staff Contact: Jerry Lidz www.eugene-or.gov Contact Telephone Number: 682-5406 ISSUE STATEMENT Final action is set on a proposed ordinance to revise slightly the directives to the City Manager for setting fees and charges. The Eugene Code assigns administrative rule-making authority to the City Manager (Section 2.019). In the later sections of the code proposed to be modified by the proposed ordinance, the criteria for setting fees and charges are defined. The proposed ordinance would grant the manager some flexibility in how these criteria are applied. BACKGROUND The impetus for the proposed revision comes from a recent Oregon Court of Appeals decision that interpreted the Code more strictly than staff believes was intended. In providing directives to the City Manager for setting of fees and charges, the current language in Section 2.020 states: In determining the amount of any such fee, the City Manager shall consider: a) Applicable policies, enactments and directives of the council; b) The amount charged by the City in the past; c) The full costs of providing the service supported by the fee; d) The amounts charged by other comparable providers; and, e) The revenue needs of the City as determined by the adopted City budget. In 2002, the City Manager issued an administrative order setting fees for utilities’ right-of-way use permits. Comcast subsequently challenged these fees in circuit court, which upheld the fees. Comcast appealed to the Oregon Court of Appeals, which declared that the fees were invalid because the City Manager had not expressly considered “the amounts charged by other comparable providers.” City staff had deemed that step unnecessary, because another provision in the Eugene Code, Section 7.300, expressly requires the fees for these permits to be set “in an amount sufficient to fully recover all of the City’s costs related to [the permit program].” Despite that specific directive in the code, the Court of Appeals concluded that the right-of-way permit fees were invalid because the mandatory comparison to other “comparable providers” was not completed. The change to the fee-setting process in the proposed ordinance is narrow. It would allow the City Manager not to consider one or more of the factors listed in EC 2.020 if – but only if – the manager makes written findings that a particular factor is irrelevant or inapplicable. For instance, in setting the fees challenged in the Comcast case, the City Manager could have accompanied the fee order with a L:\CMO\2007 Council Agendas\M070529\S0705295.DOC