HomeMy WebLinkAboutStaff Report 7347
City of Palo Alto (ID # 7347)
Finance Committee Staff Report
Report Type: Action Items Meeting Date: 11/15/2016
City of Palo Alto Page 1
Summary Title: Development Services Cost of Services Study
Title: Development Services Cost of Services Study Including Fiscal Year 2017
Fee Proposals
From: City Manager
Lead Department: Development Services Department
Recommendation
Staff recommends that the Finance Committee recommend that the City Council adopt an
ordinance amending to Development Services Municipal Fees as described in Attachment A,
based on the completion of a Cost of Services Study (Attachment B) and adjusted by the annual
inflator applied to Municipal Fees from Fiscal Year 2016 to Fiscal Year 2017.
Executive Summary
The Development Services Department (DSD) undertook a Cost of Services Study in 2015 to
evaluate development related service fees incurred by applicants seeking a construction related
permit. These fees had not been reevaluated for many years, and the resulting
recommendations -- if approved -- would increase fee revenues and lower General Fund
subsidies consistent with the Cost Recovery Policy adopted by the City Council in May 2015.
The proposed changes would amend the fee schedule to reflect current International Code
Council (ICC) unit fee schedule structures and the City’s Green Building and Energy Ordinances
by eliminating some fees, proposing new fees, consolidating or expanding others, and adjusting
certain fees to a single flat-fee per permit. The City Council has the discretion to determine the
level of cost recovery for each of these fees. However, under State law, fees cannot be set
above the cost of service.
The consultant report is discussed in detail below, and the recommended fee changes
(Attachment A) and the full text of the consultant report (Attachment B) are attached. This
study was completed based on Fy2016 data, therefore an annual inflation value of 5.5%, as
recommended by the Office of Management and Budget for all Citywide fees in Fiscal Year
2017, is not included in the fees detailed in Attachment A but staff does recommend that this
increase be applied to all Development Services related fees in order to capture their cost in FY
2017 and included as part of the final ordinance action for City Council consideration.
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Background
In July 2010, the City Manager launched the comprehensive “Development Center Blueprint”
(Blueprint) project to restructure and adopt more holistic approaches to integrated
development review, permitting services, and staff coordination in order to improve
organizational efficiencies and minimize unnecessary costs and delays to customers. Since the
inception of the Blueprint, DSD has implemented new technologies, acquired additional space,
upgraded the existing space, and consolidated into a central department, that consists of
Building (formerly within the Planning department), Planning, Public Works, and Fire Prevention
divisions. Development Services is now a “one-stop” shop, located in a leased space across
from City Hall. Design development projects now have a single point of contact that facilitates
the customers’ experience throughout the permitting and construction process.
As part of the Fiscal Year 2014 Adopted Budget, and in efforts to better align the budget with
the current operational structure, the City Council created the Development Services
Department. Development Services embodies all development-related activities, including staff
allocations, resources, and associated service fees across multiple departments. The operating
budget currently relies on development review fees, permitting fees, and a subsidy from the
General Fund. Though the fees have been adjusted annually for inflation factors, it has been at
least five years since the fee schedule and structure were last subject to a full evaluation.
The Development Services Department is made up of key representatives from four different
departments including the Building, Planning, Public Works, and Fire divisions. These
representatives are physically stationed at the Development Center (285 Hamilton Avenue) or
elsewhere in the City, and provide development-related services to applicants seeking a
construction-related permit. In the current budget structure, representatives are allocated
proportionally to Development Services based on their time involved in the review process.
Approximately 80 employees are fully or fractionally budgeted to the department, resulting in a
total of 40 FTE. For example, Development Services has watershed protection representatives
in the Public Works department and transportation planners in the Planning department that
review building permits. In addition to personnel costs, Development Services has specific
overhead and indirect
charges such as the rent,
administrative functions,
and city support services
like Administrative Services,
City Attorney, and Human
Resources that must also
be accounted for. As a
department that operates
based on fee revenues, the
incoming fees must offset
all expenses which include
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personnel, overhead, and indirect charges.
On May 18, 2015 the City Council adopted the User Fee Recovery Level Policy (CMR 5735) that
suggests levels of cost recovery (high, medium, and low) based upon policy considerations. As
referenced in the table below, activities in which participants receive most or all of the benefit
from the service provided (i.e. issuance of building permits), or which are regulatory in nature,
fall within the “high” cost recovery level group.
The City retained the services of Capital Accounting Partners (CAP) to complete a cost of
services study to identify the total cost of providing services for which the City charges fees,
Phase I of which is included as Attachment D. CAP has prepared hundreds of cost allocation
plans for cities, counties and special districts throughout California, Texas, Washington and
more. Some of their clients include San Diego, Glendale, Los Gatos, Santa Barbara, Burbank and
Sacramento. Dan Edds is a project manager with CAP and has more than 15 years of experience
consulting within the public sector. His operational improvement work has involved problem
solving and process improvement opportunities for core business processes.
CAP uses an activity-based costing model to calculate the cost of a specific service (detailed
further in Attachment D), which identifies activities in an organization and assigns the cost of
each activity with resources to all services according to the consumption by each. The model
assigns direct and indirect costs to each fee, and therefore, calculates the cost of each fee at full
cost recovery. As discussed below, Phase I of the study includes recommendations for the
Department’s flat fees only.
Discussion
Fees and Fee Structure:
Development Services fees are structured in two ways: flat or project valuation-based. Based
on estimated FY 2016 revenues, approximately 75%, or $8.6 million, of departmental revenue is
derived from project valuation-based fees. Major project valuation-based fees include the
Building Permit and Plan Check fees. Industry practice correlates the valuation of a job to its
complexity, in the aggregate, and as such fees are calculated based on a percentage of a
projects valuation. Currently, the department uses the construction value for labor and
materials of the permitted work as the basis for determining the total Building Permit fee. An
additional Plan Check fee is assessed on top of the Building Permit, which is based on a
percentage of the total Permit fee. The Plan Check fee is intended to recover costs associated
with the Building, Fire & Life Safety, Zoning, and Public Works review of applicant plan
submittals. In contrast, flat rate fees are fees costed based on time and materials and activity
levels. These fees comprise the remaining Development Services revenue. The following
represents the projected breakdown of FY 2016 revenues evaluated as part of the fee study, at
current fee levels:
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FY 2016 Development Services Projected Revenue
Fee Study Project Steps and Process:
CAP was tasked to prepare a detailed cost analysis of its Development Services user fees with
the objective of ensuring that the Development Services Department is fully accounting for all
costs and recovering adequate revenues to cover expenses. Based on the current organizational
structure, CAP developed a costing model to analyze the total cost of fee generating services
and recommend adjustments necessary to reach full recovery.
As the study progressed, it was determined that additional data points were necessary to
recommend adjustments for valuation-based fee activities. Therefore, the report includes only
a high-level assessment of aggregated building permit and plan check activities. Staff is
currently in the process of implementing new data collection fields in the permit system and is
expanding the existing study to include a survey of other comparable City valuation tables and
alternative permit fee structures for what are currently valuation-based fees.
The study conducted by CAP for all Non-Valuation-based fees, or “flat rate” fees as referenced
earlier in this report, utilized an activity-based costing model to calculate the full cost of
providing specific services. This methodology identifies activities in an organization and assigns
the cost of each activity with resources to all services according to the consumption by each.
The model assigns direct and indirect costs to each fee, where all proposed fees have been
calculated at full recovery. A summary of how CAP builds cost structures follows:
1. Direct Costs
Through meetings with staff, CAP identified all direct staff time spent on fee-related activities
or services, where direct time is indicative of workers who are directly involved with activities
of a specific fee or service. Average salaries and the City Standard productive rate of 1,600
hours/year were used for these calculations. Additionally, CAP identified other operational
costs that are directly attributed to certain services, such as the Department’s use of on-call
consultants for inspections in the Building and Fire divisions.
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2. Indirect Costs (citywide administration)
These costs include processes that support, but do not directly apply to any specific activity or
fee, such as the Citywide and Departmental Overhead. The Citywide overhead costs are
allocated to departments based on the City’s Cost Allocation Plan. These represent expenses of
supporting departments including the offices of the City Manager, City Attorney, City Auditor,
City Clerk, Administrative Services, Human Resources, Information Technology, and Facilities
Maintenance.
3. Overhead (departmental administration)
Department Overhead is represented in two aspects: 1) Development Services as a whole; and
2) Divisional Overhead. Development Services overhead includes the salaries of the Director,
the Director’s Administrative Assistant, and the Senior Management Analyst, as well as rent,
and other supplies commonly used by all divisions of the department (Building, Planning, Public
Works, and Fire Prevention). These are not assigned to any particular service, but are allocated
to all fees since these professionals support all the activities of the department as a whole.
The Divisional Overhead represents costs associated with managers, supervisors, and support
staff and common purpose operational costs of the Public Works, Planning, and Fire
Departments. For example, direct staff is allocated as a percentage of an FTE to Development
Services based upon activity levels for Public Works, while divisional overhead which reflects
the Public Works administrative costs such as budget, contract, and executive leadership costs
are calculated as a rate that is applied to the salaries allocated to Development services and
executed through a year-end adjustment. The rate assumes that the same level of
administrative support provided to the Public Works Department is provided to the Public
Works division within Development Services. These are not assigned to any particular service,
but are allocated to all fees in the respective division.
4. Reserve
A reserve fund provides a mechanism to finance future unanticipated events and other
identified or planned needs of the department. For purposes of the calculation, the reserve
amount is allocated to all fees, similar to Overhead. As part of the study, the consultant
recommended that the City set a specific reserve policy, however included an optional common
practice to build 6-12 months of operating expenses over a three year period. The original
consultant study incorporates a $2.3 million reserve within the cost structure of the
department, where results show the full cost of fees with and without a reserve. However, due
to the recommended significant changes to move closer towards cost recovery, and the delay
necessary to adjust valuation-based fees, staff does not recommend the establishment of a
reserve at this time. As such, the proposed fees presented in Attachment A do not include any
assumption for reserve costs.
Projections:
The study indicates a total projected General Fund subsidy in FY 2016 of $1,787,985, excluding
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impacts of one-time activities, such as deferred revenue for large projects and expense savings.
Once adjusted for one-time revenues, the net general fund subsidy in FY 2016 is approximately
$294,000.
Drivers of Cost Recovery Variances:
Staff believes the following to be key drivers for cost recovery variances within the Public
Works, Planning, and Fire Prevention divisions:
1. Length of time since last comprehensive Fee Study. While fees have been adjusted annually
for inflation factors, it has been at least five years since the fee schedule and structure were last
subject to a full evaluation.
2. Fee levels in Planning, Public Works, and Fire have historically been set below full cost
recovery.
3. As part of the creation of Development Services, the cost structure for Planning, Public
Works, and Fire divisions has significantly changed. For example, divisions are now responsible
for overhead allocations such as rent, Development Services managerial staff, and other
commonly used operating expenses (e.g. scanning services, office supplies, etc.).
Findings & Recommendations:
Modifications to flat fees, representing approximately 25% or $2.7 million of departmental
revenues, are representative of current resources, activities, and activity levels, as well as
changes to California Building and Fire Codes, and/or state mandates. Recommended
modifications to fees included re-naming fees, altering tiered fees and triggers, removing, and
creating new fees. The proposed fees, including a description of changes where applicable, are
included as Attachment A (excluding the recommended 5.5% increase to align with FY 2017
costs).
Fire Prevention
The largest impact of the Fee Study is anticipated in the Fire Prevention Division. Fire
Prevention fees have historically been set below cost recovery, or were provided at no cost,
and a complete fee study or evaluation has not been completed in at least five years. Further,
as part of creating Development Services, all Fire Prevention staff and associated costs were
moved to Development Services offices resulting in the need for additional space. Moving Fire
Prevention entirely out of the Fire Department and into Development Services means that this
division is now subject to a different cost structure that includes overhead allocations such as
rent, Development Services managerial staff, and other commonly used operating expenses
(e.g. scanning services, office supplies, etc.).
All fees in Fire Prevention were calculated according to the consultant’s activity-based model,
where fees have been proposed at full cost based on current activities, activity levels, and
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proposed resources. These proposed fees are included in the fee study and are proposed to be
increased as recommended by CAP.
Public Works
Public Works, like Planning, has a host of fees. However, many of their fees can be applied to
both development and non-development-related work. The differentiating factor is that
development-related work is entirely the result of private development. For example, a
commercial developer has to apply for a street work permit to work in the right-of-way. That is
entirely due to the impacts associated with their project. That work is driven by private
interests and it has been the direction from Council to ensure that those fees are set at full cost
recovery. Those fees are collected by and reside in Development Services as do the subsequent
direct, indirect and overhead Public Works costs associated with providing those services.
For purposes of this study, private development work is separate and distinct from non-
development related work. Therefore, those services and fees are provided by Public Works as
a whole, and the fees are set by Public Works as a whole through the Public Works
departmental municipal fee schedule. Public Works, with direction from the City Council,
decides how close to full cost recovery they should set those fees. The CAP study did include
analysis of the Public Works Department, however, subsequent to the kick-off of the consultant
study, updated analysis on staff allocations, time estimates, and fee volumes were obtained
and staff was unable to incorporate this more current data into the consultant’s final results.
Therefore, Public Works municipal fee proposals included as part of the development of the
Adopted Fiscal Year 2017 Municipal Fee Schedule are reflective of a full cost recovery model,
however, were not reflective of the specific methodologies and assumptions used in the CAP
study. The FY 2017 Adopted Fees utilized the Questica Calculator launched by the Office of
Management and Budget as opposed to those fees recommended in the CAP study. The
Adopted amendments to Public Works’ fees in the Development Services Department
represent significant recommended increases from the 2016 fees, and are expected to bring
the Public Works fees much closer to cost recovery. As part of the FY 2018 budget process, the
Office of Management and Budget, Development Services and Public Works will review these
fees and ensure they are at full cost recovery and/or bring forward recommended adjustments
to the fees and appropriate based on FY 2017 actual activity levels and estimated FY 2018 costs.
Building
Non-valuation fees were updated to reflect current ICC unit fee schedule structures, per
California State code. Similar to Fire Prevention, a complete fee study or evaluation has not
been completed in the last five years, and all fees are proposed at full cost according to the
consultant’s activity based model and current activities, activity levels, and resources.
The most significant changes recommended within the Building division are a result of
restructuring Mechanical, Plumbing, and Electric Permit fees. These fees are charged in
conjunction with the Building Permit and generally charge a Base Fee (representing
administrative costs to process) and new or remodeled supplemental fee (based on square
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footage and representative of inspection costs). As a result of the study, current processing and
inspection times have both decreased. At full cost, the base fee is proposed to decrease to $82,
from $92, and the square footage fee to decrease to $0.02, from $0.11 per square foot.
Mechanical, Plumbing, and Electric fees can also be charged as stand-alone permits. These fees
are structured as a Base fee (representing administrative costs to process) plus a supplemental
permit fee (representing inspection costs). The base fee is proposed to decrease to $82 from
$92 as stated above, where the unit of measure for the supplemental permit is proposed to
change from “each” to “per permit”. The current unit of measure is reflective of time estimates
for each incremental measure of an activity, such as the inspection of each individual light
fixture or switch at $0.50/each. Determining the incremental unit of time is incredibly difficult,
hard to justify, and is no longer a method promoted by ICC. As such, Development Services has
revised these fees on a per permit basis, using time estimates of an average project (5,000 sq.
ft.). In the case of the light fixture, the permit would be issued at a total cost of $82 for the
Base Fee, representing administrative processing costs, plus $68 for the inspection of any
number of light fixtures.
Green Building
Development Services continues to expand and develop the Green Building program in efforts
to follow the City Council’s lead and maintain a leadership role in environmental sustainability.
Fees were updated and new fees implemented to comply with State mandates, such as a
Landscape review and permit management, as well as the current Green Building and Energy
Ordinance. The cost structure of these fees includes consulting services associated with the
integration and management of sustainable building practices and policies, Landscape review
and permit management, as well as staff training, quality control, reporting, and informational
outreach to the community.
Use & Occupancy
Use & Occupancy fees were included in the study; however, staff does not propose to adjust
these fees at this time. These fees will be studied separately with the integration of the
Business Registry fee where staff anticipates that drivers to calculate cost, such as activities and
resources, will change as the program is developed.
Next Steps:
Development Services strives to operate as a revenue-supported department within the
General Fund with the ultimate goal of being an enterprise fund. The ultimate goal of
Development Services is to reach full cost recovery in all divisions and the adoption of the Fees
outlined in Attachment A represents the next step towards this goal of full cost recovery.
The department will continue to track revenues and expenditures at a divisional level through
Fiscal Year 2017 in order to analyze their cost-recovery performance and will work
collaboratively with the Office of Management and Budget, and the City Attorney’s Office to
identify and define a reserve policy that is appropriate and specific to the Development
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Services. Staff anticipates returning to City Council with iterative recommendations, including
adjustments to valuation-based fees and the inclusion of reserve costs, through subsequent
budget processes.
Resource Impact
The actions recommended in this report would increase the estimated revenue generated by
the Development Service Department flat fee activities. Given the changing economic
environment and the unknown potential impacts of the increases on activity levels (estimated
to be minor), no adjustment to the budget is assumed. Revenue collections will be monitored
and factored into the annual development of the budget as data is availabe and adjustments
are found to be necessary.
Environmental Review
Adoption of an ordinance amending Development Services Municipal Fees is not a project for
the purposes of the California Environmental Quality Act (CEQA) and therefore no
environmental review is necessary.
Attachments:
Attachment A_Municipal Fee Proposals (PDF)
Attachment B_CAP Cost of Services Study (PDF)
FY 2016 Fee Proposed Fee Total
Surcharge/(Subsidy)Notes
Administration
Business Registry
Business Registry Fee $50.00 per business $50.00 per business No Change Business Registry fees
studied separately
Building
Building Permit Fees
A. $1.00 - $1,000.00 $69.20 base fee
B. $1,000.01 - $2,000.00 $69.20 for the first $1,000.00 plus $5.47 for each additional
$100.00 or fraction thereof, to and including $2,000.00
C. $2,000.01 - $25,000.00 $123.91 for the first $2,000.00 plus $25.03 for each additional
$1,000.00 or fraction thereof, to and including
$25,000.00
D. $25,000.01 - $50,000.00 $699.59 for the first $25,000.00 plus $18.58 for each additional $1,000.00 or fraction thereof, to and including
$50,000.00
E. $50,000.01 - $100,000.00 $1,163.98 for the first $50,000.00 plus $12.50 for each additional
$1,000.00 or fraction thereof, to and including
$100,000.00
F. $100,000.01 - $500,000.00 $1,789.20 for the first $100,000.00 plus $10.03 for each additional
$1,000.00 or fraction thereof, to and including
$500,000.00
G. $500,000.01 - $1,000,000.00 $5,800.59 for the first $500,000.00 plus $8.52 for each additional
$1,000.00 or fraction thereof, to and including
$1,000,000.00
H. $1,000,000.01 and Up
$10,058.55 for the first $1,000,000.00 plus $6.72 for each additional
$1,000.00 or fraction thereof
If valuation exceeds $5,000,000.00, an alternative fee arrangement
may be established by the Chief Building Official to achieve full cost
recovery
I. Building Demolition Permit $320.00 (does not include C&D fees)$386 ($66)
J. Commercial Interior Non-Structural Demolition Permit $194.00 (does not include C&D fees)$175 $19
Construction & Demolition
Commercial and Multi-Family Projects greater than or equal to $25,000.00 in Valuation1 $238.00 per permit $369 ($131)
Single Family and Two Family Projects greater than
$25,000.00 and less than $75,000.00 in Valuations1 $80.00 per permit $154 ($74)
Single Family and Two Family Projects greater than
$75,000.00 in Valuation1 $212.00 per permit $225 ($13)
Electrical Permits
Base Fee $92.00 per permit $82 $10
New or Remodeled Square Footage $0.11 per square foot $0.02 $0.09
Air Conditioners $29.00 per unit $81 ($52)
Air Cooled or Oil Cooled Lighting and/or Power Transformer Each KVA shall be considered as one horsepower and charged for
as per motor schedule Delete Not actively charged
Conditional Utility Agreement $252.00 each $237 $15
Busway, Power Duct, or Floor Duct Per Foot $0.50 each $68
Each Additional Meter $5.00 each $68
Fixtures, Switches, and Outlets $1.00 each $68
Lighting, Power and/or Control Panel Board, Switchboard Cabinet or Panel $5.00 each $68
Motor $23.00 each $68
Motor Generator $3.00 per KVA $68
Range, Electric Clothes Dryer, or Water Heater $5.00 each $68
Special Circuit (Not Listed Herein)$5.00 each $68
Service Conductor/Switch - Greater than 800 ampre $40.00 each $243 ($203)
Service Conductor/Switch - Less than 200 ampre $18.00 each $122 ($104)
Service Conductor/Switch - Less than 800 ampre $29.00 each $162 ($133)
Temporary Power Pole $56.00 each $68 ($12)
Temporary Wiring for Construction $56.00 each $68 ($12)
Electrical Permits - Electrical Vehicle Charging Stations
Commercial (Level 1 and 2)$370.00 $382 ($12)
plus $92.50 for each additional station $74 $18
Commercial (Level 3 and 4)$560.00 $464 $96
plus $140.00 for each additional station $91 $49
Residential (All Types)$160.00 per station Delete
Residential (Level 1 and 2)$168 Add
Residential (Level 3)$236 Add
DEVELOPMENT SERVICES
No change to Valuation Table DSD to complete
separate study
Restructured to a single
flat-fee per permit
Converted to a multi-level
fee.
Attachment A
FY 2016 Fee Proposed Fee Total
Surcharge/(Subsidy)Notes
Electrical Permits - Photovoltaic Systems
Residential System $311.00 each Delete
Residential Systems (less than 10kW)$81 Add
Residential Systems (greater than 10kW)$304 Add
Commercial System (less than 10 kW)$565.00 each $537 $28
Commercial System (10kW - 49kW)$850.00 each $805 $45
Commercial System (greater than 49kW)$900.00 each $873 $27
General & Miscellaneous Fees
Address Change $224.00 single address; $356 ($132)
$112.00 each additional address $171 ($59)
All Other Publications $16.00 each No Change
Construction/Maintenance Vehicles $76.00 per space per week No Change
Electric Service and Safety Inspection $84.00 per hour $151 ($67)
Extension of Building Permit or Building Permit Application $56.00 per application $86 ($30)
Inspections and Investigations - Outside Normal Business Hours
Note: Inspections and investigations outside normal business hours (2- hour minimum).$202.00 per 1.5x OT hour; $365 ($163)
$226.00 per 2.0x OT hour $486 ($260)
Inspections and Investigations - Unclassified
Note: Inspections and investigations for which no fee is specifically indicated (2-hour minimum).$163.00 per hour $228 ($65)
Reactivation of Expired Building Permit $168.00 per permit plus Plan Check Fees as applicable $189 ($21)
Reactivation of Expired Building Permit - All Others 50% of original Building Permit Fee not to exceed the full cost to
perform remaining inspections as determined by the Chief Building
Official
No Change
Reactivation of Expired Building Permit - Final Inspection Only $375.00 or 50% of original Building Permit Fee, whichever is less $253 $122
Real Property Research Fee (1-hour minimum)$127.00 per hour $243 ($116)
Records Retention $4.00 per plan sheet $6 ($2)
Reinspection Fee - Multi-Family Residential and Non- Residential $308.00 each $281 $27
Reinspection Fee - Single Family Residential $84.00 each secondary inspection type;$220 ($136)
$308.00 each primary inspection type $281 $27
Request for Release of Building Plans $45.00 each $76 ($31)
Residential Inspection GuidelinesNote: Available free online $33.00 each No Change
Green Building
Residential - Single Family and Two Family New Construction1
Note: New construction plus additions greater than 1,250 sq. ft. and rebuilds.$677.00 per review Delete
New Single Family $1,373 Add
Residential - Existing Home Renovations, Rebuilds, and/or Additions
Note: Any existing home renovation, rebuilds, and/or additions greater than 250 sq. ft. and less than
1,250 sq. ft. and/or greater than
$100,000.00 valuation.
$56.00 per review Delete
Residential - Multi-Family Renovations or Alterations
Note: Renovations or alterations greater than 50% of the existing unit sq. ft. and that include
replacement or alteration of at least of the following: HVAC system, building envelope, hot water system,
or lighting system.
$1,190.00 per review Delete
Alterations and additions for single and multifamily < 1,000 sq ft and increases conditioned
space $1,097 Add
Alterations and additions for single and multifamily > 1,000 sq ft $1,232 Add
Residential - Multi-Family New Construction of Three or More Units (attached)$1,190.00 (1-10 units); $1,388.00 (11-24 units); $1,687.00 (25 units
or more)Delete
Multi Family New Construction of 3 or More (attached) Units $1,508 Add
Multi Family New Construction of < 4 $1,238 Add
Non-Residential - New Construction1
Note: New construction plus additions greater than 1,000 sq. ft. and rebuilds.$1,495.00 per review Delete
New commercial 1000 - 25,000 SF $1,778 Add
New commercial 25,001-50,000 SF $2,048 Add
New commercial >50,000 SF $2,183 Add
Non-Residential - Tenant Improvements, Renovations, or Alterations (greater than 5,000 sq.
ft)
Note: Any existing tenant improvement, renovation, rebuilds, and/or additions greater than 5,000 sq. ft.
that include replacement or alteration of at least two of the following: HVAC system, building envelope,
hot water system, or lighting system.
$976.00 per review Delete
Tenant improvements, renovations, or alterations > 5,000 sq ft
Note: includes replacement or alteration of at least two of the following: HVAC system, building envelope,
hot water system, or lighting system and project value greater than $200,000.$1,508 Add
Tenant improvements, renovations or alterations > $200,000 in valuation (and not triggered
by a Calgreen Tier) $1,238 Add
Non-Residential - Tenant Improvements, Renovations, or Alterations (greater than $100,000
valuation)
Note: Any existing tenant improvement, renovation, or alterations greater than $100,000.00 in valuation
and/or landscape renovations 21,000 sq. ft.
$357.00 per review Delete
If the project is over $100,000 Energy Star is required after 12 months of occupancy $698 Add
Landscape Plan Review - Single Family Residential $894 NEW
Landscape Plan Review - Non-Residential & Multi-Family $1,453 NEW
Landscape Inspection $218 NEW
Converted to a multi-level
fee.
Green Building Fees have been updated in
accordance with the current Green Building and
Energy Ordinance.
Necessary to provide
services and compliance
with the Emergency
Building Standards for
Outdoor Potable Water
FY 2016 Fee Proposed Fee Total
Surcharge/(Subsidy)Notes
Mechanical Permits
Base Fee $92.00 per permit $82 $10
New or Remodeled Square Footage $0.11 per square foot $0.02 $0.09
Flue $5.00 each Delete
Furnace and Flue $28.00 each Delete
Furance, Flue, and Associated Ducts $163 Add
Boiler (Certified Design)$28.00 each Delete
Boilers, Compressors, and Absoprtion Systems:
For the installation or relocation of each boiler or compresor up to 30 hp, or each
absopration system up to and including 1,000,000 Btu/h $109 Add
For the installation or relocation of each boiler or compressor exceeding 30 hp, or each
absorption system exceeding 1,000,000 Btu/h $163 Add
Air Conditioner or Heat Pump $28.00 each Delete
Duct Outlet $0.50 each Delete
Air Handlers up to and including 10,000 cfm $54 Add
Exhaust Hood - Kitchen or Industrial $28.00 each Delete
Vent Fan (Bath, Dryer, Residential Kitchen)$11.00 each Delete
Ventilation and Exhaust $54 Add
Fire Damper $5.00 each Delete
Miscellaneous
For each appliance or piece of equipment regulated by this code, but not classed in other appliance
categories, or for which no other fee is listed
$54 Add
Process Piping System $28.00 each $54 ($26)
Process Piping System - Hazardous $56.00 each $130 ($74)
Swimming Pool Heater $28.00 each $65 ($37)
Evaporative Cooler $28.00 each Delete Not actively charged
Plan Review Fees
Additional Plan Review
Note: Required by changes, additions, or revisions to plans including Alternative Means and Methods (2-
hour minimum). For Elective (3rd party) and over-the-counter reviews (half hour minimum).$191.00 per hour $201 ($10)
Certified Access Specialist (CASp) Review/Consultation Actual cost of CASp Consultant plus 15%$262
Building Plan Check 80% of Building Permit fee
Elective Plan Check 35% of Building Plan Check fee
Fire and Life Safety Plan Check 45% of Building Permit fee
Public Works Plan Check 12% of Building Permit fee
Zoning Plan Check 30% of Building Permit fee
Plumbing Permits
Base Fee $92.00 per permit $82 $10
New or Remodeled Square Footage $0.11 per square foot $0.02 $0.09
Plumbing Fixtures $3.00 each Delete
Plumbing Fixtures:
For each plumbing fixture on one trap or a set of fixtures on one trap (including water, drainage piping,
and backflow protection therefore)$81 Add
Commercial/Industrial Sewer $28.00 each Delete
Residential Sewer $11.00 each Delete
Plumbing Fixtures:
For each building sewer $130 Add
Rain Water System $5.00 each Delete
Rain Water Systems $81 Add
Water Heater $5.00 each Delete
Water Heater, Vent, or Other $97 Add
Gas Outlet $5.00 each Delete
Radiant Heat Piping System $28.00 each Delete
Gas Piping System $195 Add
Industrial Waste System $28.00 each Delete
Industrial Waste Pretreatment Interceptor
(including trap and vent, except kitchen-type grease interceptors functioninga fixture traps)$195 Add
Water Piping System or Repair $5.00 each Delete
Water Piping
Installation, alteration or repair of water piping, water treatment equipment or both.$97 Add
Solar Hot Water System
Note: Does not include Plan Check fee.$224.00 each $195 $29
Storm Drain System $28.00 each $195 ($167)
Swimming Pool $28.00 each $65 ($37)
Atmospheric-type Vaccume Breakers $97 New
Backflow protective device other than atmospheric-type $195 New
Medical Gas Piping Systems $195 New
Plumbing Permits - Graywater Systems
Clotheswasher System $56.00 each $81 ($25)
Complex System $88.00 plus plan review at cost $195 ($107)
Simple System $61.00 plus plan review at cost $81 ($20)
Restructured to a single
flat-fee per permit and re-
named to be consistent
with ICC permit fee tables
Reflective of curent ICC
tables and activities for which no other fee
currently exists.
Plumbing Fees have been updated to reflect
current ICC table 114.1 unit fee schedule
structure, per California state plumbing code.
Mechanical Fees have been updated to reflect
current ICC table 114.1 unit fee schedule
structure, per California state mechanical code.
Restructured to a single
flat-fee per permit and re-
named to be consistent
with ICC permit fee tables
No Change to Plan Check
Permit Fees
FY 2016 Fee Proposed Fee Total
Surcharge/(Subsidy)Notes
SB 1473 Fee
A. $1.00 - $25,000.00 Permit Valuation $1.00 per valuation increment
B. $25,001.00 - $50,000.00 Permit Valuation $2.00 per valuation increment
C. $50,001.00 - $75,000.00 Permit Valuation $3.00 per valuation increment
D. $75,001.00 - $100,000.00 Permit Valuation $4.00 per valuation increment
E. Each $25,000.00 Increment or Fraction Thereof Above
$100,000.00 Add $1.00 per valuation increment
F. Minimum $1.00 minimum
Strong Motion Instrument Program
Commercial $28.00 per $100,000.00 permit valuation ($0.50 minimum)
Residential $13.00 per $100,000.00 permit valuation ($0.50 minimum)
Use & Occupancy Permits
Certificate of Use and Occupancy $287.00 each
Certificate of Use and Occupancy - Replacement $123.00 each
SB 1186 Mandated FeeNote: Does not include fees collected by the Fire Department.$1.00 each No Change State mandated
Temporary Occupancy Permit - Multi-Family Residential, Non-Residential, and Other
Commercial $896.00 each $602 $294
Temporary Occupancy Permit - Single Family Residential and Commercial Tenant
Improvement less than 10,000 sq. ft.$375.00 each $445 ($70)
Fire Prevention
Compliance Fees
Emergency Response Fee - Hazmat (PAMC 17.24.050)Up to $1,212.00 for each incident up to 100% cost recovery No Change
Installation or Closure Without Approved Plans and/or Permits $275.00 - $813.00 average fee range No Change
Documents
Emergency Planning Guide $253.00 each No Change
Long-term Offsite Document Storage $0.25 per page No Change
Microfilm Copy/Print $3.25 per blueprint page; $0.30 per specification/ calculation page No Change
Photographs $30.00 first print; $0.55 each additional print No Change
Hazardous Materials Classification Permits
Compressed Gas $139.00 annually $350 ($211)
Corrosives $139.00 annually $350 ($211)
Cryogenic Fluid $139.00 annually $350 ($211)
Flammable and Combustible Liquids $139.00 annually $350 ($211)
Flammable Gas $139.00 annually $350 ($211)
Flammable Solids $139.00 annually $350 ($211)
Health Hazard (Liquids & Solids)$139.00 annually $350 ($211)
Liquefied Petroleum Gases $139.00 annually $350 ($211)
Organic Coatings $175.00 annually $350 ($211)
Organic Peroxides $139.00 annually $350 ($211)
Ovens - Industrial Baking or Drying $102.00 annually $350 ($211)
Oxidizers (Liquids & Solids)$139.00 annually $350 ($211)
Oxidizing Gas $139.00 annually $350 ($211)
Pyrophoric Gas $139.00 annually $350 ($211)
Pyrophoric Materials (Liquids & Solids)$139.00 annually $350 ($211)
Pyrotechnical Special Effects Material $29.00 annually $350 ($211)
Radioactive Materials $139.00 annually $350 ($211)
Refrigeration Equipment $175.00 annually $350 ($211)
Spraying/Dipping $175.00 annually $350 ($211)
Toxic, Highly Toxic, Moderately Toxic, Health Hazard Gas
Note: Includes pesticides, fumigants, and etiologic agents.$139.00 annually $350 ($211)
Toxic, Highly Toxic, Moderately Toxic, Health Hazard Materials $139.00 annually $350 ($211)
Unstable Reactive Gas $139.00 annually $350 ($211)
Unstable Reactive Materials (Liquids & Solids)$139.00 annually $350 ($211)
Water Reactive Materials (Liquids & Solids)$139.00 annually $350 ($211)
Other Hazardous Materials - Unclassified
Note: Inspections and investigations for which no fee is specifically indicated (1-hour maximum).$350 NEW
General category to
include other hazardous materials not listed above
Tire Recapping/Tire Storage $575.00 annually $1,396 ($821)
No Change
These will be studied
separately, with the
integration of the Business Registry fee.
No Change State mandated
No Change State mandated
FY 2016 Fee Proposed Fee Total
Surcharge/(Subsidy)Notes
Hazardous Materials Storage Permits
Additional Approvals for Hazardous Materials Storage Permit Note: Additional approval for
permit to construct, temporary closure, permanent closure, otherwise modify a hazardous materials storage facility. See CEQA for additional fees.$356.00 per occurrence, plus $758 ($402)
$159.00 per hour for time above two hours $496 ($140)
Business Plan (HMBP)$256.00 per location annually $496 ($240)
Late Fee for Hazardous Materials Storage Permit 25% of total Hazerdous Material permit fee No Change
Level I Facility (Includes 1 hr of Inspection Time)
Note: Minimal storage as defined by having no hazardous materials over CFC permit amounts as
specified in CFC section 105.
$264.00 annually per location $350 ($86)
Level II Facility (Includes 2 hrs of Inspection Time)
Note: Quantities exceeding CFC permit threshold, but less than 50 gal., 500lbs or 200 cu. ft. Category
also includes dry cleaning, fixed medical gas, auto or aircraft repair, and service stations.
$404.00 annually per location plus other hazardous materials
classification permit if applicable $700 ($296)
Level III Facility (Includes 4 hours of Inspection Time)
Note: Quantities exceed 50 gal. 500lbs, or 200 cu. ft. and not categorized as Level II.$729.00 annually per location plus other hazardous materials classification permit if applicable $1,399 ($670)
Petroleum Aboveground Storage Tank (Includes 2hrs of Inspection Time)$593.00 annually $700 ($107)
Provisional/6 Month (Includes 2 hrs of Inspection Time)$186.00 plus other hazardous materials classification permit fees if
applicable $700 ($514)
Inspection Fees
Additional Inspection or Resinspection Fee $323.00 for up to 2 hours resinspection, plus $698 ($375)
$159.00 per hour (during business hours)$349 ($190)
After Hours Inspection Fee
Note: Fee for before or after normal business hours; weekends and holidays included. Fee is to be paid
in advance of inspection.
$165.00 per hour; 4 hour minimum $523 ($358)
Care Facility
Note: Includes community, child day care and residential care for the elderly (CFC 111.4). Excludes
residential elderly care facilities with six or fewer persons.$175.00 annually Delete Not actively charged
Care Facility Inspection Including Fire Clearance $73.00 for facilities with 7-14 clients; $349 ($276)
$140.00 for facilities with more than 14 clients $698 ($558)
Christmas Tree Lot/Pumpkin Patch $175.00 each $349 ($174)
$713.00 annually for up to 4 hours; plus $1,454 ($741)
$159.00 for each additional hour $349 ($190)
Outside Cooking Booths $198.00 each $523 ($325)
Standby Fire Watch (Per Person)$159.00 per hour $349 ($190)
Use and Occupancy Fire Inspection
$148.00 per inspection No Change
To be studied separately,
with the integration of the Business Registry fee
As-Built Plan Check and Additional Work
$698 New
Implemented to recover
costs for activity in which
no other permit currently
exists
Consultations
Additional Hours Over Plan Review/Inspection $155.00 each $276 ($121)Changing to a Per Hour
fee
Alternate Means and Methods Application (2 hr Maximum)$356.00 per application $657 ($301)
Appeals to Decisions $159.00 per hour $349 ($190)
Consultation Fee $166.00 per hour $349 ($183)
Hazardous Materials Data Entry Fee $77.00 per hour; 1 hour minimum Delete Not actively charged
Hydrant Flow Fee $165.00 per occurrence $349 ($184)
Prior Fee Range was 7-
25 clients & 25+
High Rise Building - Certificate of Compliance
Note: Certificate of compliance inspection for each high rise building which is required by state law to be inspected and certified annually as meeting minimum compliance with applicable state of California fire
and life safety standards for existing high rise buildings (CFC 111.4.3).
FY 2016 Fee Proposed Fee Total
Surcharge/(Subsidy)Notes
Life Safety & Fire Protection
Automatic Fire Sprinkler Installation/Modification:
1-19 Sprinkler Heads $356.00 $698 ($342)
19+ Sprinkler Heads (Includes Hydrostatic Test), plus additional per head fee $1,541
plus $1.80 per head $3 ($2)
Express Fire Protection Plan Check Fee $163.00 per occurrence No Change
Fire Alarm System Installation and Modification $356.00 plus $974 ($618)
$2.00 a device or contact point $21 ($19)
Fire and Life Safety Plan Check - Commercial
Note: Includes one inspection and reinspection.The Fire and Life Safety Plan Review Fee is 45% of the Building
Plan Check Fee and is collected by the Building Division at the time
an application of a Building Permit is submitted
No Change
Fire Protection and Fire Access Plan Review for New Single Family Dwellings or Additions $100.00 each $800 ($700)
Underground Fire Service Line
Note: Includes 4 hrs of Inspection & 1 hr of Plan Check $356.00 per occurrence $1,672 ($1,316)
Previously included one
inspection and one
reinspection
Hydrant/Appliance Installation or Modification $261.00 Delete
plus $59.00 per hydrant $174 ($115)
Other Automatic Fire Extinguishing System
Note: Includes hood and duct, FM 200, Inergen, and C02. If a system has a release panel, Fire Alarm
fees apply as well.$356.00 plus $7.25 per nozzle $974 ($618)
Site Disaster Planning $166.00 per hour $349 ($183)
Standpipe System - Wet, Dry, or Combination $208.00 per riser $698 ($490)
Temporary Certificate of Occupancy
$356.00 per occurrence No Change
To be studied separately,
with the integration of the
Business Registry fee.
Verification of Fire Protection System Maintenance and Certification $89.00 annually $78 $11
Food truck permits
$174 New
Implemented to recover
costs for activity in which
no other permit currently
exists
Multifamily dwellings, hotels & motels
4-50 units $349 New
51-100 units $698 New
Greater than 100 units $1,047 New
Fire Prevention Inspection of Private Schools $698 New
Specific Hazard Permits
Aerosol Products $102.00 annually $436 ($334)
Amusement Buildings $410.00 each $0 Delete Not actively charged
Automobile Wrecking Yard or Junk Yard $179.00 annually $0 Delete Not actively charged
Bowling Alley and Pin Refinishing Involving the use of Flammable Liquids $179.00 each $1,018 ($839)
Candles and Open Flames in Assembly Areas $142.00 annually $349 ($207)
Carnivals and Fairs $179.00 each $1,454 ($1,275)
Cellulose Nitrate Storage/Nitrate Film $102.00 annually $102 $0
Combustible Fiber/Material Storage $179.00 annually Delete Not actively charged
Confined Space $148.00 annually Delete Not actively charged
Dust Producing Devices $126.00 annually Delete Not actively charged
Excavate within 10 ft. of Flammable or Combustible Pipeline $88.00 each Delete Not actively charged
Explosive or Blasting Agents $102.00 annually Delete Not actively charged
Fireworks Display $565.00 each Delete Not actively charged
High-piled Combustible Storage $102.00 annually Delete Not actively charged
Hot Work (Welding) Operations $179.00 annually $349 ($170)Changing to a one-time
fee
Liquid or Gas-Fueled Powered Equipment/Generator $88.00 each $349 ($261)
Liquid or Gas-Fueled Vehicles or Equipment in Assembly Buildings $103.00 each Delete Not actively charged
Magnesium Working $103.00 annually Delete Not actively charged
Malls - Covered $103.00 annually $698 ($595)
Occupant Load Increase - Temporary Assembly $236.00 each $349 ($113)
Open Burning $236.00 each $349 ($113)
Open Flame/Flame Producing Devices $88.00 each $349 ($261)
Operate a Tank Vehicle to Transport Flammable/Combustible Liquids $102.00 annually $494 ($392)Changing to a per-vehicle
fee
Parade Float $115.00 per hour $350 ($211)
Place of Assembly $236.00 per occurrence $700 ($464)
Place of Public Assembly - Temporary $236.00 each $349 ($113)
Special Events Permit
$349 New
Implemented to recover
costs for activity in which
no other permit currently
exists
Tent or Air Supported Structure
Note: Tent or air-supported structure having an area in excess of 200 sq. ft. or canopies in excess of 400
sq. ft. Fee includes a public assembly permit of $125.00 for all tents.
$290.00 each $741 ($451)
Restructuring to a two-tier
fee
Restructuring to one per-
device fee to be charged
in conjunction with the
Underground Fire Service Line fee.
New Fee and Fee
Ranges implemented per
State mandate to inspect
these facilities
Capital Accounting Partners Page 1
Report – Development Services Fee Study
June 2016
CITY OF PALO
ALTO
Development Services
Department
CAPITAL ACCOUNTING PARTNERS, LLC
Daniel B Edds, MBA, PMP
3570 Buena Vista Dr.
Sacramento, Ca 95864
916.670.0001
danedds@mycapartner.com
Attachment B
Capital Accounting Partners Page 2
Contents
Development Services Department ........................................................................................................................... 3
Introduction and Scope ................................................................................................................................... 3
Summary of Costing Methodologies ............................................................................................................... 3
Assuring Quality Results .................................................................................................................................. 6
Quantitative ............................................................................................................................................. 6
Qualitative ................................................................................................................................................ 6
Summary of Results ................................................................................................................................................ 8
General Observations of Cost Recovery and Pricing ....................................................................................... 8
Valuation Based Fees ............................................................................................................................... 8
Modifications to the Fee Schedule ........................................................................................................... 9
Results ............................................................................................................................................................. 9
Projecting Revenues ................................................................................................................................. 9
Challenges to Accurately Projecting Revenues .......................................................................................10
Reasons Revenues Can Fail to Meet Expenses .......................................................................................10
Summary of Results by Division or Work Unit ...............................................................................................11
Why Differences in Recovery Levels? .....................................................................................................11
Observations and Recommendations ......................................................................................................................13
General Observations and Recommendations .......................................................................................13
What is Not Covered in this Analysis ......................................................................................................13
Assessing Valuation Based Fees .............................................................................................................13
Adjusting the Fee Schedule ....................................................................................................................13
Building Reserves ...................................................................................................................................14
Development Services Fee Table ……………………………………………………………………………………………………………… 15
Capital Accounting Partners Page 3
Development Services Department
The City’s Development Services Department is comprised of four divisions or functions:
1. Building;
2. Fire prevention;
3. Planning; and
4. Public works.
Together, they form a valuable resource for home owners, businesses, contractors, developers, and
citizens to build safe buildings that comply with the code requirements of the City. The long term
objective of the Department is to become an enterprise fund. Financially, this means that fees for its
various services must be sufficient to recover the cost of the Department.
Introduction and Scope
As part of its effort to manage its financial resources wisely, the City of Palo Alto engaged Capital
Accounting Partners to prepare a detailed cost analysis of its Development Services user fees. The City's
objectives for the study were to ensure that the Development Services Department is fully accounting
for all of its costs and recovering adequate revenues to cover its expenses.
The scope of this study included the following:
Review and update the fee schedule;
Calculate the total cost of fee generating services;
Calculate the cost of plan check and inspection services from valuation based fees;
Analyze cost recovery level;
Develop a cost model based on the current organizational structure;
Reviewing the results with staff; and
Provide recommendations or methodologies on how to adjust fees annually.
Summary of Costing Methodologies
Driver Based Costing Models
Developing driver based costing models is a detailed and robust method of calculating the cost of a
specific service. It is based on the principles of activity based costing so it seeks to understand cost at an
operational level. This means it relies on understanding the time staff invests in core business processes
to provide fee and non-fee services. This provides the ability to understand staff time and cost as each
Capital Accounting Partners Page 4
staff position participates in providing fee services. Graphically, the following figure illustrates this
methodology.
Hypothetical Illustration of a Driver Based Costing Model
Contributing Staff Process Steps Fee
Project Managers
Permit Intake
Plan Reviewer
Building Inspector
Chief Building Official
Plan Review
Inspection
7500 SF SFR
Zoning Code Review
Project Steps and Process
Step 1: Collect Data – This first step involves discussions with staff to identify those positions within the
department that provide and support direct services. It also involves collecting departmental budget and
expenditure data, identifying the salary and benefits for each position, and identifying non-personnel
expenditures, as well as any departmental and City wide overhead. Specifically, the steps involve the
following:
Identifying staff positions – This includes identifying both position titles and names.
Calculating the number of productive hours – For each position, vacation time, sick leave, paid
holidays, professional development (training), routine staff meetings, and daily work breaks are
deducted from the standard 2,080 annual hours. The result is a range of hours available for each
position on an annual basis. This range is typically 1,500 to 1,600 hours. Factors that influence
this range are length of service with the jurisdiction and local policies for holiday and personal
leave time. However, based on previous work with the City where the calculated number of
productive hours was almost exactly 1600 hours, and at the request of the Office of
Management and Finance, we set all positions at 1600 productive hours.
Identifying and allocating non-personnel costs – Costs for materials and supplies are allocated
to the salary and benefits for each position.
Capital Accounting Partners Page 5
Assigning any other expenses that are budgeted in other areas – There are often expenses that
should be included with the total cost of services. Examples of such costs might include
amortized capital expenses for vehicles and technology.
Identifying core business processes or activities – This step also involves discussions with staff
to understand, at an operational level, the work of the operating unit. Core business processes
used to provide services are identified and then defined by the tasks that are involved.
Processes are also organized by direct and indirect categories:
Direct processes and activities – Those processes that directly contribute to the processing of
an application or permit are first identified. Examples of a direct activity are building inspection,
application intake, and pre-application review.
Indirect processes and activities – Those processes that support, but do not directly apply to the
processing of a specific application or permit. An example of an indirect activity is customer
service or staff training to maintain certifications.
Step 2: Building cost structures – This second step involves significant interaction with staff and the
development of time estimates for both direct and indirect processes in each department. Specifically,
this step is at the core of the analysis. There are four processes that comprise this step:
Gathering time estimates for direct processes – By interviewing staff in individual and group
meetings, an estimate of time was assigned to each service by the process that is indicated. For the
most part, the processes included three primary steps:
Permit intake;
Plan review; and
Construction inspections.
In this analysis, staff time is estimated and assigned to each step. The sum of all the process steps is
the total time that is required to provide that specific service.
Assigning indirect and annual process time – An annual time estimate is gathered from staff for
those indirect or support processes in which they are involved. These may include activities such as
program administration, customer service, and department administration. These costs are
allocated to all services proportionately to all services provided by the department.
Calculating fully loaded hourly rates and the cost of service – Once the total time for each direct
and indirect service is estimated, the cost of service is calculated by using the fully loaded hourly
rates for each staff member or position that is involved with the service. The fully loaded hourly
rate for each employee is based on the employee's salary and benefit costs plus a share of non-
personnel and City overhead costs divided by the employee's available work hours (i.e. 2,080 hours
minus all leave hours). Thus, the direct and indirect cost by activity also includes departmental and
citywide overhead as well as non-labor costs. The source of City indirect costs and non-personnel
costs is from the annual budget or cost allocation that has been established by the City.
Gathering activity or volume data – A critical element in the analysis is the number of times a given
service is provided on an annual basis. This is critical data for three reasons:
It allows a calculated projection of current revenue based on current prices. This is compared
with actual revenue to see if there is a close match as the data should match.
Capital Accounting Partners Page 6
It allows for a calculated projection of revenue at full cost. This is compared to actual
expenditures to see if there is a close match as the data should match.
It allows for a calculation of total hours consumed. Hours consumed must closely match actual
hours available.
If any of the three calculations do not approximate actual numbers, then time estimates and/or volume
data need to be re-evaluated. These are critical quality checks for costing accuracy.
Step 3: Calculating the full cost of services – This third step calculates the full cost of service for each
direct service in the department. In the previous step, the cost of service was calculated for each direct
and indirect service. In this step, the cost layers are brought together to establish the full cost of service
for a specific direct service, program, or activity. As previously mentioned the cost of each direct service
is calculated. To determine the full cost of service, the cost of indirect services is allocated to each direct
service. The indirect services costs are allocated to each direct service based on each direct services
proportion of labor spent processing each permit and application. By summing the direct and allocated
indirect costs and multiplying that by the activity data, a total cost of service is calculated for both an
individual service and the operating unit as a whole.
Step 4: Set fees
Based on any new, existing, or revised cost recovery policies, the recommended fees can be established.
The recommended fees will be established based on City staff recommendations and Council discussion
in the future. The fee analyses in this report are based on full cost recovery.
Assuring Quality Results
In our analysis we utilize both quantitative and qualitative tests for quality.
Quantitative
Our process incorporates substantial input from both individuals and groups. Our belief is that we get
the best data from group interviews. For example, in determining how much time is required for any
specific type of building inspection, we want to hear the perspective of an inspector, of the inspector
supervisor, and the counter tech or project manager. Each will have a perspective. Each will contribute
value to the estimate. When all perspectives agree, we gave have a good sense of confidence in our
results.
Qualitative
We also utilize four qualitative measure of quality data. When each of these measures match and there
are no major disagreements with the qualitative assessment, we have significant confidence in our
results. These qualitative measures are:
Quantitative Analysis Targeted Margin of Error
1) Budgeted expenses entering the cost models must equal total expenses accounted for in the
costing model.
0%
2) Projected revenue from fees must closely match actual revenue from fees. + or – 5%-10%
Capital Accounting Partners Page 7
3) Available staff time must be fully accounted for in the costing models. 0%
4) Total revenues from fees and contributions from the general fund or other sources must match
total expenses.
0%
Capital Accounting Partners Page 8
Summary of Results
General Observations of Cost Recovery and Pricing
In general, our results suggest that on average, Development Services has a level of cost recovery that
almost covers its budgeted costs. However, our results also show some services are over recovering costs
while other services are significantly under recovering cost. From our experience, this is fairly normal.
One important result of a fee study is the “right sizing” of fees and a rebalancing of fees. The State of
California requires that fees be in proportion to costs.
For example, plumbing fees cannot be priced below cost while mechanical fees are price above cost.
Similarly, green building fees cannot be priced below cost but new construction fees cannot be priced
above cost to compensate for the loss of revenues.
Therefore, establishing the full cost, and setting the price at or as near full cost is an important result of
a fee study.
Valuation Based Fees
The Department recovers a substantial portion of its cost from its valuation based fees. These fees are
generally for construction projects where the fee is based on a multiplier of construction value. Currently,
the City is recovering about the correct amount from these fees. However, year over year, recovery from
these fees may be a little over or a little under full cost. Expenses can be relatively constant but building
activity can be volatile. As building activity heats up, revenues may exceed expenses. As building activity
cools down, revenues may come short of expenses. Graphically, this relationship may appear this way.
Currently, the City uses construction value to determine value as opposed to an independent
assessment of value such as the International Code Council (ICC) valuation tables. Our
recommendation to the City, and one that has been adopted by the Department, is to move towards
using the ICC tables to determine value. This provides an independent assessment of valuation that is
not tied to construction. Using construction value to calculate building fees means that Department
revenues may move up or down depending upon market forces of supply and demand. A tight labor
market will be higher labor costs for construction and City revenues will go up. Conversely, an
Capital Accounting Partners Page 9
Projected
Revenue at
Full Cost
Current
Revenue Difference
$ 2,500 $ 750 ($1,750)
$ 500 $ 750 $250
$ 10,000 $ 7,000 ($3,000)
$ 12,500 $ 3,750 ($8,750)
$ 2,500 $ 1,250 ($1,250)
$ 28,000 $ 13,500 ($14,500)
oversupply of wood products may mean that construction costs go down and the City fees will go
down with accordingly.
The classic example of the two approaches can be seen when two houses with the exact floor plans
are constructed. They both are the same size, they both have the same number of bathrooms, outlets,
electrical panels, and sinks. However, one builder utilizes the cheapest materials and the homeowner
wants the cheapest fixtures. The other builder utilizes the best materials and the home owner wants
the finest fixtures available. The two homes will have very different construction values but the time
and effort to review the plans and conduct all the inspections will be the same.
To move to the ICC valuation of building, and to assure it will recover its cost, the City will need to start
collecting three additional sources of data within its permitting system:
1.Building square footage;
2.Building type of construction; and
3.Building occupancy type.
Without these additional data, it will be impossible to determine the correct multiplier that will result in
full cost recovery. Therefore, we recommend the City begin collecting these data and when there are 6
months of data then calculate the correct multiplier.
Modifications to the Fee Schedule
Another result of a fee study is bringing the schedule of fees up to current code. As part of this study, we
modified the schedule of fees to best reflect the California Building Standards Code. In some cases, this
required little modification. In others, fees were dropped, fees were added, or some fees were simply
renamed. However, in consultation with staff, it is our view that the schedule of fees reflected in our
model brings the City’s fees into alignment with the California Building Standards Code.
Results
Projecting Revenues
The math involved in projecting revenues is basic:
Annual number of times a fee is charged X full cost = annual revenue.
Hypothetical Example of how Revenue is Projected
Fee Description Annual
Activity Full cost Current
Price
Fee 1 10 $ 250 $ 75
Fee 2 5 $ 100 $ 150
Fee 3 20 $ 500 $ 350
Fee 4 50 $ 250 $ 75
Fee 5 25 $ 100 $ 50
Capital Accounting Partners Page 10
In this example, revenues from current fee levels is $13,500 and while these same services priced at full
cost will generate $28,000 or $14,500 more.
Challenges to Accurately Projecting Revenues
Projecting future revenues should be simple. However, there are several challenges to projecting
revenues accurately. Among these are:
1. Errors in the annual activity data;
2. Changes in fee descriptions;
3. New fees that are being from existing fees;
4. Fees where the work is being done but there is no fee to collect; and
5. Differences in timing between permitting systems and financial systems.
Fire Prevention
Fire Prevention is a classic example of how challenging projecting revenues can be. Frequently, Fire
Prevention will be tasked for making inspections, but decisions by the Council prohibit or restrict the
charging of full cost. Many councils will reduce or even eliminate some fees for non-profits, social
service agencies, religious institutions, or operations catering to children.
Public Works and Planning
The Development Services Department is being charged for Planning and Public Works staff. These staff
are built into the Departments budget in the normal budget cycle. The challenge for the Department is
that these costs can be difficult to manage. The fees for Planning and Public Works are set by Council.
The budgets for Planning and Public Works are based upon an assumed level of activity in the spring
before the activity is actually realized. So if the actual activity is greater than projected activity, revenues
higher than cost flow to the Department. However, if actual activity is lower than projected activity,
then the Department has costs that it cannot recover.
Reasons Revenues Can Fail to Meet Expenses
There are several reasons why the Department might fail to meet its expenses. Among these are:
1. The Department is charged with inspection activity but it cannot charge for the service;
2. The Department has budgeted expenses but activity levels are lower than projected;
3. Former estimates required for plan review and inspection are not accurate; and
4. Productive hourly rates assumed in the calculations are not accurate.
Capital Accounting Partners Page 11
Fee Type
Projected Fee
Revenues at Full
Cost
Projected
Revenues at
Current Prices
Difference Surplus /
Subsidy
Valuation
Bldg Permit & Plan Check $ 8,490,666 $ 8,599,967 $ 109,301 1%
Non-Valuation
Building Total 1,819,529$ 1,836,334$ $16,804 1%
Construction & Demolition 149,930$ 124,042$ ($25,888)-17%
Mechanical 166,768$ 387,519$ $220,751 132%
Plumbing 222,406$ 358,690$ $136,284 61%
Electrical 399,632$ 646,484$ $246,852 62%
Green Building 675,347$ 187,421$ ($487,926)-72%
Use and Occupancy 205,447$ 132,178$ ($73,269)-36%
Fire Prevention Total 1,925,540$ 602,020$ ($1,323,520)-69%
Public Works Total 860,363$ 269,792$ ($590,571)-69%
Total Resources Consumed $ 13,096,098 $ 11,308,113 $ (1,787,985)-14%
Summary of Results by Division or Work Unit
The following graphic outlines various levels of recovery for each of the major work units within the
Development Services Department. It shows, for example, that the Building function is subsidizing Fire
Prevention, Planning, and Public Works. It should be noted however, that these data are based on
current activity levels and the normal year to year changes to these activity levels can change these
results.
Project Revenues Based on Current Activity Levels
Why Differences in Recovery Levels?
There can be a many reasons why there are differences in cost recovery levels. Our observation is that
the Department is under-recovering its fees. Much of this can be corrected by a rebalancing of fees. In
other words, each division should be generating enough revenue to recover its costs. From our
observations, the following are some reasons why each work group is either over recovering or under
recovering its expenses.
Building Observations
The data suggests that Building Division is financially supporting the Department. There can be several
reasons for this:
Activity levels are escalating faster than staffing (expenses) can be added. This has the input of
showing that revenues are exceeding expenses.
Reliance on construction value vs an independent calculation such as the ICC valuation table. As
building activity increases, basic supply and demand rules will push construction value higher.
This will have the impact of increasing revenues to the City without incurring additional
expenses.
Capital Accounting Partners Page 12
Estimates of time to provide inspection and plan review services are incorrect. We see this in
the current rates for mechanical, electrical, and plumbing fees for new construction. The
current price is $.11/SF. Based on our analysis and in discussions with inspectors, the actual
calculated cost is $.02/SF.
Fire Prevention Observations
Under recovering costs for Fire Prevention services is fairly common in the State of California.
Sometimes this is by design but of often is it is not. From our observation there are three reasons why
the City is under recovering costs of Fire Prevention:
1. Previous estimates of how much time is required for inspection and plan review time is different
than actual.
2. Previous estimates of productive hourly rates are different and have not been updated until
now.
3. The work unit is making inspections and providing a services but either the fee is not being
charged or there is no fee.
If the City were to decide that full cost recovery is in its best interest, then the fees the department
collects, based on our calculations, should fully recover the cost of this function.
Capital Accounting Partners Page 13
Observations and Recommendations
General Observations and Recommendations
As stated earlier, we observe that the Department is nearly recovering its expenses. However, “right
sizing” its fees and adjusting its fees so that each division is recovering its costs is an important result of
a fee study. We also observe that there are no built in costs to build reserves. We generally recommend
reserves for building departments to be targeted at 6-12 months of operating expenses. For the
Department, this would be a range of $6,500,000 - $13,000,000.
What is Not Covered in this Analysis
We are frequently asked “did you look at efficiency”. The simple answer is no, this was not within the
scope of the project. However, we would add that with experience, certifications, and qualifications that
we hold in the disciplines of process management and the application of lean thinking within the public
sector we are very sensitive to this question. We would also add, that from our experience in providing
these services, that seldom do they generate short term cost savings. The benefit they do bring in the
short term is improvements in customer service. Plan review is completed faster. In the long term, they
can reduce the escalation of costs.
We are also frequently asked about work load demands. Again, this was outside project scope.
However, we understand that the City is an ISO Class 1 accredited City. Only one of four in the State of
California and one of 9 in the country. This is a prestigious award. From discussions with leadership,
maintaining this certification may be a challenge going forward. Additional resources may be required to
maintain the staffing to workload levels required by ISO.
Assessing Valuation Based Fees
As stated previously, the current methodology of assessing value, from which new construction building
permits are based, is to use construction value. In addition, several other fees are derived from the
calculation of permit value. From our observation, a better approach is to base value off an independent
calculation of value such as the International Code Council (ICC) Valuation Table. This reduces
fluctuations in revenues (up or down) to the City due to local supply & demand pressures, pricing and
selection of internal fixtures, and temporary swings in commodities.
However, moving toward this method will require additional data to be gathered on building permits.
This will include data on the square footage of buildings, occupancy type, and building construction
type. Without these data it will be impossible to accurately calculate what the multiplier needs to be to
generate an appropriate level of cost recovery.
We understand that this will be the objective of phase two of the user fee study.
Adjusting the Fee Schedule
A standard recommendation of ours is that fees be adjusted annually. We also recommend a complete
review of costs for fee services every three to five years. With the annual update of fees, we
recommend using a simple CPI type increase that is attached to the City’s labor cost. For example, if the
Capital Accounting Partners Page 14
labor cost for the City goes up by 2% then adjust each fee by 2%. This is the simplest and most common
method of adjusting fees annually. It is our observation that the regulatory requirements change enough
within a three to five years that a comprehensive review of costs is then warranted.
We understand that the City’s policy is to adjust fees annually based on changes to salaries and benefits.
We would affirm this practice and find that those cities that do this, maintain better cost recovery levels
over the long term.
Building Reserves
We regularly recommend 6-12 months of operating expenses as a reserve. We understand from staff
that this will be a discussion for a later time. We would affirm this plan but also recommend that a
reserve policy be set into place. This policy might target:
Specific reserves (such as 12 months of operating expenses);
An understanding of how the reserve will be managed; and
How will a reserve be defined and realized?
Capital Accounting Partners Page 15
DEVELOPMENT SERVICES FEE TABLE
The following table details the individual unit costs of each fee in the Department and provides annual revenue
impacts for each fee and all fees collectively.
Palo Alto Building Dept
Building Fees
Service
# If
Any
Fee Name Unit/Notes Actual Work
Volume Bldg Time Fire Time Planning
Time PW Time Direct Unit Cost
Indirect Unit
Allocated
Costs
Other
external
costs
Total Cost
Assigned
Current
Fee / Revenue
Unit Surcharge or
(Subsidy)
Unit Cost SummaryUnit Time Assignments
BUILDING FEES
1,165 Business Registry Fee per business -$ 50.00$ $50
-$
Building New Construction -$
All Valuation Based Building Fees Combined (total annual
Calculations)5,973,018$ 2,517,648$ $8,490,666 8,599,967.00$ $109,301
-$
1,217 I. Building Demolition Permit 177 1.17 0.333 234$ $152 $386 320.00$ ($66)
1,218 J. Commercial Interior Non-Structural Demolition Permit 39 0.33 0.333 106$ $69 $175 194.00$ $19
-$
1,207 Additional Plan Review per hour 117 1 122$ $79 $201 191.00$ ($10)
1,202 Building Plan Check per hour -$ -$
1,208 Certified Access Specialist (CASp) Review/Consultation Hourly 1 159$ $103 $262 -$ ($262)
1,203 -$
1,204 Address change - single address 1 0.25 216$ $140 $356 224.00$ ($132)
1,206 Address change - each additional address 0.42 0.167 104$ $67 $171 112.00$ ($59)
1,205 -$
-$
Construction & Demolition -$
1,198
Commercial and Multi-Family Projects greater than or equal to
$25,000.00 in Valuation per permit 89 0.334 1.000 224$ $145 $369 238.00$ ($131)
1,200
Single Family and Two Family Projects greater than $25,000.00 and
less than $75,000.00 in Valuations per permit 18 0.334 0.250 93$ $61 $154 80.00$ ($74)
1,199
Single Family and Two Family Projects greater than $75,000.00 in
Valuation per permit 71 0.334 0.500 137$ $89 $225 212.00$ ($13)
-$
-$
ELECTRICAL PERMITS
1,228 Air Conditioners per unit 39 0.5 49$ $32 $81 29.00$ ($52)
1,230 Air Cooled or Oil Cooled Lighting and/or Power Transformer per permit 0.50 49$ $32 $81 -$ ($81)
1,226 Base Fee per permit 1,696 0.33 50$ $32 $82 92.00$ $10
1,240 Busway, Power Duct install, repair or replace per permit 20 0.42 41$ $27 $68 0.50$ ($67)
1,229 per permit 0.42 41$ $27 $68 252.00$ $184
1,249 Each Additional section of meter per permit 2 0.42 41$ $27 $68 5.00$ ($63)
1,234 Fixtures, Switches, and Outlets per permit 1,633 0.42 41$ $27 $68 1.00$ ($67)
1,241
Lighting, Power and/or Control Panel Board, Switchboard Cabinet or
Panel per permit 43 0.42 41$ $27 $68 5.00$ ($63)
1,236 Motor per permit 13 0.42 41$ $27 $68 23.00$ ($45)
1,235 Motor Generator per permit 40 0.42 41$ $27 $68 3.00$ ($65)
1,227 New or Remodeled Square Footage Per SqFt 3,723,840 0.00012 $0.01 $0.01 $0.02 0.11$ $0.09
1,237 Range, Electric Clothes Dryer, or Water Heater per permit 2 0.42 41$ $27 $68 5.00$ ($63)
-$
1,248 Service Conductor/Switch - Greater than 800 ampre per permit 2 1.50 148$ $96 $243 40.00$ ($203)
1,246 Service Conductor/Switch - Less than 200 ampre per permit 128 0.75 74$ $48 $122 18.00$ ($104)
1,247 Service Conductor/Switch - Less than 800 ampre per permit 11 1.00 98$ $64 $162 29.00$ ($133)
1,238 Special Circuit (Not Listed Herein)per permit 26 0.42 41$ $27 $68 5.00$ ($63)
1,250 Temporary Power Pole per permit 149 0.42 41$ $27 $68 56.00$ ($12)
1,251 Temporary Wiring for Construction per permit 0.42 41$ $27 $68 56.00$ ($12)
-$
Electrical Permits - Electrical Vehicle Charging Stations -$
Capital Accounting Partners Page 1 of 14 BldCostCalcs
Palo Alto Building Dept
Building Fees
Service
# If
Any
Fee Name Unit/Notes Actual Work
Volume Bldg Time Fire Time Planning
Time PW Time Direct Unit Cost
Indirect Unit
Allocated
Costs
Other
external
costs
Total Cost
Assigned
Current
Fee / Revenue
Unit Surcharge or
(Subsidy)
Unit Cost SummaryUnit Time Assignments
1,232 Commercial (Level 1 and 2)17 2.00 232$ $150 $382 370.00$ ($12)
1,233 Commercial (Level 1 and 2) - each additional station 79 0.42 45$ $29 $74 92.50$ $18
1,233 Commercial (Level 3 and 4)1 2.50 281$ $182 $464 560.00$ $96
1,234 Commercial (Level 3 and 4) - each additional station 0.50 55$ $36 $91 140.00$ $49
1,231 Residential (level 1 & 2)per station 57 0.92 102$ $66 $168 160.00$ ($8)
Residential (level 3)1.33375 143$ $93 $236 ($236)
Electrical Permits - Photovoltaic Systems -$
Residential System (less than 10 kw)127 0.5 49$ $32 $81 ($81)
1,242 Residential System (greater than 10 kw)each 1.875 185$ $120 $304 311.00$ $7
1,243 Commercial System (less than 10 kW)each 2.833333333 326$ $211 $537 565.00$ $28
1,244 Commercial System (10kW - 49kW)each 3 4.25 489$ $317 $805 850.00$ $45
1,245 Commercial System (greater than 49kW)each 1 4.666666667 530$ $343 $873 900.00$ $27
MECHANICAL PERMITS
Swimming Pool Heather 23 0.40 39$ $26 $65 28.00$ ($37)
1,254 Admin base fee 1,021 0.334 50$ $32 $82 92.00$ $10
Mechanical new or remodel cost/SF Per SqFt 2,632,100 0.00012 $0.012 $0.008 $0.02 0.11$ $0
1a -$ 28.00$ $28
1b Furnaces 98 1.002 99$ $64 $163 92.00$ ($71)
1c 0.002 0$ $0 $0 ($0)
1d -$
2 Appliance vents: installation, relocation or replacement of…0.335333 33$ $21 $54 28.00$ ($26)
3 Repairs, alteration or addition of each heating appliance… 0.335333 33$ $21 $54 28.00$ ($26)
Boilers, Compressors, and Absorption Systems:-$
4a
Up to and including 3 HP, absorption system up to and including
100,000 Btu/h 0.67 66$ $43 $109 5.00$ ($104)
4b
Up to and including 15HP, absorption system exceeding 100,000
Btu/h and including 500,000 Btu/h 86 0.67 66$ $43 $109 28.00$ ($81)
4c
Up to and including 15-30HP, absorption system exceeding 500,000
Btu/h and including 1,000,000 Btu/h 0.67 66$ $43 $109 0.11$ ($108)
4d
Up to and including 30-50HP, absorption system exceeding
1,000,000 Btu/h and including 1,750,000 Btu/h 1.00 99$ $64 $163 28.00$ ($135)
4e Greater than50HP, absorption system exceeding 1,750,000 Btu/h 1.00 99$ $64 $163 56.00$ ($107)
5 Air handlers up to and including 10,000 cf per cfm…0.34 33$ $21 $54 28.00$ ($26)
Ventilation and exhaust:-$
7a Each ventilation FAC connect to a single duct 76 0.34 33$ $21 $54 11.00$ ($43)
7b
Each ventilation system that is not a portion of a heating or air-
conditioning system …0.34 33$ $21 $54 ($54)
7c
Installation of each hood that is served by mechanical exhaust,
including the ducts of such hood 2 0.34 33$ $21 $54 28.00$ ($26)
Miscellaneous -$
9
Each appliance or piece of equipment regulated by this code, but
not classed in other appliance categories for which no other fee is
listed in this table 0.34 33$ $21 $54 ($54)
Full Gas Piping -$
10a Each gas piping system of 1-5 outlets 4 0.60 59$ $38 $98 28.00$ ($70)
10b Each additional gas piping system per outlet 0.33 33$ $21 $54 ($54)
Process Piping -$
11a Each hazardous process piping system 1-4 outlets 0.34 33$ $21 $54 28.00$ ($26)
11b Each hazardous process piping system >5 outlets 0.33 33$ $21 $54 28.00$ ($26)
11c Each nonhazardous process piping system of 1-4 outlets 0.80 79$ $51 $130 56.00$ ($74)
Capital Accounting Partners Page 2 of 14 BldCostCalcs
Palo Alto Building Dept
Building Fees
Service
# If
Any
Fee Name Unit/Notes Actual Work
Volume Bldg Time Fire Time Planning
Time PW Time Direct Unit Cost
Indirect Unit
Allocated
Costs
Other
external
costs
Total Cost
Assigned
Current
Fee / Revenue
Unit Surcharge or
(Subsidy)
Unit Cost SummaryUnit Time Assignments
11d Each NPP piping system of >5 outlets, per outlet 0.80 79$ $51 $130 5.00$ ($125)
PLUMBING PERMITS - GRAY WATER SYSTEMS
1,266 Admin base fee 1,310 0.334 50$ $32 $82 92.00$ $10
1 For each plumbing fixture on one trap or set of fixtures..0.5 49$ $32 $81 3.00$ ($78)
2 For each building sewer and each trailer park sewer 15 0.802 79$ $51 $130 28.00$ ($102)
3 Rainwater system - per drain (inside building)66 0.5 49$ $32 $81 5.00$ ($76)
4 For each private sewage disposal system 120 0.802 79$ $51 $130 11.00$ ($119)
6 For each water heater, vent, or both 56 0.6 59$ $38 $97 5.00$ ($92)
7 For each gas piping system of one to five outlets 142 1.2 118$ $77 $195 28.00$ ($167)
8 For each additional gas piping system outlet, per outlet 0.3 30$ $19 $49 5.00$ ($44)
9
Industrial waste pretreatment interceptor, including trap and vent, X
kitchen-type grease interceptors 1.2 118$ $77 $195 11.00$ ($184)
10
Installation, alteration or repair of water piping, water treatment
equip or both 1 0.6 59$ $38 $97 5.00$ ($92)
11 Repair or alteration of drainage or vent piping, each fixture 16 0.5 49$ $32 $81 28.00$ ($53)
12
Lawn sprinkler system on one meter including backflow protection
devices 0.5 49$ $32 $81 28.00$ ($53)
13A Atmospheric-type vacuum breakers not referenced above (1-5)0.6 59$ $38 $97 5.00$ ($92)
13B Atmospheric-type vacuum breakers not referenced above (>5)0.5 49$ $32 $81 5.00$ ($76)
14 Backflow protective device other than atmospheric-type (any size)78 1.2 118$ $77 $195 5.00$ ($190)
Plumbing Permits - Graywater Systems -$
1,271 Clothes washer System 0.5 49$ $32 $81 56.00$ ($25)
1,273 Complex System 1 1.2 118$ $77 $195 88.00$ ($107)
1,272 Simple System 3 0.5 49$ $32 $81 61.00$ ($20)
16 Installation and testing for a reclaimed water system 1.2 118$ $77 $195 -$ ($195)
17 Annual cross-connection testing of reclaimed water system…2.4 236$ $153 $390 ($390)
18 Each medical gas piping system 1-5 outlets 1.2 118$ $77 $195 ($195)
Additional medical gas inlet(s)0.25 25$ $16 $41 -$ ($41)
Electrical new or remodel cost/SF 2,127,236 0.00012 0.012$ 0.008$ 0.02$ 0.11$ $0
Solar hot water system 1.2 118.187$ 76.594$ 194.78$ 224.00$ $29
1,190 Storm drain system 1.2 118$ $77 $195 28.00$ ($167)
1,191 Swimming pool 0.4 39$ $26 $65 28.00$ ($37)
Use & occupancy Permits
1,187 Certificate of Use and Occupancy each 155 2.5 456$ $296 $752 287.00$ ($465)
1,188 Certificate of Use and Occupancy - Replacement each 0.5 94$ $61 $155 123.00$ ($32)
1,189 -$
1,186
Temporary Occupancy Permit - Multi-Family Residential, Non-
Residential, and Other Commercial each 33 2.3 365$ $237 $602 896.00$ $294
1,185
Temporary Occupancy Permit - Single Family Residential and
Commercial Tenant Improvement less than 10,000 sq. ft.each 155 1.7 270$ $175 $445 375.00$ ($70)
-$
FIRE FEES
Hazardous Materials Classification Permits -$
1,367 Compressed Gas annually 28 1 229$ $121 $350 139.00$ ($211)
1,363 Corrosives annually 54 1 229$ $121 $350 139.00$ ($211)
1,364 Cryogenic Fluid annually 42 1 229$ $121 $350 139.00$ ($211)
1,365 Flammable and Combustible Liquids annually 172 1 229$ $121 $350 139.00$ ($211)
1,368 Flammable Gas annually 28 1 229$ $121 $350 139.00$ ($211)
1,366 Flammable Solids annually 1 229$ $121 $350 139.00$ ($211)
1,373 Health Hazard (Liquids & Solids)annually 33 1 229$ $121 $350 139.00$ ($211)
Capital Accounting Partners Page 3 of 14 BldCostCalcs
Palo Alto Building Dept
Building Fees
Service
# If
Any
Fee Name Unit/Notes Actual Work
Volume Bldg Time Fire Time Planning
Time PW Time Direct Unit Cost
Indirect Unit
Allocated
Costs
Other
external
costs
Total Cost
Assigned
Current
Fee / Revenue
Unit Surcharge or
(Subsidy)
Unit Cost SummaryUnit Time Assignments
1,381 Liquefied Petroleum Gases annually 10 1 229$ $121 $350 139.00$ ($211)
1,354 Organic Coatings annually 1 229$ $121 $350 175.00$ ($175)
1,374 Organic Peroxides annually 1 1 229$ $121 $350 139.00$ ($211)
1,355 Ovens - Industrial Baking or Drying annually 4 1 229$ $121 $350 102.00$ ($248)
1,375 Oxidizers (Liquids & Solids)annually 16 1 229$ $121 $350 139.00$ ($211)
1,369 Oxidizing Gas annually 34 1 229$ $121 $350 139.00$ ($211)
1,356 Parade Float per hour 1 229$ $121 $350 115.00$ ($235)
1,357 Place of Public Assembly per occurrence 2 457$ $242 $700 236.00$ ($464)
1,370 Pyrophoric Gas annually 1 1 229$ $121 $350 139.00$ ($211)
1,376 Pyrophoric Materials (Liquids & Solids)annually 4 1 229$ $121 $350 139.00$ ($211)
1,358 Pyrotechnical Special Effects Material annually 1 229$ $121 $350 29.00$ ($321)
1,377 Radioactive Materials annually 28 1 229$ $121 $350 139.00$ ($211)
1,359 Refrigeration Equipment annually 1 229$ $121 $350 175.00$ ($175)
1,360 Spraying/Dipping annually 17 1 229$ $121 $350 175.00$ ($175)
1,361
Tent or air-supported structure having an area in excess of 200
square feet; or canopies in excess of 400 square feet (includes a
public assembly permit of $125.00 for all tents)each 2.167 485$ $257 $741 290.00$ ($451)
1,362 Tire Recapping/Tire Storage annually 4 913$ $483 $1,396 575.00$ ($821)
1,371 Toxic, Highly Toxic, Moderately Toxic, Health Hazard Gas annually 11 1 229$ $121 $350 139.00$ ($211)
1,378 Toxic, Highly Toxic, Moderately Toxic, Health Hazard Materials annually 38 1 229$ $121 $350 139.00$ ($211)
1,372 Unstable Reactive Gas annually 1 1 229$ $121 $350 139.00$ ($211)
1,379 Unstable Reactive Materials (Liquids & Solids)annually 1 229$ $121 $350 139.00$ ($211)
1,380 Water Reactive Materials (Liquids & Solids)annually 1 229$ $121 $350 139.00$ ($211)
1 229$ $121 $350 ($350)
Hazardouis Materials County Reimbursement -$ 348,000.00$ $348,000
Hazardous Materials Storage Permits -$
1,311
Additional Approvals for Hazardous Materials Storage Permit (first 2
hours)2.167 496$ $262 $758 356.00$ ($402)
1,312
Additional Approvals for Hazardous Materials Storage Permit (per
hour for time above 2 hours)1.417 324$ $172 $496 159.00$ ($337)
1,308 Business Plan (HMBP)annually 234 1.417 324$ $172 $496 256.00$ ($240)
1,312 Late Fee for Hazardous Materials Storage Permit -$ -$
1,305 Level I Facility 81 1 229$ $121 $350 264.00$ ($86)
1,306 Level II Facility 119 2 457$ $242 $700 404.00$ ($296)
1,307 Level III Facility 191 4 915$ $484 $1,399 729.00$ ($670)
1,309 Petroleum Aboveground Storage Tank annually 26 2 457$ $242 $700 593.00$ ($107)
1,310 Provisional (6 Month)2 457$ $242 $700 186.00$ ($514)
-$
-$
Fire Inspection Fees -$
1,313
Additional Resinspection Fee (up to 2 hours during normal business
hours)150 2 456$ $242 $698 323.00$ ($375)
1,313 Additional Resinspection Fee (each additional hour)1 228$ $121 $349 159.00$ ($190)
1,314 After Hours Inspection Fee 1.5 342$ $181 $523 165.00$ ($358)
Capital Accounting Partners Page 4 of 14 BldCostCalcs
Palo Alto Building Dept
Building Fees
Service
# If
Any
Fee Name Unit/Notes Actual Work
Volume Bldg Time Fire Time Planning
Time PW Time Direct Unit Cost
Indirect Unit
Allocated
Costs
Other
external
costs
Total Cost
Assigned
Current
Fee / Revenue
Unit Surcharge or
(Subsidy)
Unit Cost SummaryUnit Time Assignments
1,316 Care Facility annually -$ 175.00$ $175
1,317 Care Facility Inspection Including Fire Clearance (greater than 25 2 456$ $242 $698 73.00$ ($625)
Care Facility Inspection Including Fire Clearance (7-25 clients)1 228$ $121 $349 140.00$ ($209)
1,315 Christmas Tree Lot/Pumpkin Patch each 1 228$ $121 $349 175.00$ ($174)
1,321 High Rise Building - Certificate of Compliance (annually up to 4 4.167 951$ $503 $1,454 713.00$ ($741)
1,322 High Rise Building - Certificate of Compliance (each additional hour))1 228$ $121 $349 159.00$ ($190)
1,318 Outside Cooking Booths each 1.5 342$ $181 $523 198.00$ ($325)
1,320 Standby Fire Watch or After Hours at Fire or Incident Scene per hour 1 228$ $121 $349 159.00$ ($190)
1,319 Use and Occupancy Fire Inspection per inspection 155 1 228$ $121 $349 148.00$ ($201)
As-Built Plan Check and Additional Work each 75 2 456$ $242 $698 ($698)
-$
Investigations & Consultations -$
1,325 Additional Hours Over Plan Review/Inspection each 1 181$ $96 $276 155.00$ ($121)
1,323 Alternate Means and Methods Application per application 75 2 429$ $227 $657 356.00$ ($301)
1,324 Appeals to Decisions per hour 1 228$ $121 $349 159.00$ ($190)
1,322 Consultation Fee per hour 475 1 228$ $121 $349 166.00$ ($183)
1,328 Hazardous Materials Data Entry Fee per hour -$ 77.00$ $77
1,327 Hydrant Flow Fee per occurrence 75 1 228$ $121 $349 165.00$ ($184)
1,326 Site Disaster Planning per hour 1 228$ $121 $349 166.00$ ($183)
-$
-$
Life Safety & Fire Protection
1294A Automatic Fire Sprinkler Installation/Modification > 19 heads 4.417 1,008$ $534 $1,541 356.00$ ($1,185)
1,295 Automatic Fire Sprinkler Installation/Modification (plus per head)0.01 2$ $1 $3.49 1.80$ ($2)
1,301 Express Fire Protection Plan Check Fee 50% of usual fee -$ 163.00$ $163
1,296 Fire Alarm System Installation and Modification 3 637$ $337 $974 356.00$ ($618)
1,297
Fire Alarm System Installation and Modification (plus a device or
contact point)0.060 14$ $7 $20.94 2.00$ ($19)
1,303
Fire Protection and Fire Access Plan Review for New Single Family
Dwellings or Additions each 2.5 523$ $277 $800 100.00$ ($700)
1,298 Hydrant Installation/Modification - Private 0.5 114$ $60 $174 261.00$ $87
1,295 Other Automatic Fire Extinguishing System 3 637$ $337 $974 356.00$ ($618)
1,297 Standpipe System - Wet, Dry, or Combination 25 2 456$ $242 $698 208.00$ ($490)
1,300 Temporary Certificate of Occupancy per occurrence 2.167 494$ $262 $756 356.00$ ($400)
1,299 Underground Fire Service Line
per 200LF of pipe
(inspection,
reinspection - 150 5 1,093$ $579 $1,672 356.00$ ($1,316)
1,304 Verification of Fire Protection System Maintenance and Certification annually 0.3 51$ $27 $78 89.00$ $11
Food truck permits 0.5 114$ $60 $174 ($174)
Multifamily dwellings, hotels & motels -$
4-50 units 1 228$ $121 $349 ($349)
51-100 units 2 456$ $242 $698
Greater than 100 units 3 684$ $362 $1,047 ($1,047)
Fire Prevention Inspection of Private Schools 2 456$ $242 $698 ($698)
1294B Automatic Fire Sprinkler Installation/Modification > 19 heads 2 456$ $242 $698 ($698)
Specific Hazard Permits -$
1,329 Aerosol Products annually 1.25 285$ $151 $436 102.00$ ($334)
1,330 Amusement Buildings Delete -$ 410.00$ $410
Capital Accounting Partners Page 5 of 14 BldCostCalcs
Palo Alto Building Dept
Building Fees
Service
# If
Any
Fee Name Unit/Notes Actual Work
Volume Bldg Time Fire Time Planning
Time PW Time Direct Unit Cost
Indirect Unit
Allocated
Costs
Other
external
costs
Total Cost
Assigned
Current
Fee / Revenue
Unit Surcharge or
(Subsidy)
Unit Cost SummaryUnit Time Assignments
1,331 Automobile Wrecking Yard or Junk Yard Delete -$ 179.00$ $179
1,332 Bowling Alley and Pin Refinishing Involving the use of Flammable each 2.917 666$ $352 $1,018 179.00$ ($839)
1,333 Candles and Open Flames in Assembly Areas annually 1 228$ $121 $349 142.00$ ($207)
1,334 Carnivals and Fairs each 4.167 951$ $503 $1,454 179.00$ ($1,275)
1,335 Cellulose Nitrate Storage/Nitrate Film annually 0.292 67$ $35 $102 102.00$ $0
1,337 Combustible Fiber/Material Storage Delete -$ 179.00$ $179
1,336 Confined Space annually -$ 148.00$ $148
1,338 Hot Work permit fee (one time permit)One time 1 228$ $121 $349 126.00$ ($223)
1,339 Hot Work permit fee (monthly permit)Monthy -$ 88.00$ $88
1,340 -$ 102.00$ $102
1,341 Fireworks Display Delete 3.167 723$ $383 565.00$ $565
1,342 High-piled Combustible Storage Delete -$ 102.00$ $102
1,343 Hot Work (Welding) Operations Delete -$ 179.00$ $179
1,349 Liquid or Gas-Fueled Powered Equipment each 1 228$ $121 $349 88.00$ ($261)
1,344 Liquid or Gas-Fueled Vehicles or Equipment in Assembly Buildings each -$ 103.00$ $103
1,350 Magnesium Working annually -$ 103.00$ $103
1,345 Malls - Covered annually 2 456$ $242 $698 103.00$ ($595)
1,351 Occupant Load Increase - Temporary Public Assembly each 1 228$ $121 $349 236.00$ ($113)
1,352 Open Burning each 1 228$ $121 $349 236.00$ ($113)
1,348 Open Flame/Flame Producing Devices each 1 228$ $121 $349 88.00$ ($261)
1,353 Operate a Tank Vehicle to Transport Flammable/Combustible annually 1.417 323$ $171 $494 102.00$ ($392)
1,347 Place of Public Assembly - Temporary each 1 228$ $121 $349 236.00$ ($113)
1,346 Temporary Kiosks -$ -$
-$
Fire Miscellaneous Fees -$
TCO fee for Vendors/Stock occupancy (Requires at least one
additional inspection)250 3.5 752$ $398 $1,150 ($1,150)
1,288 Emergency Response Fee - Hazmat (PAMC 17.24.050)Per hour 1 228$ $121 $349 -$ ($349)
1,289 Installation or Closure Without Approved Plans and/or Permits Fine -$ -$
Fire plans revision 76 -$
Building General & Miscellaneous Fees -$
1,176 All Other Publications each -$ 16.00$ $16
1,201 Construction/Maintenance Vehicles -$ 76.00$ $76
1,172 Electric Service and Safety Inspection per hour 1 98$ $52 $151 84.00$ ($67)
1,181 Extension of Building Permit or Building Permit Application per application 31 0.33 56$ $30 $86 56.00$ ($30)
1,174
Inspections and Investigations - Outside Normal Business Hours
(1.5xOThour)1 1.5 238$ $126 $365 202.00$ ($163)
1,175
Inspections and Investigations - Outside Normal Business Hours
(2.0xOThour)52 2 318$ $168 $486 226.00$ ($260)
1,173 Inspections and Investigations - Unclassified per hour 1 159$ $84 $243 163.00$ ($80)
1,184 Reactivation of Expired Building Permit - All Others 19 0.75 149$ $79 $228 ($228)
1,183 Reactivation of Expired Building Permit - Final Inspection Only 16 1.1 165$ $88 $253 375.00$ $122
1,182 Reactivation of Expired Building Permit Application 16 0.7 124$ $65 $189 168.00$ ($21)
1,178 Real Property Research Fee (1-hour minimum)per hour 1.0 159$ $84 $243 127.00$ ($116)
1,177 Records Retention per plan sheet 20,234 0.0 4$ $2 $6 4.00$ ($2)
1,180 Reinspection Fee - Multi-Family Residential and Non-Residential each 2 1.2 184$ $97 $281 308.00$ $27
1,179
Reinspection Fee - Single Family Residential (each secondary
inspection type)14 0.9 144$ $76 220$ 84.00$ ($136)
Capital Accounting Partners Page 6 of 14 BldCostCalcs
Palo Alto Building Dept
Building Fees
Service
# If
Any
Fee Name Unit/Notes Actual Work
Volume Bldg Time Fire Time Planning
Time PW Time Direct Unit Cost
Indirect Unit
Allocated
Costs
Other
external
costs
Total Cost
Assigned
Current
Fee / Revenue
Unit Surcharge or
(Subsidy)
Unit Cost SummaryUnit Time Assignments
1,180
Reinspection Fee - Single Family Residential (each primary
inspection type)1.2 184$ $97 281$ 308.00$ $27
1,171 Request for Release of Building Plans each 0.3 50$ $26 $76 45.00$ ($31)
1,175 Residential Inspection Guidelines each -$ 33.00$ $33
Conditional Utility Agreement 187 0.98 155$ $82 $237 252.00$ $15
Emergency Responder Radio Coverage (testing) fee.25 2 409$ $216 $625 ($625)
GREEN BUILDING FEES
Bldg
Alterations and additions for single and multifamily < 1,000 sq ft and
increases conditioned space Residential 99 3.70 495$ $602 $1,097 677.00$ ($420)
Bldg Alterations and additions for single and multifamily > 1,000 sq ft Residential 166 4.20 556$ $676 $1,232 173.00$ ($1,059)
Bldg Multi Family New Construction of 3 or More (attached) Units 4 5.10 681$ $827 $1,508 668.00$ ($840)
Bldg Multi Family New Construction of < 4 Residential 4.10 559$ $679 $1,238 1,388.00$ $150
Bldg New Single family Residential 7 4.60 620$ $753 $1,373 1,687.00$ $314
Bldg
Tenant improvements, renovations, or alterations > 5,000 sq ft that
includes replacement or alteration of
at least two of the following: HVAC system, building envelope, hot
water system, or lighting
system and project value greater than $200,000.Non-Residential 34 5.10 681$ $827 $1,508 942.00$ ($566)
Bldg
C. Tenant improvements, renovations or alterations > $200,000 in
valuation (and not triggered by a Calgreen Tier) Non-Residential 42 4.10 559$ $679 $1,238 354.00$ ($884)
Bldg
If the project is over $100,000 Energy Star is required after 12
months of occupancy Non-Residential 2.10 315$ $383 $698 976.00$ $278
Bldg New commercial 1000 - 25,000 SF Non-Residential 21 6.10 803$ $975 $1,778 1,443.00$ ($335)
Bldg New commercial 25,001-50,000 SF Non-Residential 7.10 924$ $1,123 $2,048 ($2,048)
Bldg New commercial >50,000 SF Non-Residential 7.60 985$ $1,197 $2,183 ($2,183)
Bldg Landscape Review - plan review Non-Residential 60 3.25 656$ $797 $1,453 ($1,453)
Bldg Landscape Review - inspection Non-Residential 60 1.00 98$ $120 $218 ($218)
Bldg Landscape Review - plan review SFR 80 2.00 404$ $490 $894 ($894)
Bldg Landscape Review - inspection SFR 80 1.00 98$ $120 $218 ($218)
Bldg Landscape Review - plan review Multifamily 10 3.25 656$ $797 $1,453 ($1,453)
Bldg Landscape Review - inspection Multifamily 10 1.00 98$ $120 $218 ($218)
Bldg -$
Fee # 325 Current -$
Capital Accounting Partners Page 7 of 14 BldCostCalcs
Palo Alto Building Dept
Building Fees
Service
# If
Any
Fee Name
BUILDING FEES
1,165 Business Registry Fee
Building New Construction
All Valuation Based Building Fees Combined (total annual
Calculations)
1,217 I. Building Demolition Permit
1,218 J. Commercial Interior Non-Structural Demolition Permit
1,207 Additional Plan Review
1,202 Building Plan Check
1,208 Certified Access Specialist (CASp) Review/Consultation
1,203
1,204 Address change - single address
1,206 Address change - each additional address
1,205
Construction & Demolition
1,198
Commercial and Multi-Family Projects greater than or equal to
$25,000.00 in Valuation
1,200
Single Family and Two Family Projects greater than $25,000.00 and
less than $75,000.00 in Valuations
1,199
Single Family and Two Family Projects greater than $75,000.00 in
Valuation
ELECTRICAL PERMITS
1,228 Air Conditioners
1,230 Air Cooled or Oil Cooled Lighting and/or Power Transformer
1,226 Base Fee
1,240 Busway, Power Duct install, repair or replace
1,229
1,249 Each Additional section of meter
1,234 Fixtures, Switches, and Outlets
1,241
Lighting, Power and/or Control Panel Board, Switchboard Cabinet or
Panel
1,236 Motor
1,235 Motor Generator
1,227 New or Remodeled Square Footage
1,237 Range, Electric Clothes Dryer, or Water Heater
1,248 Service Conductor/Switch - Greater than 800 ampre
1,246 Service Conductor/Switch - Less than 200 ampre
1,247 Service Conductor/Switch - Less than 800 ampre
1,238 Special Circuit (Not Listed Herein)
1,250 Temporary Power Pole
1,251 Temporary Wiring for Construction
Electrical Permits - Electrical Vehicle Charging Stations
Annual Revenue
Revenue at Full Cost of
Services
Projection of
Revenues at
Current Fees
Annual Surplus
(subsidy)
R
e
q
u
i
6 Months Reserve,
3 yr build up Full Cost / Unit With Reserves
Annual Cost Calculations w/o Reserves Reserve Requirements
BUILDING FEES $ 2,307,699
1,165Business Registry Feeper business -$ 50.00$ $50 -$ $ -
-$ -$ $ - $ -
Building New Construction -$ -$ $ - $ -
5,973,018$ 2,517,648$ $8,490,666 8,599,967.00$ $109,301 8,490,666$ 8,599,967$ $109,301 $1,496,163 $ 9,986,829.26 $9,986,829
-$ -$ $ -
1,217I. Building Demolition Permit1771.17 0.333 234$ $152 $386 320.00$ ($66)68,288$ $56,640 ($11,648)$68 $ 453.79 $80,321
1,218J. Commercial Interior Non-Structural Demolition Permit390.33 0.333 106$ $69 $175 194.00$ $19 6,833$ $7,566 $733 $31 $ 206.09 $8,037
-$ -$ $ -
1,207Additional Plan Reviewper hour1171 122$ $79 $201 191.00$ ($10)23,497$ $22,347 ($1,150)$35 $ 236.21 $27,637
1,202Building Plan Checkper hour -$ -$ -$ $ -
1,208Certified Access Specialist (CASp) Review/ConsultationHourly1 159$ $103 $262 -$ ($262)-$ $46 $ 308.01
1,203 -$ -$ $ -
1,204Address change - single address10.25 216$ $140 $356 224.00$ ($132)-$ $63 $ 418.65
1,206Address change - each additional address0.420.167 104$ $67 $171 112.00$ ($59)-$ $30 $ 201.53
1,205 -$ -$ $ -
-$ -$ $ -
Construction & Demolition -$ -$ $ -
1,198per permit890.334 1.000 224$ $145 $369 238.00$ ($131)32,623$ $21,063 ($11,560)$65 $ 433.57 $38,371
1,200per permit180.334 0.250 93$ $61 $154 80.00$ ($74)2,725$ $1,416 ($1,309)$27 $ 181.05 $3,205
1,199per permit710.334 0.500 137$ $89 $225 212.00$ ($13)15,965$ $15,010 ($955)$40 $ 265.23 $18,778
-$ -$ $ -
-$ $ -
3,165$ $1,131 ($2,034)$14 $ 95.46 $3,723
-$ $14 $ 95.46
139,694$ $156,032 $16,338 $15 $ 96.88 $164,310
1,353$ $10 ($1,343)$12 $ 79.55 $1,591
-$ $12 $ 79.55
135$ $10 ($125)$12 $ 79.55 $159
110,444$ $1,633 ($108,811)$12 $ 79.55 $129,906
2,908$ $215 ($2,693)$12 $ 79.55 $3,421
879$ $299 ($580)$12 $ 79.55 $1,034
2,705$ $120 ($2,585)$12 $ 79.55 $3,182
72,534$ $409,622 $337,089 $0.003 $ 0.0229 $85,315
135$ $10 ($125)$12 $ 79.55 $159
-$ $ -
487$ $80 ($407)$43 $ 286.38 $573
15,583$ $2,304 ($13,279)$21 $ 143.19 $18,328
1,785$ $319 ($1,466)$29 $ 190.92 $2,100
1,758$ $130 ($1,628)$12 $ 79.55 $2,068
10,077$ $8,344 ($1,733)$12 $ 79.55 $11,853
-$ $12 $ 79.55
-$ $ -
-$ $ -
Capital Accounting Partners Page 8 of 14 BldCostCalcs
Palo Alto Building Dept
Building Fees
Service
# If
Any
Fee Name
1,232 Commercial (Level 1 and 2)
1,233 Commercial (Level 1 and 2) - each additional station
1,233 Commercial (Level 3 and 4)
1,234 Commercial (Level 3 and 4) - each additional station
1,231 Residential (level 1 & 2)
Residential (level 3)
Electrical Permits - Photovoltaic Systems
Residential System (less than 10 kw)
1,242 Residential System (greater than 10 kw)
1,243 Commercial System (less than 10 kW)
1,244 Commercial System (10kW - 49kW)
1,245 Commercial System (greater than 49kW)
MECHANICAL PERMITS
Swimming Pool Heather
1,254 Admin base fee
Mechanical new or remodel cost/SF
1a
1b Furnaces
1c
1d
2 Appliance vents: installation, relocation or replacement of…
3 Repairs, alteration or addition of each heating appliance…
Boilers, Compressors, and Absorption Systems:
4a
Up to and including 3 HP, absorption system up to and including
100,000 Btu/h
4b
Up to and including 15HP, absorption system exceeding 100,000
Btu/h and including 500,000 Btu/h
4c
Up to and including 15-30HP, absorption system exceeding 500,000
Btu/h and including 1,000,000 Btu/h
4d
Up to and including 30-50HP, absorption system exceeding
1,000,000 Btu/h and including 1,750,000 Btu/h
4e Greater than50HP, absorption system exceeding 1,750,000 Btu/h
5 Air handlers up to and including 10,000 cf per cfm…
Ventilation and exhaust:
7a Each ventilation FAC connect to a single duct
7b
Each ventilation system that is not a portion of a heating or air-
conditioning system …
7c
Installation of each hood that is served by mechanical exhaust,
including the ducts of such hood
Miscellaneous
9
Each appliance or piece of equipment regulated by this code, but
not classed in other appliance categories for which no other fee is
listed in this table
Full Gas Piping
10a Each gas piping system of 1-5 outlets
10b Each additional gas piping system per outlet
Process Piping
11a Each hazardous process piping system 1-4 outlets
11b Each hazardous process piping system >5 outlets
11c Each nonhazardous process piping system of 1-4 outlets
Annual Revenue
Revenue at Full Cost of
Services
Projection of
Revenues at
Current Fees
Annual Surplus
(subsidy)
R
e
q
u
i
6 Months Reserve,
3 yr build up Full Cost / Unit With Reserves
Annual Cost Calculations w/o Reserves Reserve Requirements
6,501$ $6,290 ($211)
5,850$ $7,308 $1,458 $13 $ 87.10 $6,881
464$ $560 $96 $82 $ 545.24 $545
-$ $16 $ 106.78
9,579$ $9,120 ($459)$30 $ 197.66 $11,266
-$ $42 $ 277.29
-$ $ -
10,307$ ($10,307)$14 $ 95.46 $12,123
-$ $39,497 $39,497 $ 304.35
-$ $95 $ 631.53
2,416$ $2,550 $134 $142 $ 947.29 $2,842
873$ $900 $27 $154 $ 1,026.84 $1,027
1,493$ $644 ($849)$11 $ 76.37 $1,756
84,096$ $93,932 $9,836 $15 $ 96.88 $98,915
51,268$ $289,531 $238,263 $0 $ 0.02 $60,303
-$ $ -
15,939$ ($15,939)$29 $ 191.30 $18,748
-$ $ 0.32
-$ $ -
-$ $10 $ 64.02
-$ $10 $ 64.02
-$ $ -
-$ $19 $ 127.66
9,334$ $2,408 ($6,926)$19 $ 127.66 $10,979
-$ $19 $ 127.66
-$ $29 $ 191.30
-$ $29 $ 191.30
-$ $10 $ 64.02
-$ $ -
4,137$ $836 ($3,301)$10 $ 64.02 $4,866
-$ $10 $ 64.02
109$ $56 ($53)$10 $ 63.96 $128
-$ $ -
-$ $10
$ 63.96
-$ $ -
391$ $112 ($279)$17 $ 114.87 $459
-$ $10 $ 63.64
-$ $ -
-$
-$ $10 $ 63.64
-$ $23 $ 153.05
Capital Accounting Partners Page 9 of 14 BldCostCalcs
Palo Alto Building Dept
Building Fees
Service
# If
Any
Fee Name
11d Each NPP piping system of >5 outlets, per outlet
PLUMBING PERMITS - GRAY WATER SYSTEMS
1,266 Admin base fee
1 For each plumbing fixture on one trap or set of fixtures..
2 For each building sewer and each trailer park sewer
3 Rainwater system - per drain (inside building)
4 For each private sewage disposal system
6 For each water heater, vent, or both
7 For each gas piping system of one to five outlets
8 For each additional gas piping system outlet, per outlet
9
Industrial waste pretreatment interceptor, including trap and vent, X
kitchen-type grease interceptors
10
Installation, alteration or repair of water piping, water treatment
equip or both
11 Repair or alteration of drainage or vent piping, each fixture
12
Lawn sprinkler system on one meter including backflow protection
devices
13A Atmospheric-type vacuum breakers not referenced above (1-5)
13B Atmospheric-type vacuum breakers not referenced above (>5)
14 Backflow protective device other than atmospheric-type (any size)
Plumbing Permits - Graywater Systems
1,271 Clothes washer System
1,273 Complex System
1,272 Simple System
16 Installation and testing for a reclaimed water system
17 Annual cross-connection testing of reclaimed water system…
18 Each medical gas piping system 1-5 outlets
Additional medical gas inlet(s)
Electrical new or remodel cost/SF
Solar hot water system
1,190 Storm drain system
1,191 Swimming pool
Use & occupancy Permits
1,187 Certificate of Use and Occupancy
1,188 Certificate of Use and Occupancy - Replacement
1,189
1,186
Temporary Occupancy Permit - Multi-Family Residential, Non-
Residential, and Other Commercial
1,185
Temporary Occupancy Permit - Single Family Residential and
Commercial Tenant Improvement less than 10,000 sq. ft.
FIRE FEES
Hazardous Materials Classification Permits
1,367 Compressed Gas
1,363 Corrosives
1,364 Cryogenic Fluid
1,365 Flammable and Combustible Liquids
1,368 Flammable Gas
1,366 Flammable Solids
1,373 Health Hazard (Liquids & Solids)
Annual Revenue
Revenue at Full Cost of
Services
Projection of
Revenues at
Current Fees
Annual Surplus
(subsidy)
R
e
q
u
i
6 Months Reserve,
3 yr build up Full Cost / Unit With Reserves
Annual Cost Calculations w/o Reserves Reserve Requirements
-$ $23 $ 153.05
107,900$ $120,520 $12,620 $15 $ 96.88 $126,914
-$ $14 $ 95.46
1,953$ $420 ($1,533)$23 $ 153.12 $2,297
5,356$ $330 ($5,026)$14 $ 95.46 $6,300
15,621$ $1,320 ($14,301)$23 $ 153.12 $18,374
5,454$ $280 ($5,174)$17 $ 114.55 $6,415
27,659$ ($27,659)$34 $ 229.10 $32,533
-$ $710 $710 $ 48.70
-$ $34 $ 229.10
97$ $5 ($92)$17 $ 114.55 $115
1,299$ $448 ($851)$14 $ 95.46 $1,527
-$ $14 $ 95.46
-$ $17 $ 114.55
-$ $14 $ 95.46
15,193$ $390 ($14,803)$34 $ 229.10 $17,870
-$ $ -
-$ $14 $ 95.46
195$ $88 ($107)$34 $ 229.10 $229
243$ $183 ($60)$14 $ 95.46 $286
-$ $34 $ 229.10
-$ $69 $ 458.21
-$ $34 $ 229.10
Additional medical gas inlet(s)0.25 25$ $16 $41 -$ ($41)-$ $7 $ 47.73
Electrical new or remodel cost/SF2,127,2360.00012 0.012$ 0.008$ 0.02$ 0.11$ $0 41,435$ $233,996 $192,561 $0 $ 0.02 $48,736
Solar hot water system1.2 118.187$ 76.594$ 194.78$ 224.00$ $29 -$ $34 $ 229.10
1,190Storm drain system1.2 118$ $77 $195 28.00$ ($167)-$ $34 $ 229.10
1,191Swimming pool 0.4 39$ $26 $65 28.00$ ($37)-$ $11 $ 76.37
Use & occupancy Permits
1,187Certificate of Use and Occupancyeach1552.5 456$ $296 $752 287.00$ ($465)116,569$ $44,485 ($72,084)$133 $ 884.58 $137,109
1,188Certificate of Use and Occupancy - Replacementeach0.5 94$ $61 $155 123.00$ ($32)-$ $27 $ 182.64
1,189 -$ -$ $ -
1,186each332.3 365$ $237 $602 896.00$ $294 19,876$ $29,568 $9,692 $106 $ 708.43 $23,378
1,185each1551.7 270$ $175 $445 375.00$ ($70)69,003$ $58,125 ($10,878)$78 $ 523.62 $81,162
-$ -$ $ -
FIRE FEES
Hazardous Materials Classification Permits -$ -$
1,367Compressed Gasannually281 229$ $121 $350 139.00$ ($211)9,795$ ($9,795)$62 $ 411.45 $11,521
1,363Corrosivesannually541 229$ $121 $350 139.00$ ($211)18,890$ ($18,890)$62 $ 411.45 $22,219
1,364Cryogenic Fluidannually421 229$ $121 $350 139.00$ ($211)14,692$ ($14,692)$62 $411 $17,281
1,365Flammable and Combustible Liquidsannually1721 229$ $121 $350 139.00$ ($211)60,168$ ($60,168)$62 $411 $70,770
1,368Flammable Gasannually281 229$ $121 $350 139.00$ ($211)9,795$ ($9,795)$62 $411 $11,521
1,366Flammable Solidsannually1 229$ $121 $350 139.00$ ($211)-$ $62 $411
1,373Health Hazard (Liquids & Solids)annually331 229$ $121 $350 139.00$ ($211)11,544$ ($11,544)$62 $ 411.45 $13,578
Capital Accounting Partners Page 10 of 14 BldCostCalcs
Palo Alto Building Dept
Building Fees
Service
# If
Any
Fee Name
1,381 Liquefied Petroleum Gases
1,354 Organic Coatings
1,374 Organic Peroxides
1,355 Ovens - Industrial Baking or Drying
1,375 Oxidizers (Liquids & Solids)
1,369 Oxidizing Gas
1,356 Parade Float
1,357 Place of Public Assembly
1,370 Pyrophoric Gas
1,376 Pyrophoric Materials (Liquids & Solids)
1,358 Pyrotechnical Special Effects Material
1,377 Radioactive Materials
1,359 Refrigeration Equipment
1,360 Spraying/Dipping
1,361
Tent or air-supported structure having an area in excess of 200
square feet; or canopies in excess of 400 square feet (includes a
public assembly permit of $125.00 for all tents)
1,362 Tire Recapping/Tire Storage
1,371 Toxic, Highly Toxic, Moderately Toxic, Health Hazard Gas
1,378 Toxic, Highly Toxic, Moderately Toxic, Health Hazard Materials
1,372 Unstable Reactive Gas
1,379 Unstable Reactive Materials (Liquids & Solids)
1,380 Water Reactive Materials (Liquids & Solids)
Hazardouis Materials County Reimbursement
Hazardous Materials Storage Permits
1,311
Additional Approvals for Hazardous Materials Storage Permit (first 2
hours)
1,312
Additional Approvals for Hazardous Materials Storage Permit (per
hour for time above 2 hours)
1,308 Business Plan (HMBP)
1,312 Late Fee for Hazardous Materials Storage Permit
1,305 Level I Facility
1,306 Level II Facility
1,307 Level III Facility
1,309 Petroleum Aboveground Storage Tank
1,310 Provisional (6 Month)
Fire Inspection Fees
1,313
Additional Resinspection Fee (up to 2 hours during normal business
hours)
1,313 Additional Resinspection Fee (each additional hour)
1,314 After Hours Inspection Fee
Annual Revenue
Revenue at Full Cost of
Services
Projection of
Revenues at
Current Fees
Annual Surplus
(subsidy)
R
e
q
u
i
6 Months Reserve,
3 yr build up Full Cost / Unit With Reserves
Annual Cost Calculations w/o Reserves Reserve Requirements
1,381Liquefied Petroleum Gasesannually101 229$ $121 $350 139.00$ ($211)3,498$ ($3,498)$62 $ 411.45 $4,115
1,354Organic Coatingsannually1 229$ $121 $350 175.00$ ($175)-$ $62 $ 411.45
1,374Organic Peroxidesannually11 229$ $121 $350 139.00$ ($211)350$ ($350)$62 $ 411.45 $411
1,355Ovens - Industrial Baking or Dryingannually41 229$ $121 $350 102.00$ ($248)1,399$ ($1,399)$62 $ 411.45 $1,646
1,375Oxidizers (Liquids & Solids)annually161 229$ $121 $350 139.00$ ($211)5,597$ ($5,597)$62 $ 411.45 $6,583
1,369Oxidizing Gasannually341 229$ $121 $350 139.00$ ($211)11,894$ ($11,894)$62 $411 $13,989
1,356Parade Floatper hour1 229$ $121 $350 115.00$ ($235)-$ $62 $411
1,357Place of Public Assembly per occurrence2 457$ $242 $700 236.00$ ($464)-$ $123 $823
1,370Pyrophoric Gasannually11 229$ $121 $350 139.00$ ($211)350$ ($350)$62 $411 $411
1,376Pyrophoric Materials (Liquids & Solids)annually41 229$ $121 $350 139.00$ ($211)1,399$ ($1,399)$62 $411 $1,646
-$ $62 $411
9,795$ ($9,795)$62 $411 $11,521
-$ $62 $411
5,947$ ($5,947)$62 $411 $6,995
-$ $131 $872
-$ $246 $1,642
1,371Toxic, Highly Toxic, Moderately Toxic, Health Hazard Gasannually111 229$ $121 $350 139.00$ ($211)3,848$ ($3,848)$62 $411 $4,526
13,293$ ($13,293)$62 $411 $15,635
350$ ($350)$62 $411 $411
-$ $62 $411
-$ $62 $411
-$ $62 $411
-$ $348,000 $348,000
-$
-$ $134 $892
-$ $87 $583
115,990$ ($115,990)$87 $583 $136,429
-$
1,305Level I Facility811 229$ $121 $350 264.00$ ($86)28,335$ ($28,335)$62 $411 $33,328
83,256$ ($83,256)$123 $823 $97,926
267,257$ ($267,257)$247 $1,646 $314,351
18,190$ ($18,190)$123 $823 $21,396
-$ $123 $823
-$ -$
-$ -$
-$
104,687$ ($104,687)$123 $821 $123,134
-$ $61 $410
-$ $92 $616
Capital Accounting Partners Page 11 of 14 BldCostCalcs
Palo Alto Building Dept
Building Fees
Service
# If
Any
Fee Name
1,316 Care Facility
1,317 Care Facility Inspection Including Fire Clearance (greater than 25
Care Facility Inspection Including Fire Clearance (7-25 clients)
1,315 Christmas Tree Lot/Pumpkin Patch
1,321 High Rise Building - Certificate of Compliance (annually up to 4
1,322 High Rise Building - Certificate of Compliance (each additional hour))
1,318 Outside Cooking Booths
1,320 Standby Fire Watch or After Hours at Fire or Incident Scene
1,319 Use and Occupancy Fire Inspection
As-Built Plan Check and Additional Work
Investigations & Consultations
1,325 Additional Hours Over Plan Review/Inspection
1,323 Alternate Means and Methods Application
1,324 Appeals to Decisions
1,322 Consultation Fee
1,328 Hazardous Materials Data Entry Fee
1,327 Hydrant Flow Fee
1,326 Site Disaster Planning
Life Safety & Fire Protection
1294A Automatic Fire Sprinkler Installation/Modification > 19 heads
1,295 Automatic Fire Sprinkler Installation/Modification (plus per head)
1,301 Express Fire Protection Plan Check Fee
1,296 Fire Alarm System Installation and Modification
1,297
Fire Alarm System Installation and Modification (plus a device or
contact point)
1,303
Fire Protection and Fire Access Plan Review for New Single Family
Dwellings or Additions
1,298 Hydrant Installation/Modification - Private
1,295 Other Automatic Fire Extinguishing System
1,297 Standpipe System - Wet, Dry, or Combination
1,300 Temporary Certificate of Occupancy
1,299 Underground Fire Service Line
1,304 Verification of Fire Protection System Maintenance and Certification
Food truck permits
Multifamily dwellings, hotels & motels
4-50 units
51-100 units
Greater than 100 units
Fire Prevention Inspection of Private Schools
1294B Automatic Fire Sprinkler Installation/Modification > 19 heads
Specific Hazard Permits
1,329 Aerosol Products
1,330 Amusement Buildings
Annual Revenue
Revenue at Full Cost of
Services
Projection of
Revenues at
Current Fees
Annual Surplus
(subsidy)
R
e
q
u
i
6 Months Reserve,
3 yr build up Full Cost / Unit With Reserves
Annual Cost Calculations w/o Reserves Reserve Requirements
-$
-$ $123 $821
-$ $61 $410
-$ $61 $410
-$ $256 $1,710
-$ $61 $410
-$ $92 $616
-$ $61 $410
54,088$ $22,940 ($31,148)$61 $410 $63,619
52,344$ ($52,344)$123 $821 $61,567
-$
-$
-$ $49 $325
49,242$ ($49,242)$116 $772 $57,919
-$ $61 $410
165,755$ $78,850 ($86,905)$61 $410 $194,963
-$
26,172$ ($26,172)$61 $410 $30,784
-$ $61 $410
-$
-$
-$ $272 $1,813
-$ $1 $4
-$
-$ $172 $1,146
-$ $4 $25
-$ $141 $941
-$ $31 $205
-$ $172 $1,146
17,448$ ($17,448)$123 $821 $20,522
-$ $133 $889
250,817$ ($250,817)$295 $1,967 $295,015
-$ $14 $92
-$ $31 $205
-$
-$ $61 $410
-$ $698
-$ $184 $1,231
-$ $123 $821
-$ $123 $821
-$
-$ $77 $513
-$
Capital Accounting Partners Page 12 of 14 BldCostCalcs
Palo Alto Building Dept
Building Fees
Service
# If
Any
Fee Name
1,331 Automobile Wrecking Yard or Junk Yard
1,332 Bowling Alley and Pin Refinishing Involving the use of Flammable
1,333 Candles and Open Flames in Assembly Areas
1,334 Carnivals and Fairs
1,335 Cellulose Nitrate Storage/Nitrate Film
1,337 Combustible Fiber/Material Storage
1,336 Confined Space
1,338 Hot Work permit fee (one time permit)
1,339 Hot Work permit fee (monthly permit)
1,340
1,341 Fireworks Display
1,342 High-piled Combustible Storage
1,343 Hot Work (Welding) Operations
1,349 Liquid or Gas-Fueled Powered Equipment
1,344 Liquid or Gas-Fueled Vehicles or Equipment in Assembly Buildings
1,350 Magnesium Working
1,345 Malls - Covered
1,351 Occupant Load Increase - Temporary Public Assembly
1,352 Open Burning
1,348 Open Flame/Flame Producing Devices
1,353 Operate a Tank Vehicle to Transport Flammable/Combustible
1,347 Place of Public Assembly - Temporary
1,346 Temporary Kiosks
Fire Miscellaneous Fees
TCO fee for Vendors/Stock occupancy (Requires at least one
additional inspection)
1,288 Emergency Response Fee - Hazmat (PAMC 17.24.050)
1,289 Installation or Closure Without Approved Plans and/or Permits
Fire plans revision
Building General & Miscellaneous Fees
1,176 All Other Publications
1,201 Construction/Maintenance Vehicles
1,172 Electric Service and Safety Inspection
1,181 Extension of Building Permit or Building Permit Application
1,174
Inspections and Investigations - Outside Normal Business Hours
(1.5xOThour)
1,175
Inspections and Investigations - Outside Normal Business Hours
(2.0xOThour)
1,173 Inspections and Investigations - Unclassified
1,184 Reactivation of Expired Building Permit - All Others
1,183 Reactivation of Expired Building Permit - Final Inspection Only
1,182 Reactivation of Expired Building Permit Application
1,178 Real Property Research Fee (1-hour minimum)
1,177 Records Retention
1,180 Reinspection Fee - Multi-Family Residential and Non-Residential
1,179
Reinspection Fee - Single Family Residential (each secondary
inspection type)
Annual Revenue
Revenue at Full Cost of
Services
Projection of
Revenues at
Current Fees
Annual Surplus
(subsidy)
R
e
q
u
i
6 Months Reserve,
3 yr build up Full Cost / Unit With Reserves
Annual Cost Calculations w/o Reserves Reserve Requirements
-$
-$ $179 $1,197
-$ $61 $410
-$ $256 $1,710
-$ $18 $120
-$
-$
1,338Hot Work permit fee (one time permit)One time1 228$ $121 $349 126.00$ ($223)-$ $61 $410
-$
-$
-$
-$
-$
-$ $61 $410
-$
-$
-$ $123 $821
-$ $61 $410
-$ $61 $410
-$ $61 $410
-$ $87 $582
-$ $61 $410
-$
-$
-$
287,438$ ($287,438)$203 $1,352 $338,088
-$ $61 $410
-$
-$
-$
-$
-$
1,172Electric Service and Safety Inspectionper hour1 98$ $52 $151 84.00$ ($67)-$ $27 $177
2,656$ $1,736 ($920)$15 $101 $3,124
365$ $202 ($163)$64 $429 $429
25,274$ $11,752 ($13,522)$86 $572 $29,727
-$ $43 $286
4,325$ ($4,325)$40 $268 $5,087
4,049$ $6,000 $1,951 $45 $298 $4,762
3,023$ $2,688 ($335)$33 $222 $3,556
-$ $43 $286
118,656$ $80,936 ($37,720)$1 $7 $139,564
562$ $616 $54 $50 $331 $661
3,086$ $1,176 ($1,910)$220 $3,086 $43,200
Capital Accounting Partners Page 13 of 14 BldCostCalcs
Palo Alto Building Dept
Building Fees
Service
# If
Any
Fee Name
1,180
Reinspection Fee - Single Family Residential (each primary
inspection type)
1,171 Request for Release of Building Plans
1,175 Residential Inspection Guidelines
Conditional Utility Agreement
Emergency Responder Radio Coverage (testing) fee.
GREEN BUILDING FEES
Bldg
Alterations and additions for single and multifamily < 1,000 sq ft and
increases conditioned space
Bldg Alterations and additions for single and multifamily > 1,000 sq ft
Bldg Multi Family New Construction of 3 or More (attached) Units
Bldg Multi Family New Construction of < 4
Bldg New Single family
Bldg
Tenant improvements, renovations, or alterations > 5,000 sq ft that
includes replacement or alteration of
at least two of the following: HVAC system, building envelope, hot
water system, or lighting
system and project value greater than $200,000.
Bldg
C. Tenant improvements, renovations or alterations > $200,000 in
valuation (and not triggered by a Calgreen Tier)
Bldg
If the project is over $100,000 Energy Star is required after 12
months of occupancy
Bldg New commercial 1000 - 25,000 SF
Bldg New commercial 25,001-50,000 SF
Bldg New commercial >50,000 SF
Bldg Landscape Review - plan review
Bldg Landscape Review - inspection
Bldg Landscape Review - plan review
Bldg Landscape Review - inspection
Bldg Landscape Review - plan review
Bldg Landscape Review - inspection
Bldg
Fee # 325
Annual Revenue
Revenue at Full Cost of
Services
Projection of
Revenues at
Current Fees
Annual Surplus
(subsidy)
R
e
q
u
i
6 Months Reserve,
3 yr build up Full Cost / Unit With Reserves
Annual Cost Calculations w/o Reserves Reserve Requirements
-$ $50 $331
-$ $13 $90
-$
44,292$ $47,124 $2,832 $42 $279 $52,097
15,631$ ($15,631)$110 $735 $18,386
108,626$ $67,023 ($41,603)$193 $1,291 $127,767
204,545$ $28,718 ($175,827)$217 $1,449 $240,588
6,032$ $2,672 ($3,360)$266 $1,774 $7,095
-$ $218 $1,456
9,611$ $11,809 $2,198 $242 $1,615 $11,305
51,271$ $32,028 ($19,243)$266 $1,774 $60,305
51,997$ $14,868 ($37,129)$218 $1,456 $61,160
-$ $123 $821
37,336$ $30,303 ($7,033)$313 $2,091 $43,915
-$ $361 $2,409
-$ $385 $2,567
87,160$ ($87,160)$256 $1,709 $102,519
13,091$ ($13,091)$38 $257 $15,397
71,516$ ($71,516)$158 $1,051 $84,118
17,454$ ($17,454)$38 $257 $20,530
14,527$ ($14,527)$256 $1,709 $17,087
2,182$ ($2,182)$38 $257 $2,566
-$
-$
Annual Revenue
Impact
Revenue at Full Cost of
Services
Projection of
Revenues at
Current Fees
Annual Surplus
(subsidy)With Reserves
13,096,098$ 11,308,113$ ($1,787,985)$15,435,720
Annual Revenue Impacts
Capital Accounting Partners Page 14 of 14 BldCostCalcs