Consultants tell Ithaca council full cost recovery unlikely; recommend standardized fee sheets, targeted hikes and expanded transparency

Kieran Bazilla, a senior associate with CGR (the Center for Governmental Research), told the Ithaca Common Council on Sept. 16 that the city’s municipal fee structure is large and fragmented and that “full cost recovery is unlikely on many fees.” The consultant presented a compiled spreadsheet of the city’s fees, a standardized method to calculate costs and a set of recommendations for centralizing and regularizing fee-setting in the annual budget process.

The study identified roughly 500 fee lines across departments and recommended that the city require departments to complete a fee template showing units, transactions, staff time and related overhead so officials can judge cost recovery more accurately. Bazilla said some departments — notably the clerk’s office — reported substantial staff time would be required to complete the templates.

Why it matters: City leaders told the council the city lacks a single, consistently updated inventory of fees. That makes it harder for the public and elected officials to see who pays, which fees subsidize public benefits, and where increases would be most equitable. The study’s recommended tools would let the council review fees as part of the annual budget rather than in multiple, ad hoc steps.

Key findings and examples - Scale and process: The study lists roughly 500 discrete fee entries (the display CGR prepared runs to more than 600 rows with department breakdowns) and found inconsistent processes, multiple platforms for transactions and “diffuse responsibility” for setting fees. Bazilla said many fees have not been updated in years. - Subsidies: CGR proposed a two-part test for subsidizing fees: whether the fee delivers a public/community benefit and whether participants are price-sensitive. If both are true, a subsidy is likely warranted. - Dog licenses: CGR used the SPCA contract (approximately $60,000 a year) and 2024 license data (about 600 licenses) to illustrate limits of cost recovery. The consultant calculated license revenue of roughly $9,000 — about 15% of the SPCA contract — and said a full cost-recovery license would be about $100, which the report called “exorbitant” for public acceptance. CGR recommended modest fee increases and public education to boost compliance rather than a single large increase. - Parking and garages: Parking staff recommended modest parking-hour increases (staff suggested raising garage and street rates toward $2 an hour and $12 daily for garages), a graduated overtime meter penalty, demand-based pricing in high-use areas and enforcing two-hour limits downtown to free spaces. - Water and sewer: CGR advised the city to study a revised rate methodology that more closely tracks usage (billing per 1,000 gallons rather than a 9,000-gallon lump) but warned such changes will shift costs among users — for example, multiunit buildings on a single meter — and the utility lacks the detailed meter-level data today to do a targeted, progressive change. - Trash tags: The city manager reported the administration will include a $1 increase to the per-bag trash tag in the manager’s proposed budget to keep tag revenue better aligned with rising collection and tipping costs. The manager said the administration plans to make longer‑term tags “forever tags” to ease transitions.

Process recommendations and next steps: CGR urged centralizing fee review in the annual budget process, inventorying the city code’s fee-authorizing provisions, and considering limited, regularized increases tied to inflation. The consultant also recommended departments produce brief written rationales when they seek a change larger than inflation.

Council reaction and concerns: Council members asked about differentiating city residents from non-residents for facility uses (golf course, youth programs and Stewart Park), enforcement practicality (e.g., dog-license compliance), and equity impacts for fees that affect low-income households. Several members urged caution on raising rates that could reduce program participation. The clerk and department staff flagged the administrative time needed to complete CGR’s templates and suggested the city phase the work by department.

Decision vs. discussion: The meeting recorded no formal vote changing fees; the presentation was informational. The city manager said staff will work with departments to complete templates on a department-by-department schedule and consider some fee changes for the coming budget; the trash-tag increase was the only change the administration said it had already integrated into its proposed budget.

Ending: The council directed staff to return with the compiled fee schedule and suggested specific areas for follow-up (parking, water/sewer methodology, and community-resident vs. nonresident distinctions). The consultant’s full report and the fee templates will be used to guide departmental work and the council’s review during the 2026 budget process.