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Council approves 3.3% CPI adjustment and 2.7% credit‑card surcharge; defers new general‑plan and tech fees
Summary
The council voted 5–2 to adopt the staff proposal to increase most user and regulatory fees by the prior‑year CPI (3.3%) and to add a 2.7% credit card transaction surcharge, while postponing proposed general‑plan and technology enhancement fees for further study.
The Costa Mesa City Council voted on Tuesday to adopt an interim update to user and regulatory fees, implementing a 3.3% inflation adjustment for most service fees and adding a 2.7% surcharge for credit‑card payments processed by the city.
ClearSource consultant Terry Madsen presented staff’s recommendation to apply the prior year regional Consumer Price Index to many building, planning and engineering fees as an interim measure, while reserving a comprehensive fee study for later. Staff also proposed three new charges: a credit‑card transaction pass‑through (2.7%), a general‑plan update fee and a technology‑enhancement fee, both proposed at 5% for applicable development permits.
At the Financial and Investment Policy Advisory Committee (FIPAC) meeting and during council discussion, commissioners and council members expressed concern that adding a general‑plan or technology fee could be perceived as discouraging development even though similar fees exist in other Orange County cities. After discussion and a substitute motion, council voted to adopt the CPI update and the credit‑card surcharge only; the broader fees will be studied further and staff was directed to return with additional analysis.
Councilmember Manuel Chavez moved the staff recommendation. A substitute motion by Councilmember Arliss Reynolds narrowed the action to the CPI adjustment and the credit‑card fee and added direction to staff to explore accepting additional card types (e.g., American Express) and to solicit Parks and Community Services Commission input about program and facility rental fee structures. The substitute motion passed 5–2, with Councilmembers Andrea Marr and Lauren Gumeros voting no.
Finance staff estimated the CPI and credit‑card adjustments would yield roughly $380,000 in additional annual revenues; the full package that included the two new development fees would have produced a larger increase (staff estimated about $750,000 if all proposed changes were adopted).
The council also asked staff to return during the coming fiscal year with a comprehensive cost‑recovery study for a wider range of fees, and to consult the Parks and Community Services Commission on possible sliding‑scale or equity‑based charges for recreational programs.
