Laguna Beach staff recommend raising most council appeal fees to $4,500; public warns increases could silence neighbors

Laguna Beach city staff on Tuesday presented a study-session review of proposed community development fee changes that would move many fees toward full cost recovery and recommended raising most city appeal fees from the current $2,500 to $4,500, with annual CPI adjustments. Staff said fees approved at a public hearing on April 28 would become effective July 1, 2026.

The recommendation, explained by Matt Schneider, the city’s director of community development, was framed as a compromise between the current $2,500 appeal fee and the consultant-estimated full cost recovery amount of roughly $7,000. Schneider said the council retains the ability to refund an appeal fee if it later finds abuse of discretion.

Why it matters: The proposed shift to greater cost recovery affects 87 separate fees across community development. Staff told the council that about 17 fees would see no change, 30 would rise up to 12 percent, 26 would increase 30–50 percent, six would rise between 31–100 percent and eight would more than double if moved to 100 percent cost recovery. Staff estimated the general-fund subsidy reduction could be substantial and said they will supply exact fiscal impacts at the April hearing.

Public commenters pushed back. Kain, speaking for Village Laguna, said the 152 percent jump for some appeal-related fees amounted to a “pay-to-play barrier” that would “silence the community” and urged shifting noticing costs back to applicants and creating processes for architects to mediate neighbor concerns before appeals. Penelopey Milton, identified as president of a local group, urged the council to adopt a two-tiered fee or waiver system so that affected neighbors and community organizations are not priced out; she cited other California cities that charge nominal or reduced fees to non-applicants.

Architect Morris Gandarian asked staff to explain how the consultant allocated costs — which employees are included, whether attorney and public-works time are counted, and whether noticing costs would be folded into the new fees. Local designer James Henry criticized relying on the 2021 study, saying community development was then “in the worst state it had ever been,” and urged staff to account for streamlining and efficiency improvements before imposing full-cost increases.

Staff answered several procedural questions and noted alternatives the council could consider, including a deposit/billing model, tiered fees tied to the number of plan-check iterations, and fee waivers or reduced rates for non-applicants. Michelle Banigan, director of administrative services, said staff would prepare comparisons to other jurisdictions, an updated subsidy estimate, and an analysis of how forthcoming efficiency and code reforms might lower staff hours and therefore fees.

Key figures and details: current appeal fee $2,500; consultant full-cost estimate near $7,000; staff-recommended general appeal fee $4,500; two appeal exceptions proposed at lower amounts (transcript records a tree removal permit appeal fee shown as $1,17 and a hedge-height appeal shown as $3,048); staff reported roughly 350 discretionary approvals annually and about 14 appeals (under 1 percent of actions).

What the council asked for next: Councilmembers directed staff to return at the April 28 public hearing with comparative fees from peer jurisdictions, the estimated annual subsidy avoided by proposed increases, a breakdown of appeal frequency and outcomes, and alternative fee models (applicant vs. non-applicant rates, waiver criteria, and tiered fees based on review count). Staff also noted the city’s forthcoming efficiency ordinance and code updates could change the fee calculations.

The study session closed with staff committing to return with the requested information and options; no formal fee changes were adopted at the meeting. The council then adjourned to closed session.