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Engineering Division The Engineering Division is responsible for overseeing the project development, design, survey, inspection and contract administration for all public improvements including the City's capital improvement program and private improvements (other than the building improvements which are inspected by the Building and Safety Division). The total budgeted cost of all engineering services is $4,859,426, of which $1,319,817 is fee related. The City currently recovers approximately $295,000 (22%) of these costs through user fees with a General Fund subsidy of $1,024,817. A cost recovery level of 22% is low for engineering services statewide. Staff recommends full cost recovery (approximately 100%) for this area. However, the actual fees are received upfront in a project's development and the services are provided over an eighteen (18) to thirty-six (36) month period. Therefore, for calculating annual revenues a more realistic cost recovery rate is 43% ($567,521). The only fee that would not be 100% cost recovery is the wide load permits. This fee is set by State law and is not 100% cost recovery. The division is also recommending restructuring many of its map fee categories to consolidate the fee schedule and make it more user- friendly. Improvement plan checking represents a large portion of the subsidy in this division. Improvement plan checking includes review, modification and approval of the construction plans for both on-site and off-site public and private improvements such as roads, curbs, gutters, utilities (water, sewer, gas and electric), storm drains, street lighting, traffic improvements, and other appurtenances. In 1992 when the last fee increase was contemplated, the plan was to resolve an inconsistency that exists in the City's Master Fee Schedule; however, as indicated earlier, due to the economic downturn at that time the fee increases were not implemented. The current fee schedule includes a fee for engineering services related only to off-site public improvements equal to 2% of the value of these improvements; however, it does not have a fee for improvement plan checking for all the remaining improvements. Off-site public improvements are a small portion of the on-site and off-site public and private improvements related to a project. Therefore, the fee should be charged for all on-site and off-site private and public improvements related to a project. The recommended fee schedule proposes to correct this inconsistency in the Master Fee Schedule. By doing this, a majority of the subsidy by the General Fund to this division is further reduced. Fire Prevention Fire Prevention services are provided by the Livermore-Pleasanton Fire Department (LPFD). The total cost of all fire prevention services provided by LPFD to Pleasanton entities is approximately $14 million. The total cost of fee-related services is approximately $1,104,770. The City's current fee revenue totals approximately $62,500 for a cost recovery rate of 5%. Currently a majority of this revenue is collected for new construction and tenant improvements, while annual fire inspections are provided free of charge. It is important to note that almost all of the jurisdictions in California charge fees for annual fire inspections, including Livermore. PRM worked with Livermore to develop their fee structure for fire inspection services provided by LPFD. The fees were adopted by the Livermore City Council in May 2008. The proposal is to have the same fire inspection fee schedule that Livermore adopted. This is because the same services are Page 5of10