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the update. Applicants would continue to pay the $3,000 fee and would not receive any refund of this fee should their use be changed to permitted through the update process. However, the Council can choose not to take action on the CUP fee at this time and elect to revisit it as part of the update instead. Ms. Wagner presented the staff recommendation, which is that the Council approves by resolution the Master Fee Schedule for development related services. These fees would be increased for inflation annually starting January 1, 2017 and reviewed and updated on a biannual basis going forward. Councilmember Pentin asked and Ms. Wagner confirmed that the annual fee adjustment (based on the Construction Cost Index) would apply to all 200 fees, excluding those based on valuation. Mayor Thorne asked and staff confirmed that the Council could also elect to agendize a discussion on and perhaps amendment of these fees at any other time. Mr. Dolan noted that the Construction Cost Index does not always increase. In instances where it actually decreases, the city's fees would follow suit. Ms. Wagner thanked the staff who worked with her to prepare the study and subsequent recommendations. Vice Mayor Brown said she has commonly heard that businesses generates approximately 60% of General Fund revenues while residents generate about 40 %, yet during the Audit Committee meetings Ms. Wagner indicated more of a 50/50 split. Ms. Wagner explained property tax is the single largest revenue generator, with 2/3 of property tax revenues coming from residential property. She further explained that sales tax serves as the true dividing factor. In the State of California sales tax is allocated to municipalities based on the business' location, which could make the argument that sales tax revenue is generated by businesses. However, if it were not for Pleasanton's 72,000 residents spending their money in the City, the revenue would not exist. While it can be somewhat of a tossup, more neutral fiscal consultants would tend to split the credit for sales tax revenue and it is that assumption that leads to the 50/50 split she has referred to. Vice Mayor Brown commented that in the Engineering department which was at a 22% cost recovery rate, the remaining 78% was being subsidized by General Fund monies that otherwise could have been used to support parks and other community development projects. She also noted that while the city's fiscal policy is full cost recovery, these fee updates still fall fairly short of that at 79 %. Councilmember Olson noted that he too served on the Audit Committee. He said he was also concerned about the proposed CUP fee increase, assuming it takes a year to complete the code update. Councilmember Pentin asked how Pleasanton's 60/40 or even 50/50 split stacks up against other communities, acknowledging that some are really just bedroom communities with very little in the way of business revenues. Ms. Wagner said there is no question that many bedroom communities probably credit residential taxes and fees with something like 90% of their revenue. In the late 1970s prior to the mall and Hacienda Business Park, Pleasanton was in that same type of situation. At that time the General Fund did not have the excess funding needed to support heavy uptake in development and therefore created the policy that development should pay 100% of its costs. Mr. Fialho stressed that he did not wish for the takeaway to be that the city is minimizing the business community's contributions. These contributions come in the form of assessed valuations, new development fees and even sales tax from business to business transactions. Staff is simply City Council Minutes Page 7 of 18 June 16, 2015