TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Javier Carcamo, Finance Director
PREPARED BY: Ashley Lopez, Accounting Supervisor
SUBJECT:
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Public Hearing for Fiscal Year 2026/27 Citywide User Fee Schedule Update
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ABSTRACT
This report provides an overview of the City’s Citywide User Fee Schedule Update for Fiscal Year (FY) 2026/27. It is a best financial management practice for local governments to review and update their User Fee Schedules annually. The Fiscal Year 2026/27 Citywide User Fee Schedule Update incorporates the annual Consumer Price Index (CPI) adjustment and reflects department-submitted revisions to ensure fees remain accurate and cost-reflective. This update aligns fees with current service delivery costs and operational needs. The resulting schedule supports transparent, consistent, and fiscally responsible fee practices across the City of Murrieta.
RECOMMENDATION
recommendation
Conduct a Public Hearing to consider proposed updates to the City’s User Fee Schedule; and
Adopt Resolution No. 26-4924 entitled: A Resolution of the City Council of the City of Murrieta, California, Approving and Adopting the City’s Updated User Fee Schedule for Fiscal Year 2026/27.
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PRIOR ACTION/VOTE
On February 7, 2023, a workshop was held to present the proposed Citywide User Fee Update. The City Council provided direction to staff regarding the updated Citywide fee structure to be incorporated for adoption at a future City Council meeting.
On March 21, 2023, the City Council adopted Resolution No. 23-4653, adopting the Fiscal Year 2023/24 User Fee Schedule and an annual update of fees at the lesser of the Consumer Price Index (CPI) or 5% (Vote 4-1).
On May 7, 2024, the City Council conducted the first reading of Ordinance No. 603-24, adopting the Fiscal Year 2024/25 User Fee Schedule (Vote 4-1).
On June 4, 2024, the City Council conducted the second reading and adopted Ordinance No. 603-24, adopting the Fiscal Year 2024/25 User Fee Schedule (Vote 5-0).
On April 1, 2025, the City Council adopted Resolution No. 25-4819 entitled: A Resolution of the City Council of the City of Murrieta, California, Approving the City’s Updated User Fee Schedule for Fiscal Year 2025/26 (Vote 3-1).
STRATEGIC ALIGNMENT
The City Council’s goal of maintaining a high performing organization that values fiscal sustainability, transparency, accountability and organizational efficiency is associated with this administrative priority.
DISCUSSION
History
In October 2021, the City of Murrieta (City) contracted with Willdan Financial Services to conduct a Comprehensive User Fee Study and prepare a full Cost Allocation Plan to assist the City in determining appropriate fee levels for the various services provided by the City. It is considered a best financial management practice for local governments to review and update their User Fee Schedules periodically. A workshop was held on February 7, 2023, to present the results of the User Fee Study and gather input from the public and the City Council. The report and presentation focused on the study's purpose, process, methodology, policy considerations, and recommended User Fee adjustments. Based on the City Council's and public feedback, staff updated the fee recommendations. On March 21, 2023, the City held a public hearing after staff presented the User Fee Study, and the Fiscal Year 2023/24 User Fee Schedule (Fee Schedule) was adopted by the City Council.
Historically, the City of Murrieta updated and adopted its Fee Schedule for City services every year. However, due to staffing constraints, the Fee Schedule was not updated between January 16, 2018, and March 21, 2023, resulting in larger-than-normal increases when the City updated the Fee Schedule in 2023. Because of this, the adopted resolution stated that the City would adjust fees each year based on the Bureau of Labor Statistics Consumer Price Index (CPI) for the Riverside-San Bernardino-Ontario area using the year-over-year percentage change from March to March, or five percent (5%), whichever is lower. Beginning with the Fiscal Year 2024/25 Fee Schedule update, the City Council directed staff to use the January-to-January CPI to align fee implementation with the start of the fiscal year (July 1). As a best practice, the City will perform a full User Fee Study every five years. This is the third CPI adjustment that the City has made to the Fee Schedule and the fourth year since the most recent User Fee Study.
Ordinance No. 603-24, Attachment 4, provides the legal framework allowing the City to update fees by resolution where permitted by state law.
Fee Schedule Changes
Below are descriptions of the recommended changes to the Fee Schedule:
• Consumer Price Index
The year-over-year CPI for the Riverside-San Bernardino-Ontario area (January-to-January) was released on February 13, 2026, at 3.2%. The U.S. Bureau of Labor Statistics news release information is included in this report as Attachment 3. The proposed Fee Schedule is included as Exhibit A of Resolution No. 26-4924 to this report. Attachment 2 provides details of the dollar and percentage change for each proposed fee. All fees have been adjusted for the 3.2% CPI change, unless they are statutory fees imposed by the Municipal Code, the State, or other County agencies and cannot be increased.
• Discontinuation of the Penny
On November 12, 2025, the U.S. Mint officially ended production of the penny. While the penny remains an acceptable form of payment, its circulation is expected to decline. Accordingly, staff proposes rounding fees that can be paid in cash to the nearest five-cent increment. Engineering, Fire, and Development Services fees will continue to be rounded to the nearest one-cent, as those fees are not accepted in cash and rounding these fees would require manual updates to over 900 fees, annually, whereas CPI adjustments can currently be applied system-wide through the permitting software.
• Other Changes
Other changes to the Fee Schedule, along with the reasons for these changes, are summarized in Exhibit B to Resolution No. 26-4924. These changes include administrative updates such as revisions to verbiage, removal of duplicative fees, and clarification of fee descriptions. Staff also proposes adding updated hourly rates for new position classifications.
For the Fire Department, staff proposes adding an Expedited Plan Check fee, comparable to an existing Building and Safety fee, and adding a new Truck Company standby fee for the ladder truck.
For the Police Department, the Civil Subpoena Deposit will be updated to remain consistent with Government Code section 68097.2(b). For the Municipal Services Department, staff proposes increasing the Electric Vehicle Charging rate above CPI to more accurately recover actual costs.
• Fees Set by Other Agencies
The Fee Schedule includes current fees set by the State of California, the County of Riverside, and other external agencies. The City collects and remits these fees to the respective agencies as mandated. These fees will not change as part of this proceeding.
• Downtown Application Fee Reduction Program
The Downtown Application Fee Reduction Program, established by Resolution No. 18-3910 in 2018, provides a fee reduction for certain development applications for projects within the Downtown Murrieta Specific Plan. Ordinance No. 603-24 maintained this program. The proposed Resolution No. 26-4924 will continue this program.
• Town Square Park Fees
The previously adopted Town Square Park fees that were in the Fiscal Year 2025-2026 User Fee Schedule have been omitted from this fee update. Fee updates for Town Square Park will be brought to Council as a separate item on April 21, 2026.
The Fee Schedule included as Exhibit A to Resolution No. 26-4924 reflects these factors listed above.
PUBLIC NOTICING
The agenda for this meeting was posted at least 72 hours in advance in accordance with the Brown Act. A public notice was published in the Press-Enterprise, Daily Bulletin, and San Bernardino Sun newspaper on March 23, 2026, and made available for public review on March 23, 2026. The City Clerk’s Department notified interested parties with an active notice on file.
CEQA AND REGULATORY OVERVIEW
This action is exempt from the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because this action will not result in a physical change to the environment, directly or indirectly.
FISCAL IMPACT
The anticipated cumulative revenue impact of the proposed changes is approximately $263,089 for Fiscal Year 2026/27, depending on the level of service activities provided. It is important to note that adjusting the Fee Schedule will have a fiscal impact in the form of additional revenue. The additional revenue is not intended to fund new services; rather, the revenue is intended to offset the costs of providing existing services that are recoverable from fees. Consequently, while fees may rise annually, labor and contract services costs (the primary driver of fee-related costs) also increase annually. Recalibrating these fees provides an offset of existing expenditures/needs rather than a source of funding for expanded service levels.
ATTACHMENTS
ATT 1 - Resolution No. 26-4924
ATT 2 - FY 2026/27 Fee Dollar Amount Changes
ATT 3 - U.S. Bureau of Labor Statistics CPI January-to-January 2026 News Release
ATT 4 - Ordinance No. 603-24