Sustainability: Hueneme, San Diego

Oxnard Harbor Commissioners are adamantly opposing Measure M, a ballot initiative that would impose a city business license tax increase targeted at businesses operating at the Port of Hueneme and Naval Base Ventura County. San Diego’s Board of Port Commissioners has amended the port’s Cost Recovery Policy and User Fee Schedule as part of continuing efforts to refine the recently adopted program, implement efficiencies and facilitate a better user experience.

San Diego’s Board of Port Commissioners has amended the port’s Cost Recovery Policy and User Fee Schedule as part of continuing efforts to refine the recently adopted program, implement efficiencies and facilitate a better user experience.

The Cost Recovery policy was adopted in 2013 as part of efforts to ensure that the port adequately recovers costs for the services it provides that benefit businesses, individuals or entities as opposed to the public. Cost recovery through user fees is a best management practice in government recommended by the Government Finance Officers Association and mandated by the port’s enabling statute as a component of fiscal stewardship. 

At the time the policy was adopted, the port committed to ongoing review and modification as warranted. Since implementation began, the port has sought and received substantial feedback from stakeholders, including members of the port business community, which enabled staff to propose various refinements. In April 2014, the board amended the user fee schedule to cap initial deposit amounts to reduce upfront costs for development applicants and simplify the service agreement. At that time, the board also directed staff to explore waivers and other improvements to the policy.

At that April meeting in April, Board Chairman Bob Nelson formed a Cost Recovery Ad Hoc Committee to consider further refinements to the program. Based on the work of the Ad Hoc Committee, staff recommended the following additional revisions, which the board adopted on August 12:

• Cost Recovery User Fees may be waived for certain 501 (c) (3) nonprofit organizations, port-sponsored events, port security and operational projects, scientific research projects, other public agencies that set up reciprocal agreements or a specific finance agreement, and projects initiated or requested by the port.
• A $50 sublease fee has been eliminated to minimize impacts on tenants with short-term subleases.
• A bundle fee for routine level services has been established to support businesses, especially small businesses, and facilitate tenant improvement projects.
• Stormwater inspection fees have been eliminated to encourage compliance. Rather than charging fees for routine annual inspections, the port will seek to recover costs from non-compliant businesses. This approach supports the port’s effort to manage common resources in a sustainable way and to continue to improve water quality in San Diego Bay.

At the August 12 meeting, the board directed staff to continue analyzing the cost recovery program for procedures that could bring additional efficiencies. The board discussed the port’s two distinct roles: landlord, as well as regulatory and land-use authority. The board directed staff to review the distinction between these roles and how they relate to user fees. The board also directed staff to gather information about how other agencies with dual roles approach user fees.