06/03/1991 Park Board Packet - Laserfiche WebLink

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G =7 1_. c _ i om Ci -..-`_- �' S Wi_u:G, VV..O Ci ✓_ Ci.l 'r ...i .ent pi 1e rgoo iS a,:d JerV1 t' i/ie.•e can be directly ass:" ed to Individuals. �.. :s L C that such serv:. S c3� 11d an'ii-_Ig:lt t0 Cc prC:'_ G the :v e s., �r. c t . ,e user fee s,1rs e 1 �: I :d.V u al is ying" SeiV:CCS frog: a purl..,. Ve. a the sam,3 way 1-:e would from a private one. he theory as to what goods should be provided the public and private sectors is relatively underdl�vclopcd. Quite often services are provided by cities because i.ey always have been. Gt er services are provided because it is less costly and more efficient Lo have a single purvey: r 'than several. P'.nother reason r..ay be t`;e desire of the community to require a certain level of eG sumption of a service, such as police protection, by ail, its members. As a result, their purchase of the The second requirement for a service to be financed by users' fee is that nonpayers must be excluded from the benefits of the service. If. those unwilling or unable to pay the fee are, allowed to avail themselves of the service two results will occur. First, the service will be overused. Second, no rational individual will pay the fee if he can get the service for nothing. In many cases those t people who ., do notpay the, fees can not be restricted'from using the service. ': The - city street system is, an example. .In other cases the cost; of excluding nonpayers..is _ so high that fees are impractical: . Nonpayers'-could be 'excluded from using. a city park by erection of a fence and posting of guards. But the., cost of excluding ' nonpayers could be ;greater than the fees collected Examples and Applications Probablythe one type of ,public service for which fees" are set"'. nth" the, least.. regard for the; principles mentioned,above"is municipally operated utilities. Often such" fees " are set on a per unit basis, such as front footage jor water, pr sewers... Electricity should be metered and the fee set on the amount used. Water also should be. meteredand since "sewage. disposal is directly correlated to water usage both fees can be set on water ... 5...._.,�; .iOr: tie :tr: Cr i:i5}iOS�:: ;1..._„ .. sic to c arse all users _::e Sa..: `.ia.:.)...5 'LO rt.Jta::i-,.SerS a iC t:. �....�:..:s :J SL - J.Y js- C:O LV aril :j Sta;-Gas in o _.eatcrent rs. 1hlis -o can solved by 6! <cre 1L ws .i.crcas'e as l:le �is�� ticreases. �he practice of gra: tin" cuan :ty 4 �Cv ' S for wa..,r and electricity Sh Gina` li:, iirscon i::L'e:l. Water a La electricity plants are built to supply aea.'c de:Nand. it were not for these peaks which occur it .-cquently, e costs of larger plans could be avoided. 'et it Is at ti... s of weak demand when prices s`_.oulAube ti.e hrghest that t:�ey are the lowest. For example, city water plants usually are built so that water is available during the summer rnonths when there is a great deal of seasonal demand for cooling systems and watering of lawns. Yet most water rates are set so that the rate falls for this extra consumption. A second area where fees are usually set in an irrational fashion is the area of streets and highways. Usually streets and highways are available at no charge to users. This amounts to a considerable subsidy to travel by car and puts urban mass transit facilities at a competitive price disadvantage. Charging tolls would encourage the use of alternative means of transportation. The toll not only reduces the general tax burden but cuts the costs associated with urban congestion and pollution. Consideration must also be given, to the use of peak " time pricing. - Auniform toll for all times of 'day is " almost as much economic. nonsense as no toll at all '.._ Charging ,a higher toll. during 'periods when`, demand is .; the greatest tends �ta even.`'out' the traffic flow over the day.. A single.toll or no toll encourages the construction of roads designed "-for `, peak capacity 'which ' are under-utilized the vast majority of the time. Police and fire protection are other areas where user fees 'should be charged..- Fire protection fees can,; be set on the : basis.: of : the value " of the structure as modified - by the','Jikelihood . of combustion.,' - information is accurately, conveyed, in the fire insurance premium paid.:. _The users' fee would beset on' the (Continued`on page 243) Z 4•i L Ak l d fi 0 az4� i" July, i972