ADMINISTRATIVE REPORT
Date: October 13, 1995
TO: Vancouver City Council
FROM: Director of Finance and the Director of Permits and
Licenses
SUBJECT: 1996 Pound Fee Review
RECOMMENDATION
A. THAT Council approve adjustments to the licence, impoundment
and other fees in the Licence and Pound By-laws as outlined in
this report and detailed in Appendix I.
B. THAT the Director of Legal Services be instructed to amend the
Licences and Pound By-Laws accordingly, to be effective
January 1, 1996.
GENERAL MANAGERS COMMENTS
The General Managers of Corporate and Community Services
RECOMMEND approval of A and B above.
COUNCIL POLICY
Council, on January 17, 1991, resolved:
"THAT every department/Board review services for which fees are now
charged to ensure that fees are recovering the full cost of the
services to the City, or are equivalent to competitive charges
where the fee is of a market nature, rather than for cost
recovery."
PURPOSE
This report details recommendations for the 1996 Pound fees.
It is proposed to increase Pound fees so that anticipated overall
revenues at the Pound will rise by approximately 2% in 1996. At the
recommendation of the Director of Permits and Licenses and the Director
of Finance, dog licence fees will not be increased in 1996. Impoundment
and other fees will be increased to levels proposed by the Pound to more
appropriately allocate costs to those dog owners that create the need
for enforcement.
DISCUSSION
It is Council policy that the Pound operation be self-supporting.
Despite increased licence and impoundment fees, the Pound has failed to
reach break-even in recent years, as Table 1 illustrates. From a high of
96% cost recovery in 1985, the level of cost recovery declined to 69% in
1991. Recently, in light of stable revenues and expenditures, Pound
revenues provide for approximately 76% cost recovery.
Table 1: Pound Operations
Revenues and Expenditures
Revenues Expenditures Recovery
1987 $ 516,762 $ 550,718 94%
1988 520,295 551,243 94%
1989 510,214 560,612 91%
1990 498,884 585,275 85%
1991 477,086 692,655 69%
1992 500,589 647,249 77%
1993 505,253 712,966 71%
1994 532,339 658,217 81%
% change
1987-1994 3% 20% --
1995 (budget) 535,000 699,100 76%
In response to a steady 2% annual decline in the number of dog licences
sold in recent years, a number of initiatives have been investigated to
encourage dog owners to license pets and to generate higher revenues and
thus enhance cost recovery at the Pound. Until 1992, dog licence fees
had been increased in line with expenditure inflation at the Pound,
however, a steady decline in the number of licences sold has more than
offset the impact of these fee increases. In 1992, licence fees were
held at 1991 levels.
In 1994, Council made additional changes, introducing a pre-payment
discount incentive of $10 to those dog owners who purchase licences
before March 1.
Council held licence and impoundment fees steady in 1995 and it is
expected that licence sales will exceed 1994 levels by a small amount.
Currently, a committee chaired by the City Clerk and comprised of City
Councillors, Parks Board Commissioners, and Pound and Permits and
Licenses staff have been meeting to address enforcement issues related
to the Pound. This group has been reviewing dog licence fees, pound
staffing, doggie parks and other related issues. The goal is to develop
ideas that will make the Pound enforcement more effective and to
minimize the negative impacts some dogs are creating in the City parks
and on the beaches. It is anticipated that some recommendations for
change will be made in 1996 which may include future directions for
setting the dog licence fees.
Pending the outcome of this process, it is recommended that licence fees
not be increased in 1996, with the aim of encouraging more dog owners to
purchase dog licences. Cost recovery will be enhanced through fee
increases to impoundment and other enforcement related fees.
LOWER MAINLAND POUND OPERATIONS
Outside the City of Vancouver, licence and impoundment fees within the
Lower Mainland have increased only minimally in recent years, and range
from $10 to $20. All municipalities have favoured a system of high
impoundment fees to shift the cost to those who create the need for
enforcement.
It should be noted that the total number of staff at each Pound ranges
between 4 - 19 full and part time staff. Currently, Vancouver employs
11 full-time and 8 part-time staff. A 1995 comparison of Lower Mainland
operations is included in Appendix II.
Some municipalities have taken the position that an increase in dog
licence fees will result in a decrease of dog licences sold. However,
West Vancouver, Surrey, New Westminster, and Richmond have not increased
fees over the last three years with little change in dog licences sold,
as Table 2 illustrates.
Discussions with various municipal representatives indicates that the
number of dog licences sold relates closely to various enforcement and
licensing initiatives such as sending out notices to individuals that
had a dog licensed in the previous year.
Table 2: Change in Dog Licences Sold
Where Municipality Did Not Increase Licence Fee
1992 / 1994
Dog Licences Sold
1992 1994
New Westminster 1,800 1,912 (+6%)
Richmond 3,517 3,708 (+5%)
Surrey 9,000 8,020 (-11%)
West Vancouver 2,473 2,222 (-11%)
1996 POUND FEES
At present, the deficit in Pound operation is about $165,000, equal to
25% of total expenditures. Reducing this shortfall closer to Council
policy of cost recovery would require either significant fee increases
or a reduction in Pound operating costs. The Director of Permits and
Licenses does not support expenditure reduction as this would mean
staffing cuts and a consequent deterioration of enforcement services.
Table 3 illustrates the distribution of revenues among the various
sources related to Pound operations in 1994. It is clear that revenue
from licence fees is the most significant revenue source. Approximately
62% of dog licence sales in 1994 were sold before March 1st, at a $10
discount.
Table 3: 1994 Pound Operations
Sources of Revenue
Dog Licences 79 %
Impoundment Fees 17 %
Other (i.e., cremations) 4 %
Total 100%
Based on the distribution of revenue sources, it is apparent that only
significant increases in licence fees may generate sufficient additional
revenues to reduce the current shortfall position.
The Directors of Finance and Permits and Licences recognize that licence
fees should not be perceived by dog owners as a deterrant to purchasing
a licence. It is recommended that the 1996 dog licence fees not be
increased in 1996, pending the findings and recommendations of the
review committee mentioned earlier. At the recommendation of the Pound,
impoundment and other service related fees will be increased,
recognizing that the fees were last adjusted in 1994.
The applicable licence and impoundment fees are outlined in Table 4 and
detailed in Appendix I.
Table 4: Pound Operations
Current and 1996 Proposed Fees
Current 1996 Proposed
Licence Fees:
Male/Female $44 $44
After March 1st $54 $54
Spayed/Neutered $24 $24
After March 1st $34 $34
Replacement Tag $5 $5
Impoundment Fees:
Unlicenced dog $119 $126
(plus licence fee)
Licenced dog:
First $57 $65
Second $80 $90
Additional $119 $125
Vicious dog: $237 $250
The fees proposed in this report will increase revenues by approximately
2%. The overall impact of the proposed fee increases on Pound operations
is presented in Table 5.
Table 5 does not take into consideration the possibility that more dog
licences may be sold in 1996, as a result of not increasing dog licence
fees.
Table 5: 1996 Pound Operations
Impact of Proposed Fee Increases
1995 1996
Current Proposed
Revenues $ 535,000 $ 545,000
Expenditures* 699,100 703,784
Deficit (164,100) (158,784)
Cost Recovery 76% 77%
* Excludes any provision for Department or City overhead costs.
CONCLUSION
Based on anticipated increases in Pound operating costs in 1996,
impoundment and other fees should be increased to raise an additional 2%
in revenue at the Pound. The schedule for 1996 Pound fees are detailed
in Appendix I.
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