A4
                             ADMINISTRATIVE REPORT

                                            Date: October 8, 1996

    TO:       Vancouver City Council

    FROM:     Director of Finance and
              Director of Permits & Licenses

    SUBJECT:  1997 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, including
              maintaining licence fees at the 1993 level.

         B.   THAT the Director of Legal Services be instructed to amend
              the Licences and Pound By-laws accordingly, to be effective
              January 1, 1997.

    GENERAL MANAGERS' COMMENTS

         The General Managers of Community Services and Corporate Services
         RECOMMEND approval of A and B.

    COUNCIL POLICY

    Council, on January 17, 1991, resolved:

         THAT every department/board review services for which fees
         are now charged to ensure full cost recovery, or that fees
         are equivalent to competitive charges where the fee is of a
         market nature.


    PURPOSE

    The purpose of this report is to recommend changes to fees under the
    Licence and Pound By-laws which will have the effect of increasing
    Pound revenues by approximately 2% in 1997.

    DISCUSSION

    It is Council policy that the Pound operation be self-supporting.  As
    described in Table 1, the Pound has failed to reach break-even in
    recent years.


                           Table 1: Pound Operations
                           Revenues and Expenditures
                            Revenues     Expenditures      Recovery
                              ($)             ($)            (%)

              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
              1995          563,272         711,340           79

            % change
             1988-95           8%             29%

          1996 (budget)     560,000         696,600           80


    The Director of Finance and the Director of Permits & Licenses
    recommended in 1994 and 1995 that there be no change in dog licence
    fees to ensure that fees would:

    -    not be so high as to be a deterrent for dog owners to licence
         their pets, and

    -    be similar to other municipalities (see Appendix II).

    A review of operating data of the Pound (see Appendix III) would
    indicate that stabilizing dog licence fees has had a positive effect on
    the sale of dog licences.  Moreover, increases in impoundment fees had
    shifted the burden of costs to those who fail to comply with the
    By-law.  The overall effect has been higher revenue at the Pound.

    Given the long term deficit in operations it is unlikely that the Pound
    will reach cost recovery through increases in dog licence fees. 
    However, the Director of Permits & Licences does not support
    expenditure reduction as this would mean staffing cuts and a consequent
    deterioration of enforcement services.

    LOWER MAINLAND POUND OPERATIONS

    Dog licence fees within the Lower Mainland have increased nominally in
    recent years, and range from $10 to $59.  There are two classifications
    under which dog licences are sold, open or altered (spayed/neutered)
    dogs.  Dog licence fees for altered dogs are substantially lower than
    for open dogs in an effort to encourage the control of the dog
    population (see Appendix II).  Most municipalities keep increases to
    dog licence fees to the rate of inflation or lower.

    Pound operations throughout the Lower Mainland have dog licence fees
    that vary considerably.  Typically the fee is set to try to recover the
    costs of operating the Pound, while not becoming prohibitive to dog
    owners.  Labour is the most substantial operating cost.  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.

    Discussions with various municipal representatives indicates that the
    number of dog licences sold relates closely to enforcement and
    communication initiatives such as sending out notices to individuals
    that had a dog licensed in the previous year.

    1997 POUND FEES

    It is expected that the deficit in Pound operations for 1996 will be
    approximately $136,000, down from $148,000 in 1995.  A large reason for
    this has been a steady increase in the number of dog licences sold. 
    The sale of dog licences has increased by over 900 licences in the last
    two years and now accounts for 80% of revenues at the Pound.  Overall,
    revenues have increased significantly, up by 14% since 1993.

    The applicable licence and impoundment fees proposed for 1997 are
    outlined in Table 2 and detailed in Appendix I.  They are similar to
    last year's fee increases, and impoundment fees will increase by $5 -
    $10 depending on whether it is a first offence or vicious dog.

    The fee schedule outlined in Table 2 will not bring the Pound operation
    to a position of cost recovery, as any attempt to raise fees to cost
    recovery levels will require a 25% increase on all fees.  This will
    result in fees that are considered too high when compared to other
    municipalities and people's willingness or ability to pay.  The
    negative consequence could be lower revenues.  Through public
    education, effective notification and other efforts revenues at the
    Pound can be enhanced on an incremental basis with changes to
    impoundment fees.


                       Table 2: Pound Operations
                     Current and 1997 Proposed Fees

         License Fees           Current           1997 Proposed

         Male/Female              $44                  $44
       After March 1st            $54                  $54

       Spayed/Neutered            $24                  $24
       After March 1st            $34                  $34

       Replacement Tag             $5                  $5




                   Table 2 (Cont'd): Pound Operations
                     Current and 1997 Proposed Fees

       Impoundment Fees         Current           1997 Proposed
        Unlicensed Dog            $126                $131
      (plus license fee)

        Licensed Dog:
            First                 $65                  $70
            Second                $90                 $100
          Additional              $125                $135

         Vicious Dog              $250                $260

    The proposed fee increases will generate an additional 2% in revenues
    at the Pound, as shown in Table 3.


                   Table 3: 1997 Pound Operations
                  Impact of Proposed Fee Increases

                                1996                1997
                               Current            Proposed

          Revenues             560,000            575,000
        *Expenditures          696,600            711,000

           Deficit             136,600            136,000

        Cost Recovery            80%                81%

    *    Excludes any provision for Department or City overhead costs.

    CONCLUSION

    Based on anticipated increases in Pound operating costs in 1997,
    impoundment and other fees should be increased to raise an additional
    2% in revenue at the Pound and avoid an increase in the overall deficit
    for Pound operations.  The schedule for 1997 Pound fees is provided for
    in Appendix I.


                 *     *     *     *     *