San Francisco City Hall

As the budget crisis continues to unfold, the city of San Francisco is faced with finding ever-more-creative ways to bring in revenue.

This month the city tacked on 20 cents to the cost of a pack of cigarettes. The new fee will help supplement the Department of Public Works’s recently cut street cleaning budget.

Next up? A soda fee, charged to businesses selling sugary drinks, followed by congestion pricing, a fee charged to commuters during rush hour.

Already, swimmers, travelers and ambulance riders are among those paying for the more than $117 million in new fees and fee increases this year.

San Francisco brought in an average of $58 million per year through fees between 2005 and 2007. However, in the past two years that number has jumped to $113 million in 2008 and $117 million in 2009.

Because of the state’s inability to raise taxes without a two-thirds majority vote, local municipalities are forced to hunt for extra revenue where they can. “All cities in California have become heavily reliant on fees,” said Greg Wagner, the mayor’s budget director.

Unlike taxes, new fees can be legislated in without voter approval.

Even outside of California, cash-strapped cities have become increasingly creative in finding ways to boost the bottom line. Chicago, for example, recently introduced a vomit fee that would charge intoxicated passengers $50 for becoming ill while riding in a taxi.

For its part, San Francisco started looking into the soda fee after a study from the University of California revealed that the consumption of sugary beverages is a large part of the $41 billion California pays annually for health problems related to obesity.

Wagner said plans are underway to introduce the fee “very soon.”

Of the 67 new fees and fee increases that were proposed over the past two years, fees related to the Municipal Transportation Agency saw the largest increase.  The agency has brought in an additional $66 million in the past two years from a number of different fees including parking meters, traffic fines and a Muni fare increase of 50 cents per adult passenger.

Flying got more expensive too. The San Francisco International Airport saw its fees go up by over $28 million in 2008, or 33 percent more than the year prior. It’s unclear how much of this will be passed on to passengers.

Water and sewage fees were also raised by nearly $43 million over the past two years as part of an effort to recoup the $4.6 billion cost from retrofitting and upgrading the city’s water system. The increase cost an average of $53 per San Francisco resident in 2008.

Other increases this year and last include $3.7 million for emergency medical services, $2.3 million for vector control and healthy house inspections, and $180,000 in fee increases at local swimming pools, among many others.

Mission Pool employee Oscar Rosas said they “expect to see as much as a 15-percent drop in patronage because of the increase,” which raised admission from $4 to $5.

The new 20-cent Cigarette Litter Abatement Fee—effective Oct. 1—will bring an additional $5 million to the Department of Public Works this year. After a city audit revealed that cigarette trash accounts for more than 26 percent of all litter found on the street, the city decided to pass the cost on to smokers by raising the price of cigarettes.

By law the city can use revenue collected from fees only to recoup the cost of that service. So city departments routinely conduct cost analysis reports to determine where the city is losing money. The Mayor then takes those figures into account when creating his annual budget, and decides whether to pass that cost on to the public.

It’s unclear what the reaction to the soda fee will be. In the past, San Francisco has been sued for imposing fees on particular products. Such was the case with the plastic bag fee, leading to its eventual ban in 2007.

The Mayor’s office is also looking into implementing congestion pricing–a fee charged to drivers who pass through certain parts of the city during rush hour. A similar fee is already in effect in cities in Asia and Europe and is currently being tested in Seattle, Chicago, Minneapolis, Miami and the Bay Area.

In a recent speech, Mayor Gavin Newsom called congestion pricing “the single greatest step we can take to protect our environment and improve our quality of life.”

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Born and raised in Seal Beach, California, Heather Duthie studied Political Science and Community Studies as an undergraduate. She went on to work on a number of documentary films and for Link Television. She has lived in the Mission District for the past 5 years, and currently covers government for Mission Loc@l.

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  1. And re: Public Schools, most of the public schools that are any good at all are already “charging” what you might call “user fees” — in the form of fundraising through the school PTA. For example, the better public schools have very active PTAs that raise hundreds of thousands of dollars (e.g., Clarendon, Alvarado, Grattan, etc) to pay for additional teachers to keep down class size, pay for librarians, PE insturctors, art teachers, music teachers, etc. And that’s the real difference between a good SF School and a bad one — how much money the PTA can raise to supplement the meager funds provided by the school district. So we already are charged “user fees” for public schools in any public schools that are worth going to.

  2. Transfer from the poor to the rich? Sorry, but the “poor” are the ones using most of the city’s expensive services — including free homeless services (housing, medical food, etc), free medical care to the poor and indigent (i.e., non-paid visits to SF General), free homeless (drunk) ambulance trips, free “back-door” muni rides, free drug treatment services, free immigrant services, etc. etc. and much of that money is coming from the “rich” property owners in the form of property taxes, property tax additional assesments, transfer tax, etc — and don’t forget, that rich people pay sales tax too.

  3. the bigger story here is that this is part of the ongoing wealth transfer from the poor to the rich. cities need money to provide services, that’s just a fact. so if they can’t tax us to get the money, they go to user fees. but who uses things like MUNI and public pools? that’s right — the poor, now forced to pay more of the cost of the services while the rich enjoy low taxes. what’s next? user fees for public schools?

  4. i love how that person says its hearsay when you site your sources and then doesn’t come back to respond to your defense. i thought this article was very interesting! it is understandable that cities need to make money somehow but it seems a little excessinve…what exactly is the reasoning behind the swimming pool fee?

  5. This story is about the fact that fees have gone up in the city. The information came directly from the city controller’s office and the mayor’s office, and I’ve provided links to the documents I used in my research–so, what do you think is hearsay?

  6. What’s the difference between blogs and the Chronicle? Nothing. This blog is a perfect example of someone writing and essentially not having a clue about what they’re talking about. Here say is not news.