On June 23, 2014, Council approved the Interlocal Cooperative Agreement establishing the Regional Business License and Permits program for the City of Sparks, the City of Reno, Washoe County and Washoe County Health District in an amount not to exceed $448,542.52 for the initial system investment, including a 5.5% funding for project changes, authorized the initial annual operational licensing fee of $37,030.87, and direction to staff to return prior to the go-live date with a regional technology fee to recover portions of the project cost.

On February 22, 2016, Council approved a change order  to extend the contract with Accela through the new go-live date of August 22, 2016.

The new regional license and permit platform will replace the current programs.  The key advantages of the new system allows customers to apply, renew, and pay on-line for licenses and/or permits.  Customers will still be able to submit license and/or permit applications in person at a jurisdiction;  however, the on-line capacity should provide substantial time and cost savings for our customers.  Customers will also have the ability to track the status of their applications on-line and submit electronic documents associated their application.

On July 11, 2016, Council adopted the Business Impact Statement for the Regional License and Permit Platform finding the proposed Regional Technology Fee does not have a significant business impact.

The first reading of this bill was conducted during the August 8, 2016 City Council meeting.

The proposed regional technology fee is to aid in the recovery of the capital outlay costs for the platform.  The capital outlay costs include one-time project implementation costs and a 5.5% project contingency component.  Additionally, the proposed regional technology fee is to recover the required annual subscription costs.  The subscription costs commenced on the date the contract was signed with Accela (June 17, 2014).  Lastly, the proposed regional technology fee is to provide funds for future technology needs associated with the platform.

The Interlocal Cooperative Agreement includes a provision related to the regional technology fee (entities refer to the City of Sparks, the City of Reno, the Washoe County Health District, and Washoe County):

Section 12.2    A “regional technology fee” may be imposed by the initial ENTITIES upon their customers utilizing the PLATFORM for a minimum of one year, commencing upon go live of the PLATFORM. The “regional technology fee” shall be consistent among the ENTITIES and shall include the following: business permits – 4%; annual business license - $4; quarterly business license - $2.

The proposed regional technology fee for the City of Sparks is as follows:

1. For all business licenses at time of license application and for each license renewal:
   1. $4 for annual licenses;  and,
   2. $2 for quarterly licenses (collected each calendar quarter).
2. 0% of the total permit cost for all other permits, to include permit renewal.

The anticipated revenue collected from the regional technology fee for the City of Sparks General Revenue fund is as follows:

The capital outlay for the City of Sparks is $411,512 and the annual subscription cost is $37,031.  The General Fund was allocated 39% and the Business Enterprise Fund was allocated 61% of the cost.  The proposed regional technology fee  anticipated revenue may recover the costs of the General Fund capital outlay and annual subscription fees in the 10^th year or 2025.

The Business Enterprise Fund was able to absorb its allocation of the capital outlay and annual subscription fee.  Staff recommends 0% technology fee for permits at this time.

Specific types of licenses will be exempted when calculating the regional technology fee.  The Customer Service division will determine the exempted licenses and exempted permit fees.  Some examples include:

• Gaming license fees as these fees are established and controlled through NRS.
• Electric energy service license fees and telecommunication services license fees as these fees are authorized and established within NRS.

Based on input from trade associations and businesses, staff recommends that the proposed regional technology fee take effect when the platform is launched for use by citizens on August 22, 2016.  The trade associations were specific in requesting that the fee be charged when citizens have the ability to apply for licenses and permits on-line.

NRS 237.100 requires the City to provide a procedure for an aggrieved business to object to a rule adopted pursuant to NRS 237.030 through 237.100 inclusive.  This is the requirement for adoption of a business impact statement.  Any business such aggrieved must file a petition with the Board within 30 days of the date the rule to adopt the regional technology fee.  This means that any petition must be filed before August 10, 2016.  Staff recommends that any petition be in writing and filed with the County Clerk as required by NRS 237.100(4).  The Board is required to determine the merits of any petition if so filed, and may amend the fee based on the petition.

The City Council could chose to not approve this ordinance and provide direction to staff.

I move to adopt Bill No. 2708 to amend Chapter 5 of Sparks Municipal Code to provide for the assessment of the Regional Technology Fee for the Regional Business License and Permit Platform.