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REDWOOD CITY FAIR AND AFFORDABLE HOUSING ORDINANCE
<br />Economic & Planning Systems, Inc. 44 Impact on City Finances
<br />Table 16. Annual Program Administration Cost
<br />31 The fully burdened cost rates used in the initial report are based on the City’s current cost recovery methodology and include the
<br />full complement of benefit costs, including pension costs. Consistent with best practices, the City should re-evaluate its cost
<br />recovery model periodically, which the City intends to do in preparation for the FY 2027-28 budget process.
<br />32 As noted above, the City's adopted FY 2026–2027 budget includes a projected deficit of more than $12 million. According to staff,
<br />there is no guarantee that the City would be able to fully recover all start-up costs associated with implementing the program. Any
<br />unrecovered costs would place additional pressure on the City's already constrained financial outlook.
<br />Minimum Average Maximum
<br />Annual Administration Cost
<br />Number of Staff See 9212 Report 7 11 18
<br />Fully-Burdened Cost of Staff $535,397 per FTE [1]$3,549,116 $6,124,390 $9,522,020
<br />Office Space Required 200 sq. ft./employee [2]1,326 2,288 3,557
<br />Cost of Office Space $48.00 per sq. ft./year [3]$63,638 $109,814 $170,736
<br />Rent Registry Software Annual Subscription $90,000 $90,000 $90,000
<br />Hearing Officer Consultant $100,000 $100,000 $100,000
<br />Outreach + Education Consultant $135,000 $135,000 $135,000
<br />Legal Services for low-income
<br />tenants Consultant $1,059,840 $1,059,840 $1,059,840
<br />Total Annual Administration Cost $4,997,594 $7,619,044 $11,077,596
<br />Ongoing Program Cost Per Unit 16,168 Units $309 $471 $685
<br />[1] Estimate provided by City of Redwood City staff
<br />[2] Office employment estimate assumes 200 square feet per employee, based on CBRE office planning benchmarks
<br />[3] Costar Office lease rates based on an average of current offices leased by the City
<br />These estimates should be treated as planning-level estimates. Actual costs may
<br />vary depending on program utilization, staffing requirements, enforcement
<br />activity, and legal services demand 31.
<br />Start-Up Costs and Initial Funding Gap
<br />The initial 9212 report identified one-time implementation costs but did not
<br />address how those costs would be funded before the annual fee revenue is
<br />collected 32. City staff indicated that start-up costs would likely need to be fronted
<br />through an interfund loan and repaid through future landlord fees.
<br />Start-up costs include both the one-time implementation costs identified in the
<br />initial 9212 report and additional HR costs associated with establishing new
<br />classifications/positions, recruiting, hiring, and onboarding program staff. As
<br />noted in the initial 9212 report, Redwood City does not currently have excess
<br />staff capacity to absorb these additional responsibilities on top of current
<br />workloads. The City will likely need to hire between 7 to 18 new staff to
<br />implement and administer the proposed Ordinance. This would include the need
<br />Level of Enforcement
<br />Cost Assumption
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