Traverse City commissioners have approved an overhaul of the city’s fee structure for everything from event permits to parking rates to planning and zoning permits – and say they’d like to have more discussions about fees in the near future, notably parking rates and fees charged for big events like the National Cherry Festival and Traverse City Film Festival.

Commissioners approved an updated fee schedule at last week’s meeting, with most new rates going into effect immediately. City Clerk Benjamin Marentette explained that every other year, his office conducts an in-depth analysis of city fees, a process that will take place annually going forward. The city can “only recover costs associated with providing a service, such as a license or permit,” according to Marentette, meaning the city cannot randomly charge fees purely as a means of generating revenue.

Instead, “the primary bases for our fees are city staff costs,” Marentette says. “We calculate staff costs by determining the average amount of time it takes each involved staff member to perform their function related to the service.” The city tries to avoid having special services – like pulling licenses or using city property – subsidized by all taxpayers, instead aiming to recover those costs directly from users through fees.

Several categories saw fee increases this year, including liquor licenses, special events, and parking. A new $900 fee is now in place for those obtaining redevelopment liquor licenses – special licenses only available downtown and at The Village at Grand Traverse Commons – because of staff time required to calculate criteria related to those licenses, according to Marentette. New liquor license applications will go up from $540 to $710, while off-premise licenses – those used for grocery or liquor stores – will go from $170 to $710 to match the on-premise licenses for bars and restaurants. Marentette says the same amount of police investigation is required for on or off-premises licenses. Meanwhile, a discussion among city commissioners about charging all liquor license holders an annual renewal fee has been put on hold; Marentette says he’ll present alternate suggestions in June to address the community debate about the proliferation of liquor licenses.

Event planners will also face higher fees. City commissioners approved raising the street use application fee for for-profit events from $350 to $410, while the event fee for high-impact events – those on the scale of the National Cherry Festival, Traverse City Film Festival, and Ironman race – will raise from $300 to $500. However, staff noted both the Cherry Festival and Film Festival have special agreements with the city and are excluded by city policy from having to pay normal permit fees. Therefore, only Ironman or other new high-impact events going forward would pay the increased fee. Both the Cherry Festival and Film Festival pay incremental costs to the city – such as police overtime, which other event organizers must also pay – but do not have to pay to use city parks or parking lots or for application fees, as is required of other users. Marentette says the Cherry Festival, which pays approximately $35,000 to the city, would have to pay $20,000 more if the event were required to pay normal permit fees. The city clerk didn’t have the same calculations available for the Film Festival, but said that event’s fees would also be higher than the nearly $13,000 it paid in 2018 if it was held to the normal fee schedule.

Marentette points out exemptions were given by past city commissioners to the Cherry Festival and Film Festival because they “felt those two events were part of the fabric of the community” and had made historic contributions to Traverse City as nonprofit organizations that merited special treatment. But some city commissioners expressed interest in revisiting the special exemptions granted to the two events. “They don’t pay for the hundreds of hours staff (put in),” said Commissioner Brian McGillivary. “I’d just like to see if it’s something that commissioners are interested in opening up and charging them at least the base fee, like we charge other events.” Commissioner Amy Shamroe agreed the fees should be “added to our list of discussions” in the near future. Marentette says he is planning on a September 9 study session to review the issue with commissioners in greater depth.

Commissioners also approved several adjustments to city parking rates, even as they look forward to a Downtown Development Authority (DDA) report in the next 6-12 months on potentially adjusting fees and/or times for all categories of parking citywide. Changes approved immediately include charging daily or monthly fees for contactors or homeowners parked for extensive periods during construction projects on time-restricted streets, and raising fees for event planners taking over city parking lots. Under the existing policy, planners of high-impact events pay $2.37 per metered space and $2.40 per permitted space to use a city parking lot. Low-impact events have not been charged for parking lot usage. The new policy will charge all events, regardless of size, a rate of $7.50 per space for for-profits and $3.25 for nonprofits. The rate will increase gradually over the next several years until hitting the $7.50/$3.25 rate by 2023. While the Cherry Festival and Film Festival are excluded from the rate, that could change if commissioners adjust the exemption policy.

Meanwhile, residents and visitors looking for long-term parking downtown during those events will now have more options. With parking garages often reaching capacity during festivals, commissioners approved allowing drivers to park in downtown’s two-hour and four-hour spots – such as next to Mode’s, the Farmers Market, and the fish weir in the Warehouse District – for up to 10 hours during special events. Individuals only parking for a maximum of two or four hours in those respective spaces would still pay the normal $1 per hour rate – but beyond that window, the hourly rate would slightly increase, resulting in a total $15 to park for 10 hours. Special signage will be put up to let drivers know when they can park longer in the lots, with the electronic pay stations automatically adjusted to accept up to 10 hours' worth of payment.

Longer term, every parking rate and time restriction in the city is expected to come under scrutiny in the coming year. Parking Director Nicole VanNess says the DDA will do a “full-on rate study” of every parking fee in town, including meter rates, permit rates, and garage rates. A recent Transportation Demand Management study conducted by consultants for the DDA indicated the city’s parking rates are “relatively low,” says VanNess. Aspects the DDA will look at include not only the fees themselves, but when and where they’re charged. Commissioner Tim Werner asked the DDA to examine whether the city should charge parking fees later than 6pm or on Sundays, as an example, with VanNess confirming those are some of the angles the organization will study in the coming months.