Fees gain favor, but are they just a tax?

The City Council instituted them all while raising the property tax rate for the first time since 1984. The tax increase was modest, but it stirred the most resident reaction. The fees? Very little.

Are "fees" just a "tax" by another name? Residents don't seem to think so. Local governments across metro Atlanta are raising fees or tacking on new fees to bring in extra revenue or shore up budget shortfalls.

Residents appear reasonably receptive to them. Even in a sagging economy. Even as some ask: What’s the difference between a fee and a tax?

"Nobody wants to have their taxes increased. I certainly don't," said Duluth resident Maxine Garner, who headed the citizen-led committee. "Fees are generally paid by the user."

In Cobb County, residents will now pay $100 to hold a parade and $2,000 to put on a special event such as a festival. If you want to microchip your dog, the animal shelter will charge you $20. The service was free in 2010.

In Fulton County, officials are proposing a slew of fee increases that would affect residents and business owners in unincorporated south Fulton. The hikes in fees -- including adult entertainment licenses, false alarm charges, fire inspections and a new vacant property registration fee -- would go into effect Feb. 1.

As in Duluth, members of a Gwinnett County citizens panel recommended new and increased user fees this year to keep property taxes in check. The 42-member committee suggested parks, recreation and libraries lean more heavily on fees to support their budgets.

County officials say they have already increased park revenue by $115,000 as a result of adjusting fees in 2010. Most of that increase, $100,000, came from raising fees for nonresidents.

Gwinnett parks plan to generate an additional $206,000 in revenue this year. The biggest income stream will be for utilities, primarily lighting.

"We have a metering system set up, and we're actually going to be charging each youth association," said Phil Hoskins, the county's community service director. He expects revenue of about $150,000 by charging for lights.

By and large, Gwinnett residents have not resisted user fees, especially as an alternative to property taxes. But they let out a roar this fall when the county mandated residential garbage collection and attached the charges to property tax bills.

Dacula did not have that problem.

In November, city leaders raised the price for trash collection with no public outcry. In fact, residents such as Sarah Hays felt that increasing the $10-a-month charge was "way, way, way overdue."

Some cities may have no choice but to impose fees over taxes. When Milton and Johns Creek incorporated four years ago, they capped their property tax rate at 4.731 mills. Now, both are at or near that cap.

Milton adopted about a half-dozen new fees last month targeting tree lovers and telecom companies.

Residents now will have to shell out $5 for a city sign showing that an area protects trees. But most of Milton's new user fees lean less on taxpayers, more on businesses.

The largest new fees target the telecom industry. The city reasoned that telecom firms -- not taxpayers -- should bear the cost for the city's time and expense in approving the companies' applications.

Wireless providers seeking to install towers now will pay a $2,000 application fee, plus actual consulting costs up to $7,500.

"I like fees," Milton resident Tim Enloe said. "A tax goes across the board. Everyone has to pay regardless of whether they benefit or not. An impact fee addresses those impacting the area with the change."

Johns Creek has not instituted a new fee in more than a year, but the City Council is considering imposing a fee on residents and businesses that have multiple false alarms for emergency services.

Mayor Mike Bodker said fees may be the wave of the future, and they make sense for residents.

"People can draw a line pretty easily: I do this, I pay this. If I don't do this, I don't pay this," he said.

But Georgia State University professor Greg Streib, an authority on local government, said fees have drawbacks. For instance, homeowners might be receptive to the concept of a fee for false alarms until they're the ones paying out of pocket, he said.

"People don't know they even exist until you have to pay it," Streib said. "It sort of slips in like extra charges in your phone bill or credit card bill."

In some cases, they won't even show up as part of a government's budget breakdown, he said.

Snellville Councilman Tod Warner thinks fees are simply "good political cover."

"Politicians like to assess fees so they can say they never raised taxes," Warner said. "Both are taking money from the taxpayer's pocket. You tell me what the difference is."

Warner thinks the only argument in favor of fees over taxes is the fact that fees are assessed to everyone, including nonprofits and churches, which are tax-exempt.

Such is the case with stormwater fees, determined by impervious surfaces such as roofs and driveways. Over the past few years a number of cities, including Snellville and Sugar Hill, have imposed such fees. Roswell is adding one July 1, though it will be offset by a decrease in trash pickup fees.

Duluth is considering a stormwater fee as the city struggles to pay for steel pipe repairs out of its operating budget.

City Administrator Phil McLemore said homeowners are paying for stormwater runoff created by nonresidential properties such as churches. He said a city consultant conducted a presentation showing that those properties account for 72 percent of the stormwater but are paying 42 percent of the cost.

A stormwater fee would ensure that "everyone would pay their fair share," McLemore said. A final decision could come in June.

Staff writers Johnny Edwards and Megan Matteucci contributed to this article.

Fee-for-all
Counties and cities are raising fees and passing new ones. Some examples and projected revenue:

Cobb County

DeKalb County

Fulton County

Gwinnett County