Council Endorses Fee Overhaul After First Study in 16 Years

Walnut Creek's City Council took its first step toward closing a $12 million annual gap between what city services cost and what fees actually cover, directing staff to build a tiered cost recovery framework that could reshape charges for hundreds of services — from building permits to swim classes — while debating who should get a break and who should pay more.

• $12M general fund subsidy exposed: First comprehensive fee study since 2010 finds Walnut Creek recovers only 65% of $33M in fee-based service costs

• Council backs "resident discount" model over non-resident surcharges, but wrestles with 20,000+ unincorporated residents who use city services

• Affordable housing fees set at zero — and Council signals that has to change

• City's 10.7% vacancy rate clears state threshold with room to spare; 5% salary adjustments take effect July 1

• Gun Violence Awareness Day proclaimed as Moms Demand Action representative warns federal funding cuts are gutting local prevention programs

• Outdoor dining program wins second consecutive CALED award for parklet grant initiative

The $12 Million Question: Who Pays for City Services?

The basics: Walnut Creek hasn't comprehensively reviewed its user fees since 2010. The City hired Matrix Consulting Group to examine nearly 500 fee line items across every department, calculating what it actually costs to deliver each service using fully burdened hourly rates that account for salaries, benefits, overhead, and productive hour reductions.

Why it matters: The study found the city spends approximately $33 million delivering fee-based services but collects only about $21 million — meaning general fund tax revenues subsidize $12 million worth of services that primarily benefit individual users rather than the community at large. Every dollar the general fund covers for a building permit or recreation program is a dollar unavailable for roads, public safety, or parks.

"Current user fees recover about $21 million of these costs, resulting in an overall cost recovery rate of approximately 65%," said Administrative Services Director Kirsten LaCasse.

Consultant Khushboo Ingla of Matrix Consulting Group explained the firm's approach: "We utilize a bottom-up approach, which is the most defensible way of calculating fees. We look at each individual fee item and take a look at what does it truly take for staff effort to provide that service."

Where things stand: Council provided direction on six policy pillars that will shape the final fee schedule:

Three-tier framework. Council unanimously endorsed categorizing services into high community benefit (0–20% cost recovery), shared benefit (partial recovery), and private or market-based services (full or market recovery). Members requested clearer definitions for each tier before final adoption.

Resident discount. Rather than imposing surcharges on non-residents, Council preferred framing the policy as a discount for Walnut Creek residents. Councilmember Cindy Silva offered a consumer analogy: "Maybe what we should do is think about how residents pay a discount fee as opposed to charging more to non-residents." She flagged a complication: more than 20,000 people with Walnut Creek mailing addresses live in unincorporated county territory. Mayor Kevin Wilk said he would support non-resident rates "outside of people that have Walnut Creek as an address," signaling a preference for treating unincorporated residents favorably.

Phased increases. Council supported caps on year-over-year fee increases to avoid sticker shock, with gradual phase-ins for services where current fees are significantly below cost.

Annual adjustments. Members backed tying fees to an objective benchmark for annual updates. Silva suggested branding the mechanism as "cost-based fee updates" rather than referencing CPI directly, to avoid public confusion.

Market-based pricing. Council endorsed continuing market-rate pricing for voluntary services like facility rentals. Silva flagged that open space picnic area rentals should remain more accessible than arts and recreation facility rentals.

The other side: The sharpest exchange came over affordable housing fees. The study revealed Walnut Creek currently charges nothing for administering and monitoring affordable housing units — a zero-recovery line item that surprised several councilmembers.

"I'm not comfortable with the fact that we're not recovering any of our costs for this. Maybe it's not 100% cost recovery, but I don't think it should be zero," said Mayor Pro Tem Matt Francois.

Silva drew a distinction between different types of affordable projects: "There's a big difference in my mind of providing the service to RCD, which is 100% affordable nonprofit housing provider versus a market-rate project like 1950 NOMA that has 11 units out of 135." Council directed staff to evaluate housing-related fees separately, recognizing that fee levels could affect the economics of affordable development.

Councilmember Craig DeVinney probed whether the current 65% recovery rate was intentional or the result of 16 years of drift: "When these fees were put in place in 2010, was that the intention, two-thirds, or have we drifted from that?"

Key findings from the study: building fees are already right-sized, planning and engineering deposit-based services need updated hourly rates, and arts and recreation fees were evaluated to include staff costs plus custodial, utilities, and use-of-space components.

Decisions: Council voted 5-0 to receive and file the study (For: Francois, DeVinney, Darling, Silva, Wilk; Against: none).

What's next: Detailed fee recommendations go to the Finance Committee on June 23, return to full Council on July 21, with final adoption anticipated Aug. 18.

City Workforce Holds Steady at 10.7% Vacancy Rate

Why it matters: California Government Code Section 3502.3 requires cities to hold an annual public hearing on job vacancies. If any bargaining unit exceeds a 20% vacancy rate, the city must take corrective action. Walnut Creek's numbers show no unit near that threshold.

Human Resources Director Trish Raver reported the city has 387 authorized full-time equivalent positions with 41.25 vacant — a 10.7% vacancy rate. The city processed 3,939 applications for 24 job postings in calendar year 2025.

Raver highlighted recent recruitment innovations, including streamlined police dispatcher hiring with live Zoom "realism sessions" that give candidates a feel for the job before applying, and reduced typing speed requirements for administrative positions. On the retention side, the city recently completed successor labor agreements for Police Officers and Police Management associations, and 5% salary adjustments for seven bargaining units take effect July 1.

No bargaining unit requested to present at the hearing. No public comment was received.

Decisions: Report received and filed, 5-0 (For: Darling, Silva, DeVinney, Francois, Wilk; Against: none).

Gun Violence Awareness Day: Federal Funding Cuts Alarm Local Advocates

Mayor Wilk read the city's proclamation declaring June 6, 2026, as National Gun Violence Awareness Day in Walnut Creek, citing that "each year in the United States nearly 46,000 individuals are killed and nearly 97,000 individuals are wounded by gunfire." The proclamation honors Hadiya Pendleton, the 15-year-old Chicago student whose death sparked the national Wear Orange campaign.

Kathy Maloney, president of the End Gun Violence Club of Rossmore and a member of Moms Demand Action, accepted the proclamation and warned that community violence prevention organizations in Richmond, Oakland, and Contra Costa County have seen their federal funding decimated. She emphasized the importance of these programs in stopping gun violence at the local level.

Outdoor Dining Parklets Earn Second Consecutive State Award

Duane Dahlman, a board member of the California Association for Local Economic Development and economic development manager for the City of Alameda, presented Walnut Creek with the CALED Award of Merit in the programs and promotions category for the city's outdoor dining PODS (Permitted Outdoor Dining Structures) grant program.

Dahlman highlighted the delivery of eight parklets over 11 months and praised the Council's vision in establishing a $100,000 grant fund, as well as exceptional cross-department collaboration between economic development, planning, building, public works, and finance.

Mayor Wilk called outdoor dining the pandemic's lasting gift to downtown: "The silver lining in Walnut Creek was the outdoor dining. And it was like Europe walking down on the streets."

Developer Pitches Chevron Station Overhaul With EV Charging and Mobility Hub

During public communications, Ross Hill of 1850 Properties described a preliminary application to redevelop the 1962 Chevron gas station at 1700 Mt. Diablo Blvd. The plan would cut fueling positions in half and add EV charging stations, bike charging, and an improved bus shelter as part of a partnership with the Contra Costa Transportation Authority to create a mobility hub. The site remains owned by Chevron.

The proposal signals the ongoing transition of auto-oriented commercial sites toward multimodal transportation infrastructure along one of Walnut Creek's busiest corridors.

Minor Items

• Consent calendar approved 5-0 with no items pulled: Includes approval of May 19 minutes, warrant registers, resolutions for November 2026 election consolidation, Conflict of Interest Code review, FY2027 operating budget amendments and Gann appropriations limit, Cal OES Form 130 authorization for disaster relief grants, and the March 2026 investment and pension trust report.

• Tourism BID assessment (Item 6A) pulled from the agenda; the two-step levy process for FY2027 hotel assessments will resume at a future meeting.

• Closed session on anticipated litigation produced no reportable action.

• MCE credit rating reaffirmed at S&P A, with $554 million in liquidity (244 days of operating expenses), 58 long-term renewable energy contracts, and no outstanding debt. Councilmember Darling reported a behavioral energy conservation pilot saved targeted residents and businesses $380,000 by shifting electricity use away from the 4–9 p.m. peak.

• Recycle Smart adopted a 16-month transitional budget ahead of new contracts taking effect in March. Mayor Pro Tem Francois noted Walnut Creek's reserve balance exceeds $6 million, which could cushion anticipated rate increases.

• Councilmember DeVinney reported on Chief McAllister's appointment as Contra Costa Fire Chief.

• Councilmember Silva reported ABAG's upcoming general assembly includes a 4% dues increase, and highlighted the Aquanauts artistic swimming team fundraiser featuring the U.S. 2028 Olympic team.

• Mayor Wilk reported on the Memorial Day ceremony, Lindsay Wildlife Experience groundbreaking, Pride flag raising with nearly 100 attendees, and new restaurant openings downtown including Dapio Zero, Marufuku, and Mensho Ramen.

• City Manager Dan Buckshi announced Buena Vista Elementary's Odyssey of the Mind team placed second nationally out of 51 teams.

• Pete Sutherland, a retired teacher who taught at both Northgate and Los Lomas high schools and has lived in Walnut Creek since 1988, was sworn in to the Measure O Citizens' Oversight Committee.

• Northgate High School students Sakura Kuroda and Alina Ling promoted the IES Abroad student exchange program welcoming Japanese students from Kita City in August.

• Central Contra Costa Sanitary District Board President Florence Weddington invited the public to the district's 80th anniversary celebration on June 13.