City of Chicago doesn’t know how many fees it has on the books, Inspector General says

CHICAGO — To audit how the City administers fees, Chicago Inspector General Joe Ferguson went looking for a complete list of the various user fees. He says he couldn’t find one.

From garbage collection to towing and booting, Chicago fees generate millions. How many millions? Well, it’s not clear. According to Ferguson, an audit found the City cannot calculate total revenue generated by fees, and the City doesn’t know how many fees are on the books.

"In the course of our audit, the Office of Budget Management generated a list and the list that they attempted to generate we found others that they didn’t capture," Ferguson said. "We’ve identified about 321 altogether, but the guessing is that’s probably not all of them."

The Office of Budget and Management tells WGN it does in fact maintain a list of fees, but its list differs slightly from the Inspector General’s. Ferguson said according to the audit, their list list is not complete, and the City's fee policy does not follow national best practices.

The audit also found there’s limited chance for the public to weigh in on their cost, and the City does not regularly review and update fees, which the OBM also disputes.

"There is no grounded established program for assessing or setting fee levels, doing the requisite cost analysis in relation to policy and program objectives," Ferguson said. "It feeds into this overall impression of a government that’s really not sensitive to actually what the cost is of living in the city."

In a statement to WGN News, OBM says: “As we stated in our letter to the OIG, we plan to continue following our existing practice of performing a preliminary review to determine which fees should be modified or created before conducting an in-depth evaluation.” The OBM also said it is working to change the definition of what is considered a "user fee."

The IG conducted its own full-cost analysis of Chicago’s garbage collection and car booting programs. He said for garbage collection, the city’s estimate was approximately $40 million more than what was actually the case. For booting cars, he said they had underestimated the cost by a million.

The Inspector General is recommending the City develop a new policy to allow for more public feedback regarding fees, create a complete list of them, and establish a schedule for periodic review. To do all of this Ferguson recommends the City boost staff at the Office of Budget and Management.

"It would be money well spent to actually staff OBM at a level where they can engage in more thorough going analysis," Ferguson said. "There are numerous programs involving important regulatory enforcement issues where the particular departments or component of the department is under resourced partly because the fee structure doesn’t meet the cost of enforcement."

In other words, vital service providers may not have the money they need to do their jobs.

OBM told the Inspector General it intends to develop a user fee policy, create a complete list of all City fees and schedule periodic reviews. But it disagrees with the recommendation to support fee proposals with full-cost analyses.