User fees are a type of charge levied only against those who take advantage of a product or service. In most cases, these fees are distinguished from other fees and government charges, which are assessed to the general population as taxes. As one of its main sources of revenue, a government typically closely watches and adjusts user fees in an attempt to produce the maximum amount of income from such revenue streams.
One of the most apparent user fees in government is that of toll roads. While these roads may have originally been built, in part or full, with the use of tax money, often the maintenance and expansion of the system is paid for using tolls. These user fees are optional, because motorists often can avoid the toll roads, though it may make their trips longer. In essence, governments believe that enough motorists will use these roads, trading payment for convenience and time.
Though some politicians may attempt to stretch the language to fit their definition, a distinct difference exists between fees and taxation. A user fee is not compulsory, meaning there is no such thing as a mandated fee. Any fee that is mandated is, in essence, a tax because the user cannot choose to avoid the fee legally.
User fees are most often used specifically to preserve or enhance the product or service being paid for. In the case of camping, for example, the user fee is used as a way to provide a natural resources or conservation agency with a way of maintaining the land for natural recreational use. The same is true of fees for public swimming pools, which generally go toward the maintenance of the pool and, possibly, its eventual replacement.
In the case where the user fees do not adequately provide for the funding of the service or product, the government has several options. It can use tax revenue to supplement fee revenue for such services, which often comes from a general fund. It may also decide to raise those fees. Another option the government has is to simply suspend the service. The option chosen is often based on political goals and fallout.
On the other hand, user fees may also more than adequately pay for the service, leading to a surplus in the fund set aside for that fee. Governments may also have several options in such cases. Some may choose to save the money in a reserve fund in case future years bring in lesser amounts of revenue. Others may simply move the money into a general fund, or some other type of usable fund.
