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Item 7A & BAGENDA ITEM # 7A&B OCTOBER 12, 2009 STAFF REPORT City of Atlantic Beach Commission Meeting AGENDA ITEM: Clarification: Building Permit Fees DATE: September 18, 2009 l SUBMITTED BY: David E. Thompson, Asst. City Manager Michael Griffin, CBO, CFM, Building Official BACKGROUND: At the September 14, 2009 City Commission meeting, staff presented proposed changes relative to building inspection fees. The purpose of this report is to further clarify the recommendations before the City Commission takes action to adopt recommended changes. The August 24, 2009 staff report recommended an increase to the "minimum permit issuance fee" by $20.00. Specifically, the permit increase is for the "minimum permit issuance" only, and none of the other fees for building, electrical, plumbing, or mechanical will be increased (Staff did not recommend making changes to the fence permit issuance fee). Clarification There may be more than one (1) "minimum permit issuance fee" for each construction project. The following "minimum permit issuance fees" may apply to a single project: a. Building Permit Fee: $35.00 (Minimum) Permit Issuance Fee is based on formulas in the code, more expensive projects have higher building minimum permit issuance fees b. Electrical Permit Fee: $35.00 Permit Issuance Fee c. Plumbing Permit Fee: $35.00 Permit Issuance Fee d. Mechanical Permit Fee : $35.00 Permit Issuance Fee e. Fence Permit Fee: $35.00 Permit Issuance Fee If a project only requires a single permit, then the total increase in the cost to the applicant will be $20.00. If a project requires all five (5) of these permits, then the total increase in the cost to the applicant will add up to an $80.00 increase. This is the maximum possible increase in costs based on the recommendation to raise the minimum issuance permit fees. With this clarification, the recommendations contained in the September 14, 2009 staff report remain unchanged. AGENDA ITEM # 7A&B OCTOBER 12, 2009 BUDGET: The recommended increases will generate approximately $48,000 in revenue to provide sufficient funding to cover the costs of the operations of the Building Department. RECOMMENDATIONS: To raise all of the "minimum issuance fees" by $20.00, and to adopt the other changes in the attached copy of the Schedule of building permit fees. ATTACHMENTS: 1. August 24, 2009 Staff Report 2. Examples with Calculations of Costs 3. Proposed Ordinance Number 25-09-41 REVIEWED BY CITY MANAGER: AGE A ITEM NUMBER: AGENDA ITEM # 7A&B OCTOBER 12, 2009 STAFF REPORT City of Atlantic Beach Commission Meeting AGENDA ITEM: Building Department Fee Proposal(s) DATE: August 24, 2009 SUBMITTED BY: David E. Thompson, Assistant City Manager Michael Griffin, CBO, CFM, Building Official BACKGROUND: As discussed during the budget workshops, the Building Department is currently operating at a deficit, which is requiring the City to supplement the Department with general fund money. Based on the current projections for this fiscal year, the deficit is anticipated to be approximately $78,000. The Building Department is an enterprise fund that should generate enough revenue to cover its expenses. Ideally, the City should only supplement the Building Department with general fund money for work that is not specifically related to building permitting. Currently, there is a slight offset for administrative staff performing duties outside of the Building Department. There has been a significant decline in revenues from approximately $328,000 in 2007, to a projected total of $214,000 in 2009. This is largely a factor of the decline in construction due to the economy. During the same timeframe, expenses for running the Building Department have declined from a high of approximately $315,000 in 2005 to a projected $293,000 in 2009. Staff has reviewed the existing fees relative to processing and reviewing construction projects, and a number of recommendations have emerged as a result. Additionally, Building Department staff members have been assigned to perform duties outside of their department to account for the general fund transfers into the Building Department account. Proposed Fees for Building Department Services: The building permit fees have not been changed since 2002. At that time, the minimum permit issuance fee was raised to $35.00, along with the specific inspection fees such as fire, electrical, plumbing, mechanical, and signs. The actual formula for determining building permit fees, based on the cost of construction, has not changed since 1982. The anticipated 2010 budget deficit has been the result of an increase in minor construction projects such as renovations, re-roofing and similar work, and a decrease in new construction as a result of a sluggish economy. It appears that more homeowners are renovating existing homes instead of building new homes. These smaller projects have caused the number of inspections to rise from previous years, but revenues have been reduced as a result of the reduction in larger, more costly projects. The Building Department anticipates completing nearly 3335 inspections this year, which is the highest number since 2004. However, the AGENDA ITEM # 7A&B OCTOBER 12, 2009 revenues have declined. In reaction to this rise in inspection activity and to eliminate the deficit, staff has proposed changes and amendments to our current fee structure to cover the anticipated administrative and inspection costs. The recommendations below are allowed by Florida Statute 553.80, and they are similar to fees charged by other jurisdictions of similar size within State of Florida. 1. Increase the minimum permit issuance fees from thirty-five dollars ($35) to fifty-five dollars ($55). The minimum permit issuance fee is charged for each permit. This fee amendment will allow the current schedule of fees, based on construction costs, to increase a total of $20 regardless of the size of the project. Staff anticipates issuing 1790 permits next year. This change will generate an estimated additional $35,000 in revenue. 2. Add a new fee for re-inspection of work that failed the previous inspection, from thirty- five dollars ($35) to fifty-five dollars ($55) per re-inspection. Based upon the number of re- inspections this would generate an additional estimated $3600 in revenue. 3. Add a new fee of one hundred dollars ($100) for a change of tenant inspection within an existing business location. Currently the Building Department does this inspection at no charge for a new tenant. The fee would cover costs for required application review (building and zoning), property inspection (building, electrical, plumbing, mechanical, accessibility and parking). Our process also identifies changes of occupancy which may result in additional building safety requirements such as fire exits, fire-walls, grease interceptors and accessible parking. This fee would generate an estimated $7200 in revenue. 4. Add a permit renewal fee for expired permits. According to the Florida Building Code Section 106, all permits that have not received an approved inspection for a period of six months shall be considered abandoned and invalid, and renewal is required. The following schedule is recommended and consistent with other Florida jurisdictions. Completed Inspection No inspection conducted Slab inspection approved Slab poured All rough inspections approved Insulation inspection approved Final inspections pending Amount of Renewal fee 100% of original fee 80% 50% 30% 10% This amendment would generate an estimated $3,000 in additional revenue. If an applicant abandons a project after the issuance of a permit, then the applicant may request a refund. A fee of at least fifteen percent (15%) shall be retained by the City, AGENDA ITEM # 7A&B OCTOBER 12, 2009 including the permit issuance fee, for administrative processing. Additionally, after a permit has been issued, plan review fees will not be refunded. The residual inspection fees may be refunded following a site inspection to assure that there are no violations of the Florida Building Code. 5. Add a plan review re-submittal fee of fifty dollars ($50) for the second re-submittal, seventy-five dollars ($75) for the third re-submittal and one hundred ($100) for the fourth re- submittal. An estimate of the generated revenue is not known at this time. Applicants submit plans for review before they begin construction on their projects. These plans are reviewed by Building Department staff members, and then the plans are returned to the applicants as "approved" or "not approved:' If the plans are drawn by a competent architect, engineer, or builder, they rarely need more than two (2) reviews. However, when plans are repeatedly submitted, not approved, and resubmitted, then there should be fees for the multiple reviews. Staff recommends an escalating scale to encourage applicants to utilize competent professional services to avoid repeated plan reviews. Reassignment of Building Department Personnel The Building Inspector has been assigned to perform Code Enforcement duties for eight (8) hours per week. This is considered to be a temporary adjustment until the workload and revenues in the Building Department increase significantly. This assignment increases the code enforcement attention in strategic targeted areas, while it maintains invaluable staffing necessary for Building Inspections. BUDGET: The Building Department fees should result in an increase in revenues of approximately $46,000, which will significantly reduce the amount needed to eliminate the deficit projected in 2009-10. RECOMMENDATIONS: To review, provide guidance, and adopt the recommendations above into ordinances. ATTACHMENTS: List of other Florida cities and their building permit fees. REVIEWED BY CITY MANAGER: AGENDA ITEM NUMBER: AGENDA ITEM # 7A&B OCTOBER 12, 2009 Comparisons of Building Permit Fees with Similar Sized Florida Cities 2009 City of Atlantic Beach permit fee for $100,000 building= $690 with amended fee = $710 Minimum base permit fee $35 Proposed base fee $55 Broward County permit fee for $100,000 building = $1,832 Minimum base permit fee $56 City of Delray Beach permit fee for $100,000 building= $2,030 Minimum base permit fee $50 City of Mt. Dora permit fee for $100,000 dwelling = $1,012.50 Minimum base permit fee $75 City of Fernandina Beach permit fee for $100,000 building = $1,099.50 Minimum base permit fee $25 Indian River Shores permit fee for $100,000 building= $912.30 Minimum base permit fee $60 City of Jacksonville Beach permit fee for $100,000 building = $ 690 Minimum base permit fee $20 Note: fees not raised since february 1997 City of Miramar permit fee for $100,000 building= $2,100 Minimum base permit fee $75 City of Neptune Beach permit fee for $100,000 building= $ 765 Minimum base permit fee $25 Note: fees not raised since 2003 City of Palm Beach Gardens permit fee for $100,000 building = $1,210 Minimum base permit fee $50 City of St. Pete Beach permit fee for $100,000 building= $1,432 Minimum base permit fee $50 AGENDA ITEM # 7A8cB OCTOBER I2, 2009 ~~ t0 a a~ a, a,~ C :a m .-i ~ o0 00 I~ I~ l0 O O O ~ O U ~O L a w a ~ O Lf1 00 ~ C 01 ri 61') N !~' ri e-i L a ° ° ~ o o o o , , ° ° 3 0 ° ~ o ~ ~ ~ ~ ~ .-i cri ~ ~ ~ ~ yr ~ ° ° ° o o o a, LL ~ O Q M ~ e-i M ~ i/~ t/} t/} i/? 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