HomeMy WebLinkAbout10B - Report Regarding Building Permit Fees
MEETING DATE:
AGENDA #:
PREPARED BY:
AGENDA ITEM:
DISCUSSION:
4646 Dakota Street S.E.
Prior Lake, MN 55372-1714
CITY COUNCIL AGENDA REPORT
APRIL 6,2009
10B
JANE KANSIER, BUILDING AND TRANSPORTATION SERVICES
DIRECTOR
CONSIDER APPROVAL OF A REPORT ON BUILDING PERMIT FEES
Introduction
The purpose of this report is to review the fees charged by the City of Prior
Lake for a building permit, as requested by the City Council.
Historv
On February 2, 2009, the City Council directed staff to prepare a report on
showing the components included in a building permit fee. For the basis of
this analysis, the staff uses a permit for a new single family dwelling in a new
subdivision valued at $250,000 since it was a convenient comparison with
other communities. The staff reviewed the fees currently charged by the City
of Prior Lake. We also surveyed other communities to get an indication of
their fees for a similar project. A copy of the results of this survey is attached
to this report.
Current Circumstances
There are several fees included in a building permit fee. Some of these fees
are statutory, some are dictated by other governmental agencies, and some
are determined by the City through studies. To break down the fee structure,
we have divided the fees into two categories:
1. Buildina Permit Related Fees: These are the fees applied to the specific
building permit, and include plan review, inspections and general
administration. The City's current schedule for these fees was adopted in
2003 as is the case with most metro area communities.
2. Develooment-Related Fees: These fees are intended to cover the cost of
maintaining and building infrastructure necessary to accommodate new
development. One of these, the Metropolitan Council SAC charge, is
dictated by the Metropolitan Council. The City passes this fee back to the
Metropolitan Council. The City's development fees were all determined by
infrastructure studies completed in 2004. These studies were based on
the actual cost to install and maintain the City's utilities.
A permit for a $250,000 single family home has the following costs:
www.cityofpriorlake.com
Phone 952,447.9800 / Fax 952.447.4245
Building Permit Related
Permit Fee $1,953.50
Plan Check Fee $1,269.78
State Surcharge $125.00
Plumbing $150.00
Heating $150.00
SIW $52.00
Fireplace $50.00
Subtotal $3,750.28
TOTAL
Development Related
SAC $2,000.00
City SACIWAC $1,500.00
H20 Tower Fee $1,000.00
Bldr. Deposit $1,500.00
Subtotal $6,000.00
$9,750.28
The staff has prepared a PowerPoint
presentation for the meeting which will provide
greater detail on the permit fees.
As the pie chart to the right indicates, 38% of
the fees are Building Permit related and 62%
are Development related.
ISSUES:
1. When charging a fee, the City must establish a "rational nexus." This
means the cost of delivering the service and the fee charged are in line
with one another.
2. The Council has heretofore taken the position that when a benefactor of a
City service can be identified, all things being equal, that customer should
pay the costs rather than have the taxpayer subsidize growth.
3. With respect to building permit fees, the City has stayed with the 2003
AMM fee schedule. This fee schedule is actually based on the fee
schedule established by the Uniform Building Code in 1997. When an
increase was discussed in 2006, the City decided to stay with the 2003
schedule as it better reflects our actual City costs (as opposed to an
annual 3% increase in the fees).
4. Virtually all City development-related fees are initially established and
periodically confirmed by completing a study to identify actual City costs.
This is considerably different than the "survey" approach many cities have
historically used to establish fees. In fact, many other cities have
requested our fee studies to use as a model.
FINANCIAL
IMPACT:
Any adjustment to lower the fee schedule will impact the City's budget and our
ability to provide timely permit review and inspections. The City Council should
review the information presented at the meeting and provide staff with
additional direction.
ALTERNATIVES:
1. To be determined by the City Council.
RECOMMENDED
MOTION:
As per the City Council's discussion.
ReVie~l:f
Building Permit Fee Comparison
Prior Mounds New Inver West St. Cottage
Farmington Savage Lakeville Hastings Blaine Grove Champlin Otsego Plymouth
Lake View Hope Heights Paul Grove
Subtotal - $3,750 $3,724 $3,738 $3,396 $3,352 $3,352 $3,373 $4,035 $3,799 $4,223 $3,475 $4,138 $3,600 $3,554
Permit Fees
Subtotal -
Development $6,000 $5,875 $8,490 $7,675 $5,400 $6,264 $3,492 $2,000 $5,290 $4,700 $5,000 $5,188 $3,533 $3,425
-Related
Permit Fees
TOTAL $9,750 $9,599 $12,228 $11,071 $8,752 I $9,616 $6,865 $6,035 $9,089 $8,923 $8,475 $9,326 $7,133 $6,979