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HomeMy WebLinkAbout6A Commercial Permit Review Process Report 4646 Dakota Street SE Prior Lake, MN 55372 CITY COUNCIL AGENDA REPORT MEETING DATE: JUNE 18, 2018 AGENDA #: 6A PREPARED BY: PRESENTED BY: CASEY MCCABE, COMMUNITY DEVELOPMENT DIRECTOR CASEY MCCABE AGENDA ITEM: COMMERCIAL PERMIT REVIEW PROCESS UPDATE DISCUSSION: Introduction The City Council requested staff prepare a report related to the commercial build- ing permit review process and timelines. The report will provide baseline infor- mation to the council, who can then discuss what additional steps may be neces- sary, if any, to ensure commercial building permits are processed quickly and ef- ficiently. History Over the past two years, Prior Lake has experienced a significant increase in both residential and commercial building activity. Total building permit valuation in 2017 was over $82 million with new commercial and industrial building permit val- uation totaling more than $13.8 million; both ten-year highs. The new commercial and industrial permit valuations were a 145% increase over 2016 and totaled more than the previous seven years of new commercial building permit value combined. The Community Development Department has a goal to have residential building permits for new construction reviewed in two weeks and commercial plans re- viewed in four weeks on average. The longer timeframe for commercial plans is because of their added complexity and project size. These targets can regularly be achieved if the plans are complete and of good quality. Commercial plan review includes an initial plan review by building inspection, plan- ning and engineering staff and if needed, a list of comments, questions or plan corrections are sent to the architect/engineer. The architect and/or engineer will make modifications to the plan and if needed, send a revised set back to the city. City staff will then do a final review and if there are no additional revisions needed, the permit is issued. If all corrections have not been made, or if there are additional issues identified, then the back and forth process will repeat at a quicker pace until the permit is ready to be issued. The abundance of single-family, multi-family and commercial and industrial per- mits submitted in the summer of 2017 resulted in a delay in issuing some of the commercial building permits within the targeted four-week timeframe. Current Circumstance This commercial plan review delay is largely because prior to 2018, building permit applications were reviewed on a first-in, first-out (FIFO) approach where all plans (single-family, multi-family or commercial/industrial) were reviewed in the order 2 they were received. In addition, almost all plan review was completed by one inspector, while nearly all field inspections were completed by the other two in- spectors. This led to some projects being delayed when a substantial number of permits were submitted for review at the same time. The FIFO approach to plan review is no longer in place. The City of Prior Lake is fortunate to have three very capable building inspectors. The current Building Official’s approach is to assign plan review to himself and the other two building inspectors. The inspector assigned to the plan review then fol- lows that project from beginning to end, receiving oversight from the Building Of- ficial. This allows the inspector who completed the plan review to also be the in- spector conducting the inspections in the field. This approach with three inspec- tors reviewing applications has resulted in plans getting reviewed sooner and building permits getting out the door quicker. The fact that the same inspector has reviewed the building plans allows the staff to focus on the most critical elements of the project on the site. In short, the inspection process can be more focused and completed quicker on site. This style of building permit review is much more business friendly by allowing the generally more complicated plan submittals (commercial/industrial and multi-fam- ily) to begin the review process sooner than the FIFO approach while not sacrific- ing residential plan review timeframes. With two more inspectors reviewing plans, the City of Prior Lake can prioritize commercial plan review with one of our inspec- tors while still meeting our standards for residential plan review. Conclusion Community Development staff are pleased with the current plan review process and changes that have been implemented in 2018. Staff is hopeful the current process will result in a consistently faster timeline from plan submittal until permit issuance for both residential and commercial building permits. Community Development staff are anticipating additional plan review efficiencies with the roll-out of electronic building permit application submittal in the summer of 2018 and in 2019 with the addition of a new plan review software. With these upgrades, and the new ability for credit card payments, it will be possible for resi- dents and contractors to submit an electronic application, have the plans reviewed and returned electronically and provide electronic payment. Applicants will be able to submit applications from anywhere and no longer be required to visit city hall to apply for building permits. Prior Lake has taken significant steps to become more business friendly in recent years including the adoption of ‘business friendly’ zoning ordinance amendments to reduce regulations and provide more flexibility for commercial properties and through the establishment of loan and incentive programs to defer certain devel- opment fees, and assist with demolition, relocation or soil correction costs. The recent commercial activity the community is experiencing is likely a result of these efforts. More recently, the City Council has taken additional business friendly steps through the approval of an amendment to the EDA Enabling Resolution and pro- vided funding to the EDA for specific economic development initiatives. The City Council and EDA are sending a clear message that the City of Prior Lake is ‘open 3 for business’ and is prioritizing economic development in the form of business re- tention, expansion and attraction. To enhance this message, it is important that city staff does everything in its power to provide a smooth building permit applica- tion process while ensuring sound planning and building code standards are main- tained. ISSUES: In addition to reviewing building permit applications and plans, the city’s three building inspectors completed approximately 5,000 inspections in 2017. Most of these inspections are completed in the warm-weather months, which is the same time most of the plans are submitted for review. Community Development staff have increased work hours during the busy months to account for an increased workload; however, an increased number of applications will result in a longer plan review timeframe. With the continued development of the community, it may be necessary in future years to bring in part-time, seasonal or an additional full-time building inspector to meet the city’s plan review and inspection timeline standards. FINANCIAL IMPACT: When builders and developers get their plans and permits faster it means that city staff is more efficient. One look at building permit issuance and added valuation shows that revenues are considerably higher than in 2017. The revenues are used in turn to provide the services expected by our builders, developers, business per- sons and residents. Proposed 2019 budget is expected to include expenditures related to plan review software and hardware. ALTERNATIVES: 1. Motion and second to accept staff’s report and therefore the changes outlined to be “open for business” in 2018 and beyond. 2. Provide direction to staff and continue discussion at a future meeting. RECOMMENDED MOTION: 1. Alternative #1.