by Connie Tabbert
Editor
COBDEN — Whitewater Region Township council unanimously passed a bylaw increasing building permit fees at its council meeting last night, following a 40 minute public meeting.
Chief building official Doug Schultz and Deputy-Clerk Hope Dillabough presented a brief titled Building Permit Fee Review 2013 at the start of the public meeting.
Leading off the discussion, Mr. Schultz noted that in 2006 a consulting firm in Ottawa reviewed the fee schedule at a cost of about $5,000. This time, Ms. Dillabough did the review, which took quite a long time, thereby saving the township more consulting fees, he noted.
“Hope did a very good job on it,” he said.
Ms. Dillabough said at the conclusion of the presentation, a recommendation will be made to council, not a decision.
She walked council through the brief, noting that in 2009, 125 building permits were issued and in 2012 that number increased to 209.
“The numbers fluctuate year to year, and there was an increase every year, except in 2011,” she said.
She then reviewed the time allocation staff would work on each building permit. On a residential permit the time worked out was about 19.25 hours for each new building permit, 13.25 hours for each addition building permit; 4.25 hours for a demolition permit and 11.25 on miscellaneous building permits.
For agricultural permits, it worked out to about the same hours, minus the miscellaneous, she noted. And, for commercial/industrial/institutional building permits, it was 38.25 hours for a new building permit, 21.25 hours for an addition building permit and 4.25 hours for a demolition permit.
“The duties are spread out between staff,” Ms. Dillabough noted.
When she broke down the costs for staff and salary, the total permits cost $123,941.05. That figure would be added to the building department functions, which totalled $33,372.07. Adding those two figures together, the total cost for permits in 2012 was about $155,313.12.
Then, Ms. Dillabough calculated the indirect costs, which are overhead, such as auditors, website, telephones, etc., and the cost added up to $15,085.38. The municipal departments time allocations were then added, and that totalled $7,757.15.
When the direct and indirect costs are totalled, it equalled $178,155.65 for building permits in 2012.
Concluding her report, Ms. Dillabough wrote: An extensive review of the building department was undertaken and the following was considered: The role of the building department and the staff involved; function and tasks completed; calculation of percentage of staff’s time and determining direct and indirect costs involved. It was concluded that the direct and indirect costs associated with the delivery services related to the administration and maintenance of the building department total $178,155.65.
In 2012, the actual revenue from building permits totalled $55,554.
Therefore, in order for the Township of Whitewater Region to operate its building department on a true cost-recovery basis, it has been determined that the building permit fees could increase by 320 per cent. This would allow the revenues from building permits to cover the direct and indirect costs of the building permit process and the department’s functions.
“We are definitely not recommending a 320 per cent increase,” Ms. Dillabough said.
When comparing this township’s building permit fees with other municipalities, “we are on the low to average end,” she said.
A 15 per cent increase is being recommended, Ms. Dillabough said.
A 15 per cent increase on the current rate of 35 cents a square foot would be 40 cents a square foot for a residential dwelling. Based on a 1,500 sq. ft. dwelling, the cost would increase from $525 to $600. On a non-living space permit, such as an accessory, the cost is currently 30 cents and would increase to 35 cents a square foot. Based on a 400 square foot building, it would increase from $120 to $140. For new commercial/industrial/institutional, the cost is currently 40 cents a square foot. Based on a 2,000 square foot building, a 15 per cent increase would see it go from $800 to $920. And finally, it costs 10 cents a square foot for an agricultural building and with a 15 per cent increase, a 2,000 square foot building would increase from $200 to $240.
Mr. Schultz said building departments are not supposed to make money, they are to work at or below costs. Each year, the department provides an annual report to show what it brings in and the costs, he said.
This information was brought to council via the public meeting, because they were asked to do a review, he said.
Reeve Don Rathwell said he would vote against the bylaw when it came to the council table following the public meeting.
“I’ve been promoting development fees to replace these increased costs,” he said.
He said he didn’t want to pass the bylaw because he wanted to talk to other people and peruse it further prior to making a final decision.
Mayor Jim Labow noted the discussion on building permit fees have been discussed several times, as well as development fees.
Mr. Schultz said development fees are split between the various departments of the municipality and could be area-rated depending on what the make-up of a municipality is, such as rural versus urban.
The township is reviewing all fees and the building department is bringing its review forward, he said.
Councillor Daryl McLaughlin did calculations, and he said at 15 per cent, that’s only a two per cent increase per year for eight years.
“That’s not very much when it’s spread over eight years,” he said.
Cedar Haven resident Don Deere said he worked in an industry where a 320 per cent increase could not be passed onto customers.
“You have to look at cost reduction,” he said. “I want to know what council has done to look at cost reduction. I’d like to know why these direct costs of the building department function, except legal costs, are not included in the salaries and benefits.”
Ms. Dillabough said it is part of the salaries and benefits, but this is a snapshot of the building department. The total department includes planning, bylaw and animal control, she noted.
As for reducing costs, Mr. Deere said in industry, the first thing to do is find ways of reducing costs. In this area, it could be sharing a building inspector with another municipality, he suggested.
“There’s always something that can be reduced,” he said. “There’s all kinds of things you can look at. It’s a lot easier just to pass your costs on to whoever’s getting a building permit, but that’s not always the answer. The first question you should ask yourselves, “What can I do to reduce the costs to the taxpayers of Whitewater Region.” Nobody seems to be doing that.”
Chief administrative officer Christine FitzSimons said that is done each year in every department during the budget review.
Councillor Allen Dick said there is a 67.2 per cent increase in building permits over four years.
“That’s considerable,” he said. “Our building and renovation building permits have definitely increased a lot in the last four years. That should be looked at as well.”
Mr. Schultz added there are also about 50 to 60 septic system permits a year, which are not included in the report.
“We’re probably averaging between 250 and 260 permits a year that we have to process and do the inspections for,” he said. “You have no idea how many phone calls and emails I get. In a day, I can easily get 50 emails” of people asking questions, he added.
Mayor Labow said many municipalities cannot share a building inspector because there is just so much work and things involved in the job to split your time.
“For a municipality to have any kind of development, the building inspector is not going to have time to do his job in another municipality as well,” he added.
Mr. Schultz said if the building inspector was just doing that one job, he could possibly cover two municipalities. However, that’s not the case.
“We are dealing with so much more,” he said. “In our department we are dealing with zoning, planning, dogs, bylaws, project management stuff and building stuff and subdivisions. If anything, we need more help.”
Resident Charlene Jackson said some of the building department costs can be spread across the municipality, because if the permits are cheaper, that could encourage more construction which would equal more assessment.
Mr. Schultz said this is the first time since he has come onto staff that there has been a building permit fee review. In Laurentian Valley, where Ms. Jackson works, the fees are “next to nothing” because they have lots of development.
Last year, the township had $12 million in building permit fees. While that should increase assessment, that’s not the case because they could be under-assessing what their project is worth, he said.
“A lot of councils will say this is what it costs to run a building department and we’re going to offset the rest onto the taxpayers because if we can keep the fees cheaper, it just keeps everything going,” Mr. Schultz said.
Mr. Schultz explained the building permit process so people would know what they are paying for following a question from Donna Burns.
Councillor Joey Trimm said when the person is getting the building permit, most of the work has been completed.
“Everything else, such as studies, has to be done first,” he said. “The last thing you get is the building permit. You have to satisfy all other criteria first. If you want to build a house on a piece of property, and you want to sever it into a lot, there’s where you run into any particular studies the province may require. By the time you get to Doug, you have satisfied all the requirements. The last thing is the building permit.”
Mr. Schultz said when people bring in their information to get a building permit, “if it’s outside the building code, I tell them to get help.”
Doug Shields questioned how the Provincial Policy Statement affects building permits.
“I don’t look at it,” Mr. Schultz said. “The Provincial Policy Statement is for new severances, new land creation. I don’t look at the endangered species. When you start developing the property..when it hits the planner’s desk, that triggers the PPS.”
Reeve Rathwell said council wants to promote growth and development. In this municipality, there are three public schools and one separate school,
“If we don’t keep bringing people in here, and young families in here, we’ll lose those schools,” he said. “When you lose your schools, you start to lose all sorts of things, including businesses. We’re so fortunate to have the businesses we have in Beachburg and Cobden and surrounding areas. These schools, remember that they are out there every day looking to close schools. If we start to lose that then we’re losing a big part of our community.”
Reeve Rathwell said he’s not against the increase in building permit fees, he just wanted to delay passing the bylaw for a month to get more insight.
“We have to look to growth and development,” Reeve Rathwell said. “The work that you are doing Doug, you have to continue on, everybody, regardless of who’s on the next council. If you don’t do that we’re going backwards. If you stand still you’re going backwards, and we don’t want to do that.”
However, at the council meeting, Reeve Rathwell flip-flopped and voted in favour of the building department fee increase.
While he would like the bylaw held over, he thought development fees were going to be reviewed more thoroughly. He said development fees can’t be put on top of these fees, so that will have to be discussed at another time.
“I think that we would be better off, at this time, going with this,” he said. “I’ll change my approach on it and approve it.”
Reeve Rathwell said if someone is coming into the municipality to build, there are already firehalls, community rinks as well as fire and road equipment. These people walk in from another area and they have all the stuff the taxpayers in Whitewater Region have built up through the years. That’s why development fees are necessary, so they don’t just get the use of these things without having to pay something, he said.
“I’m not going to get support for that right now I guess,” Reeve Rathwell said. “I will go ahead with whatever council decides tonight.”
Mayor Labow said development fees are separate from this and there has been work done on development fees.
“There is quite an involved process in calculating those fees,” Mayor Labow said.
Reeve Rathwell agreed, but, he said, it’s the current taxpayers who are picking up the costs not being paid for by the permit user.
Councillor Daryl McLaughlin said, “We should keep on working towards our development fees. I’m in favour of passing this (bylaw), but we should keep working on it. We can amend this (bylaw) as we see fit.
“I want to see this go ahead and work towards our development fees,” he said. “As the reeve said, it needs to be done. I don’t want it put on the back burner.”
Coun. Trimm said this is a reasonable increase, even though it’s based on information that is a couple of years old.
“We should be, to some extent, subsidizing the building department,” he said. “It’s fair. The people who are using the service should be able to pay what the cost of living was for the last eight years.
“Fifteen per cent is not too much to ask, because we are still providing quite a subsidy for this service,” Coun. Trimm added. “I certainly would vote in favour of this charge.”
