INFORMATION #1 03-22-2004 - Laserfiche WebLink

Home Browse Search

March 8, 2004 Senator Betsy Wergin Senate District ~16 125 State Office Building 100 Constitution Avenue St. Paul, Minnesota 55155 Dear Senator Wergin: I'm sorry that we have missed each other with our phone calls over the last week or so. This being the case, I thought I would put in writing the main purpose for my initial call to you, which was to answer questions that you may have regarding Elk River's building permit fees and revenues. As I understand the situation, at a recent Legislative committee meeting Elk River was identified as a community that has high building permit fees xvhich generate excess revenues. First, I need to state that the Elk River building permit fees are based on the 1997 Uniform Building Code (Table I-A). The city has been using this fee schedule since the 1997 Uniform Building Code was adopted by the City Council in 2000. According to our Building/Environmental Administrator, almost all of the metropolitan cities and the non- metropolitan cities over 2,500 in population are using this same Table 1-A as a basis for their building permit fees. What did happen in Elk River in 2003 that caused our revenues to be higher than the budget has to do mainly with the large volume of building permits that we issued. From 2000-2002, the city averaged 261 building permits per year for single family homes and townhomes. Accordingly, when the 2003 budget was prepared, the estimate for building permit revenue was based on 275 permits being issued. What ultimately happened in 2003 was that we issued bnildmg permits for 550 dwelling units (285 single family and 265 townhome units). This ',vas twice the volume that the city expected. This high volume of activity also required additional city expenses to provide plan check and inspection services. Nonetheless, this volume of building permits, not the amount of our fees, is why the building permit revenues exceeded our budgeted amount in 2003. This unexpected revenue was part of the solution that allowed us to adequately deal with the 2003 LGA cuts.