Travis County Commissioners Court
November 9, 2004
Item 41
Number 41, consider and take appropriate action on the following proposed
fees for the review and inspection of subdivisions within Travis County and
amendment to the f.y. '05 budget. B, the creation of three new positions in
transportation and natural resources department to perform review and inspection
of subdivisions within Travis County effective April 1, 2005. In a, last time
we discussed briefly the fees that were proposed and [indiscernible] has requested
a couple of weeks to look at those fees and see if they had questions or issues.
If there are representatives here from the home builders, please come forward.
We have heard staff's presentation at least twice and we remember both of
them. There were issues raised last time and I don't know if those issues
were solved or not. The purpose of today's agenda is find out that situation.
>> okay. My name is hank smith. I’m with the home builders
association. I appreciate the two weeks you gave us to look into this more.
We had been working with the county for several years on at love these issues
and kind of the focus on the last two weeks is prior to 1445, Travis County
was reviewing all plats for construction plans, for right-of-way dedication,
for drainage issues and doing construction phase services. After 1445 was
passed and local agreements were passed the county is still looking at the
same issues. When we went through the rule-making process that was required
by 1445 and 1204, we were very careful to make sure that non-substantive changes
were made to those rules. That was something the county and the city and the
stakeholders all sat down and we enumerated numerous times whatever changes
are made cannot be substantive, just administrative changes, procedural changes
and something that basically eliminates any duplicative effort and any conflicts
in the rules, because there were conflicts before. The city rules said one,
the county said the opposite and you were stuck in the middle going back and
forth. The rule-making process we focused the last two years was getting rid
of all of that. The overall idea of the bill was the review fees would come
down. If you take a set of rules where the city and county are both doing
the same thing, any city and county are both doing the same thing and overlapping
the review authority, you get rid of that authority and assign one task to
the city, one to county you, the assumption fees would go down if both were
based on true cost of service. That's kind of where we would end this whole
process. We always understood the city's fees were too high, they were coming
down. I think also the county fees were too low and would be coming up. But
the net effect we will hope for within Austin and Travis County would be that
the net fee would be going down or at least nothing going up as a result of
the changes that were made. What we've done the last couple of weeks is looked
at several things. In reviewing the fee structures that are out there, we
are seeing the review fees going up. And that they range in -- it's very difficult
to say exactly how much they are going up on a -- in general. You have to
look at specific projects so I kind of made up a project and said on this
particular 100-lot 20-acre plat, what would the review fees been before and
now. What I’m finding it's about a 50% increase in the county rules and about
a 30 to 40% decrease in the city rules. The county fee would go from about
9,000 to about $15,000 give or take. City would go from 4300 to 2700. I've
got a caveat the city of Austin fees they do not include construction plan
review or construction stph-pls in their fees. On this type of project, their
construction inspection fee would be somewhere in the neighborhood of $55,000
to $60,000 and the county did not have a fee with that. Generally the city
takes 25% of that $60,000 fee and applies it to their plan review. There's
nothing that officially describes that, but it's kind of understood that happens.
So you are taking a $15,000 amount that the city really says is not part of
our subdivision process, it's part of our construction plan, inspection fee
process, but it really goes toward the plan review process. That fee is not
changing at the city so that the staying the same. Part of their fee is coming
down 40%, but it's a small portion of their fees. The net result is the project
would go from what was previously a $13,000 fee program to a $17,000 fee program
for just the platting phase of that project. That's about a 30% increase.
We looked at several other projects and found that even outside of the e.t.j.
Where it's just a true Travis County project and there's no impact from house
bill 1445 and 1204, fees were going up 20%. So I think if you take that 20%
and you say baseline the county hasn't changed their fees in i've heard 10
years, there may be a 20% increase that's just simply due the fact they haven't
changed their fees. And then a smaller increase due to the fact that house
bill 1445 is putting more responsibilities on to the county. So it's very
difficult to come in and say what the overall net effect is. There's too many
variables out there to look at. We are concerned because the fees are going
up across the board on any project. And -- but at the same time we also understand
that. Several things came out in the last few weeks' review that I wanted
to kind of highlight. The city of Austin divides Travis County into two halves.
For lack of a better term the western half is their drinking water protection
zone, the eastern half the desired development zone. Travis County doesn't
really recognize the same thing in their regulations. Officially. The city
of Austin is always giving you fee incentives to develop in the desired development
zone. They encourage you to develop on the east side so they reduce their
fees across the board. The fee structure you are looking at for Travis County
is actually going to have higher fees in eastern Travis County than they are
in western Travis County. And so your approach is just the opposite. You have
increased fees on the east side of town, decreased fees to west side of town.
There's a reason for that. The city is saying in this process, county, we
want you to appoint a case manager when we're dealing in the desired development
zone and we'll handle the case manager in the drinking water protection zone.
So you have additional duties on the eastern side of town much it's a curious
point the fees are going up higher in east Austin than the western side. Not
-- in the drinking water protection zone versus the desired development zone.
The county and is city's position are flip-flopped in terms of how their fees
are structured. Another area of concern -- and what really got me started
last week was the short form plat. A short form plat is no right-of-way dedication
and you are only looking at usually a handful of lots. There's no limitation,
I don't think, in the rules, but it's generally two or three lots we're looking
at. You just talked about a short form plat for the landfill, I believe. The
review fee for that used to be $800. Aoeup sure Travis County suspect that
$800 a long time ago on that short form plat. That fee is going to over $4,000
for a typical three lot shorpl form plat. Certainly for a project like that
it's not going to be a big impact. But a lot of the short form subdivisions
are people who have gone out and managed to buy a mobile home and found a
piece of land somewhere and stuck out that piece of land only to find out
they are in an illegal subdivision by doing. That now they have to come through
a subdivision process. To suddenly hit thupb with a $3,000 or $4,000 fees,
it's not going to be economically feasible. What you may find is an increase
in subdivisions that are illegal subdivisions. Particularly not in the eastern
side where a lot of people are just putting mobile homes on a lot and there
may be an acre lot or three acre lot, but it's simply not a legal subdivided
lot. The only way to do this is go through this process. Used to be $600,
$700, now it's $3,000, $4,000. You may want to look at some type of a mechanism
to -- the city of Austin has a smart housing program where they will waive
fees when certain items are met. There may be a way the county can look at
waiving fees on certain subdivisions costs if it's appropriate. But I think
what you may find is just an increased number of illegal subdivisions on some
of the short form plats because that fee is going up over 400%. That is the
biggest increase in fees you see here. So that may be something you need to
look at closer.
>> joe, can you tell us -- I mean what is the -- is it just
the cost? Is that really what we have found ourselves in here? Because that's
pretty exorbitant.
>> most of this is just your cost of service analysis. You
are actually looking how much it costs to process a sub subdivision plat.
This is the first time we've ever looked at any detail at our true cogs. So
I’m not denying our fees are going up, but it's also based on what we have
studied in detail. Now, the issue of how this applies just to groups of people
when they come in is a different issue. What we've looked at is, you know,
straight up, you know, we're not trying to make policy in the way we're recommending
fees. This is truly cost recovery.
>> but did we look at whether or not the services that we
provide are absolutely necessary for us to do our job? For example, on the
short form plat, are we convinced we are not performing unnecessary services?
>> let me let the reviewer answer your question.
>> that question was designed for a short answer.
>> if there is anything that we could have a not done, I
mean we're not doing anything extra and I use, but as time has gone on, more
and more legislation has been passed that we have had to review for. It's
kind of been nickel and dimed added onto the review process throughout the
years. So we've had to incorporate that into the review. So it's become more
complicated over the years.
>> so if the court would ask -- tell us what you do on the
short form, that would be a list of services that we perform and by each service
would be I guess some indication of time and then some cost for it.
>> absolutely. When we worked with deloitte, we looked at
our standards. We looked at our check sheets. We went through and it was a
very eye opening exercise. We looked at how long it took -- how long it took
to do that. How many reviews it took to do that. And how much time per review.
Absolutely.
>> and certainly over ten years we have seen a substantial
change, and I think for the good, for the people that are doing this hard
work in terms of the salaries we pay our professional staff. And certainly
health insurance is killing everybody. And those costs, unfortunately, have
not gone up maybe 10 or 20%. I would have been thrilled if they went up 10
or 20% over 10 years. There was one year we saw about a 33% increase in health
insurance costs in one year. And again, with the paying of our professional
staff, which is commensurate with what is going on at the city of Austin,
I think the one thing I would take issue with is that perhaps there was a
desire and wish that the exact amount that we were perhaps under cost of service
would be the exact amount that the city of Austin perhaps was over. And I
think what we have found out is we don't know how or why they came down, what
they did over at the city because it isn't based on a cost of service we can
all analyze. We have to take their word that's what they think is appropriate
and that's their business.
>> I agree.
>> but what we have been able to do is say we were way below
where we ever thought we were, and so you are right, it is coming up more
than perhaps we all thought and anticipated, but I feel confident that it
is based on actual costs. And I feel like we were back in '98 when we were
talking about e.m.s. When the city of Austin said, you know, 300,000 doesn't
really cut it number for us providing e.m.s. Service for you out in the city.
When they actually put pen to paper, it was more like $1.2 million. It was
a huge sticker shock for us. But it basically said we were able to take advantage
of a large number of years there where we did not have to pay the true cost
of service and those days don't exist anymore.
>> let me give you a chance to finish.
>> I agree with you. We participated with deloitte and had
feedback what was going on. I think another side effect that the city of Austin
takes away or adds three staff members and ajust fees, you never notice it
in their budget. When t.n.r. Has six, seven people dedicated to program, they
need to add three more, that's an increase in fees just because it's a 50%
increase in staff and they need more people. There's no disputing that. I
think you see a much higher percent increase when they add two or three people
than the city of Austin taking away two or three people. I think you are in
that same position. That's what we looked at. When we look at this, I first
look at 400% increase, there's like no way. Then you start looking into it.
And I still think the form on short form, there may be a need to look at certain
conditions by which you have a program that-some of those fees are absorbed
by the county in certain conditions. It's just something the policy needs
to be made by you guys what needs to be done there. One of our concerns and
I haven't seen it, but one of our concerns is that the Travis County is going
to become a reviewing entity similar to the city of Austin. In the process
-- and the process become as complex as the taus, the detail and level of
effort the same as the city of Austin puts in. It's not unusual dealing with
the city to go through and have them basically redesign the projects for you
and you are having to spend a lot of time going over there. In the past we've
had a very good relationship with the county. When we submitted a set of plans,
the engineers accepted it was coming from a professional engineer, a professional
set of plans and there was a effort that was put into review but it wasn't
the same extent as the city of Austin puts into their reviews. We don't want
to see the county going to that level. It's just a concern when the fees go
up to try to justify those fees you increase the level of effort you put into
the reviews. That will be a concern of ours. Finally, with the review fees
the way they are, some cities and counties across the state and country are
looking to go outside with those services and hire a consultant to come in
and handle those projects. It gives the county and the cities and the reviewing
entities to level off their staff and not deal with the ups and downs of the
economy as much. When the economy is good and lots of fees are coming in and
they can have more contracts going out, when the economy is going down and
not as many homes are being built, they don't have to lay off staff or raise
fees, they can simply deal with it on an outside consultant basis. Taken fees
at this level, it may become economically feasible for a consultant to do
some of those projects for you. So it may be worth looking into down the road.
>> yes, sir.
>> good morning, mary [inaudible], executive vice president
for the home builders association. I think one of the possible explanations
on what [inaudible] large costs on short form is by and large you don't have
professional officials coming in to do that and there may be more hand holding
required with that effort. I look at it from my association members' perspective
where, again, probably 95 to 99% of the development that's done is for larger
production builders or else professional develop thaers will turn around and
sell to a group of custom builders. Again, I think maybe the issue comes with
-- where you have an individual, probably a smaller builder or maybe an individual
homeowner or that person who has the trailer trying to do it themselves and
they come in where they need that more personalized attention are more likely
to have to do multiple resubmit also. Again, if there is a way possibly not
today but in the future that issue could be looked at. Maybe a smaller initial
fee, but more supplemental fees for multiple resubmissions for those trying
to do I again, I think -- just to reemphasize what hank says is there's a
social or a practical benefit from trying to encourage short form development
as opposed to leaving lots out there, legal lots and buying a legal lot, we
all know that doesn't carry the connotation that you think, but it's just
simply lots that haven't been properly platted. Thank you.
>> any questions?
>> questions? Did we commit to -- did we commit to sort of
monitor these fees, see what impact they are having over the next, say, six
, 12 months? Report back to the court? Whatever findings.
>> that's fine.
>> I just want to make first a comment and then I would like
to ask a question because I’m not sure I fully understand the position of
the industry. We had about 38 short form plats over the last three years so
roughly we got about 12 of them. 38 per year. Excuse me. But in terms of percentage
of total, it's not a significant -- most of our subdivision are long form
plats. I guess the question is if we monitored our unit price for the short
forms, is the industry suggests that we transfer that burden to long forms?
And is the industry willing to cross-subsidize so the people that can afford
to pay for the subdivision will lift off some of these costs on the short
form?
>> I would never say yes not only to about cross- subsidizing.
I think what [indiscernible] taxpayer benefit to that expedited short form.
>> I think the county has been subsidize ing this program
for years and there may be a way to continue that on certain short -- it's
not going to be a huge financial impact. Probably five to ten a year. I don't
think it's a big ticket item either way.
>> court members?
>> nice try, joe. [laughter] firefighters.
>> thank you all.
>> thank you.
>> thank you very much.
>> move approval.
>> second.
>> discussion? All in favor? That passes by unanimous vote.
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Last Modified:
Wednesday, October 26, 2005 3:15 PM