Around 8 a.m. on Sept. 28th, Felicia Foster, a custom homebuilder and owner of Barron Custom Design, arrived at the city of Austin offices at One Texas Center with a plan to submit permit applications for four different projects. This type of visit is common in her line of work—but this time she had an audience.
Jennifer Turnbow, business process consultant for the development services department, or DSD, shadowed Foster alongside members of the city’s office of performance management.
Foster went from office to office, hurdling some minor stumbling blocks, including a delayed opening for Austin Energy at 10:30 a.m. due to mandatory staff training. She presented her stacks of paperwork and eventually finalized her application submissions around 1 p.m. The complex process is not unusual, according to Foster.
“Every single thing that could have come up during that process, did. All the roadblocks were there. All of the challenges,” she said.
Permitting an old Austin problem
Builders have long criticized Austin’s permitting process. But Turnbow’s presence that morning is a sign the city is listening. Her visit, which came about a month after she was hired with DSD, was a result of meetings the department had with members of the building community in January, which resulted in 64 recommendations to improve the process.
DSD Director Rodney Gonzales says those recommendations are part of an effort to build trust, improve customer service and show the city is hearing concerns builders feel have gone ignored in the past.
In October, DSD added 52 new positions for the upcoming fiscal year and increased its annual budget by $10.4 million to a total of $63.7 million. Those changes, Gonzales said, will give the department adequate resources to increase its efficiency.
“We really feel like we’ve got that baseline of staff to at least deal with Austin’s growth that comes into the future—deal with it in a way that it can be a measured response versus trying to swim upstream,” he said.
Builders say the mix of factors that created inefficiencies in Austin’s permitting process go back decades.
Geoffrey Tahuahua, vice president of Policy and Government Affairs at the Real Estate Council of Austin, said hundreds of amendments to the city’s land-development code have been written without explanation of what should take priority.
“If there’s an equitable process in the city of Austin it’s permitting. Everyone’s treated equally unfairly, and it’s equally slow,” Tahuahua said.
Stuart Hersh, an former city employee who now works as a consultant to help nonprofits with permitting and housing, said permitting was not always an issue in Austin, but revenue from the city’s growth beginning in the 2000s was not filtered back into development services, a mistake he says set the city back.
“We lost our way,” Hersh said.
Whatever the sources of the problems, Austin’s rapid residential growth in the early 2010s put the building permit issues into greater focus. According to a 2018 report from Charles Heimsath of Capitol Market Research, Austin added 41,672 apartment units between 2011 and 2015, more in four years than the number of units the city absorbed in the 10 years prior.
Then, on May 8, 2015, national consulting firm Zucker Systems released a damning 800-page assessment of Austin’s Planning and Development Review Department. The Zucker Report found the survey responses had “the most negative scores we have seen in our studies of 170 communities in 31 states;” and the department should receive an immediate $4.25 million in resources to turn around the issues.
Gonzales, who was the city’s deputy director for Economic Development and became the director of the newly created DSD after the Zucker Report was released, said the report was “a personal blow” to city staff. While many builders said they appreciate DSD’s efforts to improve in the years since, they say hurdles remain that make the process is as complex as ever.
Solutions are not one-size-fits-all
One significant stride DSD has made is the creation of the Expedited Building Plan Review program, which began last year. Expedited review, modeled on a program in Dallas, allows developers to pay an increased fee to have reviewers from multiple city departments together in one room, speeding up the permit process.
According to Brenda de la Garza, consumer services manager of the program for DSD, early numbers are strong. The expedited team has reviewed 720 total projects in its first year—357 residential and 363 commercial. Sixty-two percent of those projects have been approved in one cycle. However, the program has become so popular, that it has created a queue. For commercial projects de la Garza said the wait to meet with the expedited plan team is about eight weeks.
According to Tahuahua, many builders are willing to pay the expedited program’s fees in exchange for a better predictability. Next, he said, the city must translate that success to the department as a whole.
“We have to pay extra to get to the place where the process should exist today,” Tahuahua said.
While the expedited program may help builders willing to pay more, the development process remains a barrier to many homeowners and residents. Foster has created color-coded spreadsheets that outline the fees for projects her clients have completed in the past. One, for a client who built a 1,000-square foot accessory dwelling unit, shows a 390 percent increase in fees over the course of two years. She said another client who wanted to add a second bathroom and 54 square feet to a house faced $1,200 in permitting fees.
David Glenn, director of Government Relations and Policy with the Home Builders Association of Greater Austin, said challenges are different for builders of all sizes, but homeowners are hurt the most.
“The general public, the person who just wants to renovate their home, add a deck or build a pool, or what have you—they don’t stand a chance,” he said.
The process can be so intimidating for homeowners and small builders that an entire industry of experts—called permit expediters—exists to help those unfamiliar with permitting navigate the process.
Not all DSD’s fees went up Oct. 1. However, DSD did adjust its fees to match what it says is the cost of service for the work staff provides. That means the department projects it will take in $10 million more in revenue than it did last year to fund its services, including a second team on the expedited plan review.
Advocate for builders: ‘The ship has not yet turned’
While DSD’s mission is to facilitate development in Austin, it is not the only city department involved in the process. There are staff members from 15 different city departments involved in permit review, from Austin Water to the Austin Fire Department to public works and the law department.
Scott Turner, owner of Riverside Homes, said it has been an unwritten rule in the development community that whenever the city’s six-digit “512-974” phone number comes up, a builder has to drop whatever he or she is doing and answer the call because a missed call might mean a lengthy delay. The involvement of so many inspectors and plan reviewers, he said, is a major reason for Austin’s struggles.
“That process is so complicated, and it involves so many different approvals that aren’t managed under one roof at all. That’s what needs to change first and foremost in order to be able to then streamline the process without sacrificing policy or code, or health and safety,” Turner said.
Gonzales acknowledged that communication among each partner department in the development process is key. In 2020 many of those departments will move to a new building on Austin Community College’s Highland Campus. The new four-story building will have 60,000 square feet of space on each floor, helping to consolidate more city departments into one area.
The move is one step in what the city says is progress over the last three years. According to data from Capitol Market Research, the average building permit review time from the first permit processed to the final inspection dropped for both commercial and residential projects from 218 days in 2015 to 192 in 2016. That time period then fell again in 2017 to 137 days.
Glenn likened the place Austin is in now to the difficult task of altering the course of a cargo ship.
“We want to make it clear the ship has not turned, but there’s an effort underway. The captain’s giving orders now, and we’re waiting to see if the wind is going to turn the ship,” he said.