State Legislature triggers new residential building fees in Keller

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The city of Keller voted at its June 4 meeting to set construction fees for residential buildings at $0.84 per square foot.

The new rate was triggered by House Bill 852, which was passed May 21 by the 2019 Texas Legislature. Under the bill, cities may not base building permit or inspection fees on the value of a residential dwelling. It also cannot base fees on the cost of constructing or improving the building.

Prior to 2016, the city of Keller charged residential construction fees of $0.78 per square foot. In 2016, the city began collecting fees based on a residential building’s valuation.

Under HB 852, Keller is reverting back to charging residential construction fees based on square footage. It increased the rate to $0.84 based on inflation rates from the Bureau of Labor Statistics Consumer Price Index.

“A 3,500-square-foot house can be built for one value or have many amenities for a much higher value, but those amenities may not increase the staff time for plan review, inspections, et cetera,” said Julie Smith, community development director for the city of Keller. “A flat square footage fee may be more representative of the staff time required to review the property.”

The new fee is effective immediately. It does not impact commercial construction fees in the city.

The change is not expected to significantly impact the amount of residential construction fees collected by the city, Keller City Manager Mark Hafner said at the meeting. If the fee is not generating enough revenue, Keller City Council can adjust it when the city budget is passed each year.

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