Memorandum
City of Lawrence
Planning & Development Services
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TO: |
David L. Corliss, City Manager
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FROM: |
Barry Walthall, Building Codes Administrator
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CC: |
Scott McCullough, Planning & Development Services Director
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Date: |
February 14, 2012
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RE: |
2011 Year End Revenue and Expenditure Report
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The purpose of this memorandum is to report building permit fee revenues and expenditures for the Planning and Development Services Department, Development Services Division (hereinafter “DSD”), in regulating building activity in the 2011 calendar year. This report is required pursuant to Section 5-174 of the City Code. The Policy Statement adopted concurrently with the passage of Ordinance 8008 (hereinafter “the Policy statement”) provides specific criteria to determine the costs of regulating building activity. A detailed list of revenues and expenditures reasonably related to the regulation of building activity within the City is included as part of this report.
In 2007, the Neighborhood Resources Department merged with the Planning Department. The Planning and Development Services Department now regulates building activity within the City. Although some of the employee positions referenced in the Policy Statement have changed, this report is guided by the definitions in Section 5-174 of the City Code and by the Policy Statement.
Revenues
Building permit fees are collected for all new construction, remodel, electrical, mechanical, plumbing and miscellaneous building permits. Building permit fee revenue for 2011 was $713,951.
Additionally, DSD administers the contractor licensing program, for which licensing fees are collected. Administration of this program includes issuing new and renewal licenses, collecting and monitoring certificates of liability and workers compensation insurance, and monitoring contractor’s continuing education. Contractor license fees were received for both the 2011 and the 2012 license year at $65. Trades licenses are also issued by DSD for mechanical, electrical and plumbing trades workers at $20 for new licenses and $10 for renewals.
Revenue collected from licenses in 2011 was $71,635. Total 2011 revenues collected from building permit fees and license fees were $785,586.
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Type of Fee |
Amount |
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Building permit fees |
$ 713,951 |
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License fees |
$ 71,635 |
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Total Revenue |
$ 785,586 |
Expenses Reasonably Related to the Regulation of Building Activity
Section 5-174 of the City Code requires the Department, in determining whether a cost is related to regulating building activity, to be guided by the definitions in Section 5-174 and the Policy Statement adopted concurrent with the code provisions. To account for the merge of Neighborhood Resources Department with the Planning Department, the following table is provided setting forth the requirements of the Policy Statement and the employee positions and calculations used in the 2011 Year End Report.
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2006 Policy Statement Neighborhood Resources Dept. |
2011 Year End Report Planning & Development Services Dept. |
2011 Year End Report |
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100% salaries, benefits, including health insurance, taxes and retirement contributions paid by the City for the following positions: |
100% salaries, benefits, including health insurance, taxes and retirement contributions paid by the City for the following positions: |
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Plumbing Inspector |
Building Inspector II |
$ 87,500 |
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Mechanical Inspector |
Building Inspector II |
$ 82,858 |
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Structural Inspector |
Plans Examiner[1] |
$ 58,554 |
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Electrical Inspector |
Building Inspector II |
$ 87,081 |
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Inspections Supervisor |
$ 95,283 |
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Codes Enforcement Manager |
Building Codes Manager |
$ 102,832 |
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One Secretary/Receptionist |
One Admin Support III |
$ 38,244 |
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50% salaries, benefits, including health insurance, taxes and retirement contributions paid by the City: |
50% salaries, benefits, including health insurance, taxes and retirement contributions paid by the City: |
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Neighborhood Resources Director |
30% Asst. Planning & Development Services Director |
$ 29,444 |
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20% Planning & Development Services Director |
$ 36,090 |
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One additional secretary/receptionist |
One additional Admin Support III |
$ 25,405 |
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65% salaries, benefits, including health insurance, taxes and retirement contributions paid by the City: |
65% salaries, benefits, including health insurance, taxes and retirement contributions paid by the City: |
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Zoning Enforcement Ofcr. (site plan review) |
25% Code Enforcement Manager (site plan review position is vacant; the Code Enforcement Manager is performing essential functions of the vacant position) |
$ 23,962 |
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Budgeted Costs (utilities, supplies, janitorial, phone, parking expenses, uniforms, travel, continuing education, etc.) |
Same |
$ 46,711[4] |
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Capital Expenditures (in direct support of the regulation of building activity) |
Same |
$ 0 |
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Shared Rent – Neighborhood Resources Dept./Fire Dept. allocated at 27.5% to reflect amount of space used in regulation of building activity |
Same |
$ 18,002 |
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Fire Department: |
Same |
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10% of salary & benefits of Fire Marshall |
Same |
$ 12,550 |
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25% of salary & benefits of 1 Fire Inspection Officer |
Same |
$ 29,917 |
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5% of salary & benefits of 1 Fire Prevention Inspector |
Same |
$ 5,287 |
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Fire Administration |
Same |
$ 9,000 |
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Overhead Costs reasonably attributed to the regulation of building activity, allocated at a ratio of 9.05 (FTE employees engaged in the regulation of building activity) to the total number of FTE employees engaged by the City |
The ratio is adjusted with 2011 FTE employees #s (per Policy Statement) 2011 ratio = 8.65/761 |
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City Commission |
Same |
$ 664 |
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City Manager’s Office |
Same |
$ 7,664 |
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Administrative Services Dept. |
Same |
$ 12,638 |
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Finance Department |
Same |
$ 3,380 |
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Legal Department (including Municipal Court) |
Same |
$ 20,062 |
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Information Systems Dept. |
Same |
$ 8,552 |
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Total Expenses |
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$ 841,683 |
Annual Building Permit Fee Revenue Excess or Short Fall
Section 5-174 of the City Code requires the Year End Report to include a calculation of the total amount by which building permit fee revenue exceeds, or is exceeded by, the total expenditures reasonably related to the regulation of building activity. The 2011 annual revenue of $785,586 falls short of expenditures of $841,683 by $56,097 or by approximately 6.6%.
2011 Total Revenue: $785,586
2011 Total Expenditures: $841,683
Section 5-174 also requires that each successive year end report include a calculation of the Cumulative Past Overage Amount (CPOA). The CPOA is the cumulative total of the building permit fee revenue excess or shortfall for the previous calendar year (as reflected in the yearend report for that calendar year) and the building permit fee revenue excess or shortfall from all previously prepared year end reports. The CPOA can never be less than zero, and amounts from years previous to 2006 are not to be considered.
The CPOA for 2011 is:
2010 Cumulative Past Overage $0
Less 2011 Expenditures Exceeding Revenues $56,097
2011 Cumulative Past Overage Amount $0
The percent CPOA for 2011 as described in Section 5-174 is 0%.
2011 Revenue Short Fall
The 2009 reporting year was the first year since reporting began in 2006 that total cumulative revenues did not exceed expenditures. This trend continued in 2010 and 2011. For purposes of reporting 2011 annual building permit fee revenue excess or short fall, the CPOA and percent CPOA will be carried forward as zero. However, staff will also track the cumulative total of actual short fall or overage annually. The actual amount that expenditures have exceeded revenues since reporting began in 2006 is $299,658:
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2010 Cumulative Expenditures Exceeding Revenues |
$ 243,561 |
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Plus 2011 Expenditures Exceeding Revenues |
$ 56,097 |
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2011 Cumulative Expenditures Exceeding Revenues |
$ 299,658 |
Unrealized Revenue
Waived fees for affordable housing activities and public projects do not satisfy the definition of a building permit fee in Section 5-174 and are not included in the report as revenues received. There were six permits issued for affordable housing projects for which the City waived fees to provide for a “Matching Contribution” for grant funds received under the Home Investment Partnerships Program (HOME). The total amount of fees waived for these projects was $6,694.
Additionally, there were 17 public projects that would have resulted in fees in the amount of $34,997 in 2011. The City does not assess building permit fees for these public projects.
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Unrealized Revenue |
Number of Permits |
Amount |
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Matching Contributions for HOME grant funds |
6 |
$ 6,694 |
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Public Projects |
17 |
$ 34,997 |
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Total |
23 |
$ 41,692 |
During previous reporting cycles DSD has received public comment suggesting this unrealized revenue should be included in the calculation of the Cumulative Past Overage. Including unrealized revenue for matching contributions and public projects results in revenues of $827,278; this falls short of expenses of $841,683 by $14,405, or 1.7%, for 2011.
With unrealized revenue included, the percent CPOA for 2011 is zero.
Conclusion
Pursuant to Section 5-174 of the City Code, if the overage exceeds 20%, the department shall recommend to the City Commission a reduced building permit fee schedule. Cumulative overages for 2011 and previous years did not exceed 20%. Because the percent Cumulative Past Overage Amount does not exceed 20%, no action is recommended related to the increase or decrease in the building permits fee schedule.
Detailed 2011 Expenditures
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Utilities |
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2,024 |
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Office Supplies |
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1,811 |
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Books |
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2,112 |
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Other Supplies |
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4,810 |
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Training |
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2,386 |
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Vehicle Allowance |
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500 |
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Equipment & Vehicle Repairs |
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4,149 |
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Gasoline |
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6,628 |
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Janitorial |
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2,145 |
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Telephone |
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3,937 |
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Printing |
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480 |
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Uniforms |
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52 |
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Computers and Equipment |
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Software Licenses |
8,765 |
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Office PC replacement |
6,852 |
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Office Equipment |
60 |
15,677 |
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Total |
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46,711 |