Building Industry Association
of San Diego

NEWS l SAN DIEGO
City Unveils Two-Year Spending Plan
North County Times

ENCINITAS —- It’s got “a few haircuts” in places, but the city’s newly proposed spending plan for the next two years doesn’t include employee layoffs or eliminate any key city services, council members said Wednesday as they took their first look at the document. While council members mostly praised the spending plan, it didn’t win favor with the local Building Industry Association, which argued that the city was balancing its books in part by raising permit fees. That’s inappropriate given the troubled status of the construction industry, industry representatives told the council.

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NEWS | SAN DIEGO
Residential Building Permits Rise in March After Record-low in February
By JEN LEBRON KUHNEY, The Daily Transcript
Tuesday, April 28, 2009

The number of building permits for residential units issued in March throughout San Diego County was up significantly from both the prior month and the prior year.  The Construction Industry Research Board (CIRB) reported 524 total single- and multi-family units issued last month, almost three times the number issued in March 2008.  The 384 multi-family permits issued were more than 20 times the number of similar permits issued for January and February combined, while the 140 single-family unit permits were practically double those from February.  The increase is likely due to new home and resale activity picking up, as well as a change in policy in Chula Vista that allowed builders to defer their fees until they have a certificate of occupancy.  Typically, builders must pay their fees to the city before a permit is issued.

But in Chula Vista, the builder can pay the fees after a new home is sold, rather than having to pony up the money ahead of time.  In Chula Vista, there were only two residential building permits issued in January and February combined. In March alone, the number of permits pulled increased to 26.  “The numbers are very small, but it is meaningful,” said Building Industry Association of San Diego CEO Borre Winckel. “For the first time we see policy behavior, something [the BIA] encouraged and supported, result in actual permit activity and that’s what we’ve been talking to many, many cities about.”

While Chula Vista is the only city in the region to adopt the fee deferral program, Winckel said the BIA is working with other city governments to adopt a similar policy.  The increase in activity seen last month does not mean building will continue increasing as dramatically as it did from February to March “The drama in the figures is not so much in the percentage increase, because the percentage increase does not tell the story .” Winckel said. “What we’re seeing for the first time is what we call the ‘spring bounce,’ which we hoped would happen and is happening.

While the percentage changes in the number of permits is significant, they are still historically low. The 173 residential permits issued in February 2009 was a record low.  The spike in permits in March still leaves the total number of permits issued in the first quarter of 2009 lagging behind 2008 by 25 percent.  Winckel and other industry experts have predicted the number of permits issued in 2009 will be less than 2008 and continue to be soft through 2010. The CIRB expects the number of residential building permits issued this year to be about 50,000; 22 percent less than the 55-year low 64,752 issued last year.

NEWS l SAN DIEGO
City Contemplates Building Fee Increase
By BARBARA HENRY, Staff Writer – The North County Times
Monday, April 27, 2009

ENCINITAS —- A proposal to raise city building fees has drawn the ire of the region’s Building Industry Association, which is arguing the increase “will worsen and prolong the economic disaster” that builders are facing in the midst of a recession that has devastated the construction industry.

We are asking our members to protest a whopping 30% increase to certain user fees set by the City of Encinitas. Many of you have received a Crusader alert, asking you to to send a letter and to show up at Encinitas City Hall tonight (Wednesday, April 29th, at 6PM) as part of our ongoing JOIN Campaign.

Cities and other builder fee levying jurisdictions such as Water Districts, continue to balance their books showing shrinking revenues by raising fees on the very industry that resulted in their declining financial fortunes! This reality disconnect and its consequence of further job loss is alive and well in many jurisdictions throughout the San Diego region. Local governments still believe that the way to encourage economic health and to aid market recovery is to “get financially prepared” by raising fees now, WHILE THERE IS NO ACTIVITY.

The City of Encinitas saw only eight building permits pulled during the first quarter of this year! That raising fees will actually discourage any up tick in construction is a completely foreign notion in most public sector circles. Yes, many city halls are like the shop keeper who faces a mounting inventory of unsold goods raises his prices instead of holding a sale. And this is how Helix Water District which saw construction of 50 homes last year, recently raised water capacity fees by $10,000 per home to start funding a $27 Million capital expansion project. We cite this as evidence for the critical need of our members to help sustain the JOIN Campaign effort. Where JOIN has gone, the chance for beneficial change is greatest thereby benefitting our industry directly and our jobs.

As with Encinitas tonight, the JOIN Campaign asks the membership to turn out on:

May 12 in San Marcos at 6 PM
May 20 in Oceanside at 5 PM

Please sign up at www.biasandiego.org today!

BIA is going green to save your green by moving aspects of your magazine online. The printed version will be suspended for the remainder of this year. To keep our members fully informed, magazine articles and sections will be posted on our BIA BLOG in its own magazine special section beginning in May. The decision to suspend the magazine was not reached lightly as we know that many members placed a high value on this publication. Members will have more immediate access to timely information this way. 

Builder magazine advertisers and sponsors, don’t miss your chance for even greater exposure by advertising on our BLOG for less than your old rates.

Contact Lois@biasandiego.org today for special introductory rates.