HomeMy WebLinkAboutDepartment of Planning and Community Development Third Quarter Report.pdfPage 1
Commission Memorandum
REPORT TO: Honorable Mayor and City Commission
FROM: Chris Saunders, Interim Director of Planning and Community
Development
Chris Kukulski, City Manager
SUBJECT: Department 3rd Quarter FY10 (January 1, 2010 to March 31, 2010) Budget
Update
MEETING DATE: April 26, 2010
AGENDA ITEM TYPE: Action
RECOMMENDATION: Move forward with current Planning Department staff levels per
FY10 Adopted Budget; continue to monitor revenue situation closely, consider adjustments to
application review fee schedule
BACKGROUND: Because of the anticipated difficulty estimating Planning Fee revenues and
workloads (planning applications) in FY09, we committed to make quarterly decisions regarding
staffing levels and operating costs in the department.
The Planning Department is funded by a blend of general fund, dedicated planning mil levy, and
application review fees. Page 6 contains the philosophy behind the development of the structure
of fees for processing of applications.
1. Monthly Application Fee Revenues of $14,000 minimum. The FY10 Budget was
balanced with the assumption that application fees would provide a monthly average of
$14,000 in revenue. This estimate is a continuation of the base minimum average used for
the last three quarters of FY09, and has been carried forward into FY10. This revenue
stream was for the staffing levels as they existed at that time. Presently there is one
vacant position for which recruiting is on-going.
Third Quarter FY10 Planning Fee Revenues were as follows, details of application
numbers and types are in Section 2.
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Actual Operational
Revenues
1st Quarter
FY10
2nd Quarter
FY10
3rd Quarter
FY10
Year to Date
1st month $19,859 $ 8,987.00 $16,871.86 $45,717.86
2nd month $10,173 $17,165.10 $11,756.00 $39,094.10
3rd month $10,933 $11,440.00 $13,462.32 $35,835.32
Quarter Total
Application Fees
Revenues
$40,965 $37,632.10 $42,090.18 $120,647.28
Average Per Month $13,655 $12,544.03 $14,030.06
The 3rd Quarter FY10 adjusted monthly average of $14,030.06 is above the
$14,000 target for average monthly revenues. For the quarter as a whole, this means that
permit revenues of $42,090.18 were very slightly above the $42,000 target.
Additional work items. The Department did not process applications for City property
development projects in the quarter.
The Department continued staffing the North Seventh and Northeast Urban Renewal
District Board now amounts to approximately ½ FTE. Examples of the work being done
include Depot Park, the bid for which was awarded by the Commission on April 5th, and
development of TIF funded programs to support public/private partnerships encouraging
redevelopment in the North Seventh Urban Renewal District. This relatively new, and
certainly expanding, role is unfunded.
The Department committed considerable time and effort in the 3rd Quarter, in cooperation
with Engineering staff, to develop a revised right-of-way encroachment program. This is
now in public review and before the City Commission. First reading was approved on
April 19, 2010.
2. Applications Received: The following table lists the planning applications that were
received each month of this quarter. In the 3rd Quarter of FY10, the department averaged
25 project applications / month (plus a total of 97 sign permit applications). In the
previous three months (2nd Quarter FY10), the department averaged 25 project
applications per month (plus a total of 89 sign permit applications).
The type of applications submitted for review varies by month. As described with the
previous quarterly report, there has been a shift in the application load away from large
subdivisions to smaller scale projects. Individual home related items such as a Certificate
of Appropriateness for a remodel or addition now make up a larger percentage of the
overall project review workload.
When the City Commission adopted the current fee structure , there was a deliberate
choice to collect a greater percentage of the cost of review from large commercial and
subdivision projects and a lesser percentage of cost from small scale projects. This
represented a commitment of greater general fund support for the ‘mom and pop’ projects
that did not generate revenue to their owners. As the work load has shifted by project
type, this has resulted in lower application fee revenues to a greater degree than is
explained solely by a change in the number of applications submitted.
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Application Type Jan 2010 Feb 2010 Mar 2010 3rd Quarter Total
Pre-Application 1 1
Prelim. Plat 1 1
Final Plat 1 1
Sub. Exempt. 1 1 2
Flood Plain
BOA (COA-DEV) 2 1 3
Admin. Appeals
Master Plan Amend UDO Amend CUP 2 1 3 6
ZMA 2 2
Conservation Update Entryway Update
PUD
PUD Final
Re-use 1 4 1 6
Annexation 2 2
Prel. Site Plan 2 2 4
Master Site Plan Final Site Plan 1 2 3
Mods to FSP 5 1 5 11
Informal 1 4 5
STUP 1 1 2
COA 7 15 17 39
Improvements Agree 1 4 5
Variance 1 1
Comp. Sign Plan 1 1
Condo Conversions 1 1
Code Enforcement 1 Monthly Totals 24 36 37 97
Signs 23 22 29 74
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3. Budgeted Expenditures: The Department’s FY10 budget is approved for an average of
$64,814 in expenditures per month ($777,768 for the year). Actual spending through
March 2010 averaged $59,592.63 / month, or 8% under budget. With 75% of the year
now past the Department has expended 69% of its budget. This includes costs associated
with Director Epple's retirement.
Past and Possible Responses to Revenue Changes
A. Utilize long range planning set aside:
In Commission Resolution 4111, a fee was adopted, as authorized by statute to help fund
the City’s long range planning activities. These are paid simultaneously with other
application fees. The relevant state law sections are provided below. Many of the
elements in the Commission’s adopted work plan will carry out policies and goals
established in the City’s growth policy and associated neighborhood plans. Staff is
working to carry out and complete those work plan elements at this time. For a more
detailed description of long range plan related work please see the City Manager’s report
on the progress of the work plan. Additionally, in this fiscal year the Department spent
considerable time and effort on the finalization of the Downtown neighborhood plan. For
these reasons, Staff includes the long range planning set aside to fund staff time in this
quarter. Quarter 3 revenues in this area are $3,095. This is equivalent to funding
approximately 124 hours in the quarter.
“76-1-410. Planning fees -- limit. (1) Governing bodies that have committed in a
resolution to adopting or that have adopted a growth policy that includes the provisions of
76-1-601(4)(c) may assess planning fees to pay for services that fulfill the purposes of
Title 76, chapter 1. The planning fees are in addition to any other fees authorized by law
and may be collected as part of either subdivision applications or zoning permits.”
“76-1-102. Purpose. (1) It is the object of this chapter to encourage local units of
government to improve the present health, safety, convenience, and welfare of their
citizens and to plan for the future development of their communities to the end that
highway systems be carefully planned; that new community centers grow only with
adequate highway, utility, health, educational, and recreational facilities; that the needs of
agriculture, industry, and business be recognized in future growth; that residential areas
provide healthy surroundings for family life; and that the growth of the community be
commensurate with and promotive of the efficient and economical use of public funds.”
B. TIF funding
As noted above, the Department is providing administrative support (approximately ½
FTE) to two of the City’s urban renewal districts. As requested by the Commission after
the prior quarterly report, Staff has verified that the N7th TIF district has $10,829
budgeted and Commission approved for part-time staff and professional services. Staff
recommends the Commission direct the use of budgeted urban renewal district funds to
help fund this level of staffing through the Department of Planning and Community
Development. An exact amount is not recommended at this time. It may be best to make
this analysis at the end of the 4th Quarter. Some of these funds are used for other services
besides Department staff. The NURB does not have an existing line item in their budget
for staff services.
C. Increase Planning fee levels based on audit findings, to more accurately cover the
costs associated with processing applications. A revised fee schedule went into effect
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on August 28, 2008. They had a positive effect on revenues throughout FY09 and
continue to do so in FY10. However, the fee structure does not reflect two years of wage
and operational cost increases. Therefore, cash revenues have not been consistent with
the amount of support intended to be provided by application fees.
In addition, the fees charged for the processing of sign permits are presently solely based
on building code fee tables, not the Department's adopted fee schedule. Most signs are
inexpensive compared to other construction and the present fee structure does not recover
reasonable costs for the time and effort involved in processing the applications. When
many large projects were being submitted with associated revenues this was not as
readily apparent as it is now.
The City Commission has given direction for Staff to bring back a revised fee resolution
in the Commission’s adopted work plan to adjust for changes in actual costs for
application processing and to incorporate a more proportional cost recovery for
processing sign applications. This would preserve the balance between general fund
support and application revenues executed by earlier Commission action. This will move
forward as consistent with the work plan.
D. Reduce FTE’s: Reductions in force occurred early in FY09. Reduced positions were 1
Planner Tech, 0.5 Admin Assistant, and 1 Workforce Housing Coordinator These
positions are not proposed to be filled in FY10. Positions for a Planner III and an
additional .5 FTE administrative position, both of which became vacant in FY09, are not
planned to be filled in FY10. This results in a 4 FTE reduction in overall staffing levels.
The Planning Director position became vacant through retirement at the conclusion of the
quarter. No vacancy savings were realized in the 2nd quarter of the fiscal year but are
expected in the 3rd and 4th quarters. The position is anticipated to be filled in the 4th
quarter of the fiscal year.
Workload for next quarter: While the national credit and finance problems are expected to
continue to have a negative effect on overall subdivision and building activity in the City, the
overall financial climate appears to be stabilizing. Building of new dwellings is up significantly
this year (46 dwellings) over the equivalent quarter period in 2009 (10 dwellings). Staff is
receiving an increased volume of inquiries about the development process. Several significant
reuses of vacant commercial spaces, such as REI, are positive indicators. Overall, much more
careful due diligence appears to be the practice so staff is spending more time consulting with
potential applicants before any items are submitted.
A number of items will affect workloads in the department in the 4th Quarter of the fiscal year.
· The retirement of the Planning Director has temporarily reduced staffing by one FTE.
Duties are being covered by the Assistant Planning Director. Adjustment of
workloads and responsibilities has been necessary. Interview and selection of the
replacement director is scheduled to occur in the 4th Quarter.
· Department staff have been participating in the development of medical marijuana
policy. A formal application to amend the development regulations is planned for the
4th Quarter.
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· Department staff expect to participate in the development of site plan application for
a revised FSP for the lower yards to relocate fire training equipment and to assist in
design of a new City vehicle impound yard.
· Construction on the new American Legion Building has commenced and is advancing
well. Staff anticipates more time spent in FY10 reviewing and processing re-
development applications with property owners affected by the blast. A formal
submittal for the reconstruction of the Rockin R has been approved and final site plan
submittal is expected shortly.
· Preparation and processing of text amendments as directed by the City Commission
will be undertaken in this quarter.
· The Planning Department is now fully engaged in staffing of two Tax Increment
Finance Boards. Upcoming construction projects and program preparation are
significant work elements.
· A number of major subdivisions in various stages of preliminary and final plat
approval continue to require a great deal of staff time to process requests for
extensions, improvements agreements, re-phasing, re-platting, and, in some cases,
working out details of financial guarantees taken over by banks. These subdivisions
include: Baxter Meadows; Meadow Creek; Legends II; Flanders Creek; and West
Winds to name a few. Staff will especially be dealing with the issue of remaining
improvements to be completed in many of these subdivisions throughout FY10. A
text amendment in coordination with the City Attorney’s office is a precursor to
addressing some of the outstanding items.
· Spring/summer is typically a busy season for applications for Certificates of
Appropriateness as home owners prepare for and execute summer remodeling
projects.
· Staff is presently working with two interns to create a digital summary of the historic
structures inventory. This project will position the City to more efficiently pursue an
update to the inventory as well as making the information more available to the
public. A grant for funding assistance in the inventory update has been prepared and
submitted.
· Long Range planning activities continue to occupy a significant amount of
Department time and resources in FY10. The Bozeman Community Plan, Bozeman
Economic Development Plan and the Downtown Neighborhood Improvement Plan
were recently completed. Implementation such as UDO text amendments, grants, and
other actions will require considerable staff time and resources.
Fee schedule philosophy and background: These concepts were originally documented and
accepted by the City Commission in March 2006. They were first implemented in Commission
Resolution 3904 and have guided fee updates since that initial adoption. These are applicable to
determining fees for processing applications.
The City hired the accounting firm of Anderson/ZurMuehlen to review the time commitment for
processing various forms of applications. The work was done in 2008. This study formed the
basis for the most recent fee schedule update, also completed in 2008.
1. Recover general operational costs attributable to development review for
Planning Dept.
2. Recognize that costs affect behavior and the City wishes to encourage some
behaviors and discourage others.
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A. Desired behaviors are: Annexation, Property improvements and removal
of non-conformities, compliance with generally applicable standards, and timely
completion of work.
B. Undesired behaviors are: Violations of standards, seeking of special
exceptions without compelling reason, and appeals of administrative decisions.
3. Relieve general taxpayer from costs originated by specific requests.
4. Comply with legal requirements affecting fee amounts.
5. Allocate costs throughout the development process so that expenses are
distributed to multiple points and reflect, to a degree, the ability of the applicant to
recover the costs through value added.
6. Special projects such as neighborhood plans, city-wide long range planning,
regulatory development, and code enforcement are to be considered independently
and mostly funded by the general tax base.
UNRESOLVED ISSUES: At this point there do not appear to be unresolved issues requiring
City Commission action at this time.
ALTERNATIVES: As the revenue for 3rd Quarter meets budget no alternatives are suggested
for action at this time.
FISCAL EFFECTS: With Q3 FY10 permit fee revenues at budget through the end of the 3rd
Quarter, and total expenditures below-budget, the Department is placing lesser reliance on the
City’s General Fund than anticipated in the approved FY10 budget. Third Quarter operational
revenues were $42,090.18 , with Q1-Q3 year to date operational revues of $120,647.28.
Uncertainty in permit activity in future Quarters is a concern as is the shift in the mix of projects
submitted, and warrants close monitoring in the FY10 and following years.
Alternatives to address a future cash revenue imbalance are suggested and described above in the
Response to Revenue changes section.
Attachments: None
Report Compiled: April 21, 2010
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