Local development officials are seemingly upset that the City of Dallas charges some of the lowest building permit fees in Texas.
Dallas’ Economic Development Committee (EDC) asked the Development Services Department (DSD) to raise the prices it charges for construction permits to a level that allows the City to stay competitive with its neighbors while generating the necessary money to attract and hire skilled employees.
“I just want to make sure that this committee understands — this is about budget, it’s about money,” said Council Member Tennell Atkins (District 8).
“We charge less than anyone else. We pay less than anyone else. And you wonder why we can’t hire anybody. If you want to have top-quality engineers … we got to pay more money,” he said during the committee meeting earlier this month.
Despite having record-low permitting fees relative to cities like Arlington, San Antonio, Irving, Austin, Plano, and Frisco, many developers have been opting to build outside of Dallas. As previously reported by The Dallas Express, North Texas has been seeing a development boom and significant population increase, with many cities in the metroplex enjoying the benefits. However, developers have reportedly been showing less interest in Dallas — which lost residents in recent years — partly due to the burdensome regulations and slow permitting process that have been making the city more difficult to build in under City Manager T.C. Broadnax.
“We don’t want to be the highest and most expensive, but we do want to be in the ballpark and able to recoup and pay our employees,” DSD Assistant Director Vernon Young told committee members, as previously reported by The Dallas Express. “We want to make sure that we’re balanced out in that.”
This is the first year since 2015 that DSD has conducted a comprehensive fee study, following unsuccessful attempts in both 2018 and 2019 due to a lack of appetite for such a study at the time, according to Young.
“The development community still had issues with some of the ways we were doing permitting,” he said. “We think our services have been elevated, and we think there’s an opportunity to make sure that we’re capturing the fees that we need to and, at the same time, providing the service necessary.”
Although low permit fees could be viewed as an incentive to build in Dallas, Atkins said he believes the City is grossly undercharging developers.
“I just want to make it perfectly clear, we have not been charging enough money. If we had been charging the rate we should have been charging, we would not be in this situation,” Atkins claimed.
“I mean, other cities charge way more than Dallas, and they’re getting permits done, yet we’re charging less, and we can’t get permits out. We got to charge a fee,” he urged.
When Council Member Paul Ridley (District 14) asked if DSD anticipated substantial fee increases after completing its survey, Young said, “Not necessarily.”
“That’s where we need to drill down and be cost-effective and understanding for the homebuilders and for the commercial folks,” Young said. “It’s not that we want to be the most expensive fish in the pond.”
“Well, we want to cover our costs,” Ridley responded.
If DSD does increase its building permit fees, Atkins said the department should also raise its level of service to developers.
“I just want to make sure that colleagues and everyone know that we are below market with our fees and we’re getting below service because of the price. And the people got to understand, I mean, if we’re going to charge more, we should have more service and more quality to the service,” he said.