The Texas Legislature has passed a bill that will allow Dallas to tap third-party reviewers when the City’s building permit process exceeds reasonable deadlines.
House Bill 14 allows third-party inspectors and reviewers to assist in the construction permitting process when a municipality fails to perform reviews or inspections within a timely manner.
Under the new bill, third-party reviewers will be able to conduct required development inspections 15 days after a regulatory authority fails to meet its prescribed deadline.
“With the full passage of House Bill 14, Texans are close to realizing the sort of reforms that will ease Texas’ housing affordability crisis and make it easier to achieve the American Dream,” James Quintero, policy director for Texas Public Policy Foundation’s Government for the People initiative, said in a news release.
While still too early to tell, HB 14 may end up being a major game changer for the City of Dallas’ Development Services Department (DSD), which regularly exceeds recommended review times for both commercial and single-family projects.
DSD’s median turnaround time in the first half of 2022 was about 35 days for most single-family projects and around three to four months for larger commercial projects, according to historical data from the City, as previously reported by The Dallas Express.
Review times are not the only component of a city’s development process that could see improvements due to the passage of HB 14. Housing prices should also come down, according to a description of the bill’s background and purpose.
In May 2022, the median Texas home price was nearly $350,000, according to the Texas Real Estate Research Center at Texas A&M University. Based on the median annual income at the time according to U.S. Census Bureau data, a home costing that much was simply beyond the means of most Texans.
However, HB 14 hopes to address this disparity by making houses less expensive. The National Association of Home Builders (NAHB) highlights how regulations have been shown to account for 25% of a home’s final price tag.
Not all interested parties were enthusiastic about HB 14’s movement through the legislature, however. In a letter to its representatives in the Texas Legislature, the Town of Flower Mound asserted that it was “concerned with the apparent lack of input from, and participation of, local municipalities, and professional organizations such as the Texas Chapter of the American Planning Association (TXAPA) prior to the drafting” of HB 14.
The Flower Mound Town Council wrote in April that “TXAPA offered … feedback for H.B. 14 and was ignored.”
According to Texans For Reasonable Solutions (TFRS), a non-profit organization focused on developing common sense solutions to problems such as housing prices and availability, HB 14 could result in savings of 15% or more on a home.
“The costs of land use attorneys, consultants and workers every month of waiting adds $$$ to the final price tag, passing this cost on to the consumer,” TFRS said in a tweet.
TFRS’s tweet claimed a 3.5-month delay in residential permit activity can result in a 5% increase in a home’s final price. Given that the typical site plan review in Austin lasts one to two years and five to six months in Dallas, costs can add up quickly.
“Major Texas cities currently struggle to meet their permit deadlines and maintain their staff,” said TFRS Founder Nicole Nosek. “HB 14 not only helps home buyers with lower priced housing, but it helps cities manage their workload for those that don’t have the resources to handle permit applications,” she told The Dallas Express.
Many in the development community have been clamoring for a more intuitive and speedy permitting process. Still, under Dallas City Manager T.C. Broadnax, the Development Services Department has struggled to achieve long-term improvements, as reported on extensively by The Dallas Express.
For every day a construction permit is delayed by the City, developers lose anywhere from $200-$300 per project.
The latest commercial review times show that DSD required 43 business days to complete most first-round reviews and 22 days for subsequent reviews, meaning DSD needed about 186% more time to complete a first-round review than its 15-day performance goal.
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