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Streamlining The Development Approval Process |
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Debra Bassert
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Over the years, numerous task forces and commissions have investigated how land development costs might be minimized by streamlining and better coordinating both development standards and the approval process for new homes. Several of the reports that have resulted from these efforts are noted in the accompanying sidebar.
Builders and developers of all types of housing and, more important, potential homeowners, are all affected by the increasingly high costs of developing land for home building. Builders and developers must pay interest each month on the money they borrow to purchase land and build homes. Needless delays in the approval process add to these overhead costs. According to the Land-Use Regulation Handbook (National Institute of Building Sciences, 1990), one study conducted in the early 1980s found that every month of delay in the approval process added 1 to 2 percent to the final price of a home.
The direct and indirect costs that stem from the delay and uncertainty associated with lengthy and complex approval procedures, numerous and often conflicting resource protection standards, and the fees assessed on development are all true costs that add to the consumer’s price of a home. These additional costs have the potential to affect not just the final product cost but project feasibility as well. The proportion of total costs added by processing delays and uncertainty is even greater for affordably priced housing, fundamentally affecting who can afford to purchase a home.
At a broader level, the impacts of the various direct and indirect costs on housing affordability have social equity implications. As the National Council of States on Building Codes and Standards (NCSBCS) notes in its March 1994 report Making Housing Affordable: Breaking Down Regulatory Barriers; A Self-Assessment Guide for States, "Regulatory barriers that unnecessarily raise the cost of housing or limit the supply of affordable housing have pernicious effects on our society, especially on those who do not have the wealth to live wherever they want . . . . Where you live—where you are able to live—provides you not only with access to jobs but also access to quality of education."
In addition, time is money even for the public sector. Multiple, overlapping, uncoordinated approval processes increase a government’s administrative costs. The NCSBCS report adds that a state’s own housing programs are affected by an approval process that bogs down, increasingly limiting what each subsidy dollar is able to achieve.
While everyone would like to see a single model development ordinance that could be recommended by states for use in every municipality, no single approach or document will work in every situation. A particular danger of model ordinances is the temptation to adopt them wholesale without incorporating the modifications needed to make them appropriate for the particular jurisdiction. That said, many of the studies and reports that have looked at streamlining the development approval process have reached similar conclusions and recommended similar strategies.
This article offers a comprehensive compilation of the ideas raised in various reports and studies (see sidebar) on how to streamline the approval process. It also draws on the experience of NAHB’s Land Development Services Department whose staff members review and comment on 50 to 75 ordinances each year. The following will be useful to interested parties working to achieve more effective, efficient, and less costly approval processes.
Initial assessment. The first step in any streamlining effort is to take stock of how long various approvals actually require in a given community, something of a "look in the mirror" to help identify where the approval process bogs down.
Presumption of approval. Presumption of approval is perhaps the single most important concept cited by reformers with respect to streamlining the development approval process. Overall, there should be a presumption that approval will be granted if development standards are met. Applicants should not be routinely forced into case-by-case reviews under the provisions of the special exception, conditional use, or planned unit development process. Case-by-case reviews should be an option, but not the norm, and they should be aimed at enhancing flexibility and quality, not stifling it.
Central permit information desk/one-stop permitting. All requirements and permits for land development should be initiated from one central location, thereby eliminating needless backtracking to various municipal or county offices. Employees who staff the permit information desk must be adequately trained in the details of all requirements and demonstrate the ability to answer the most frequently asked questions. They should be trained to see their role as facilitators—not adversaries—in the approval process.
Cross-training of staff. Cross-training of staff reduces specialization and thus enhances staff understanding of how various development standards and issues relate to each other. It improves coordination and helps expedite the approval process. It also increases the number of employees who are able to staff the central permit information desk.
Definition of key terms and use of simple, direct language. Vague or legalistic language is often difficult to interpret, particularly by lay planning commissioners with little experience or familiarity with land use issues. Terms and requirements should be as clear and specific as possible and should include criteria that guide the application of more flexible standards. Sections and standards of ordinances that relate to each other should be clearly cross-referenced. Quick-reference tables should be used wherever possible. These steps will benefit both the applicant and those who must administer and enforce the ordinance.
Ordinance approval process checklists and flow charts. Zoning and subdivision ordinances should spell out where to submit applications, which agency retains final approval authority, and what sequence to follow for various types of applications. Ordinaces should also specify the authority and responsibilities of each agency and government body involved in the approval process. Too often, ordinances outline individual stages of the approval process, but not the overall process from start to finish and how long it typically takes. Some communities publish process and permit flow charts either as separate brochures or guidebooks to the ordinance for distribution by a central permit information desk.
Clearly stated submittal requirements and appropriate level of detail in applications. As HUD suggests in its 1982 publication How Local Regulatory Improvements Can Help, "Do not require detailed design until the basic concept is agreed upon." It is important to distinguish between preliminary and final plan submissions and to set out when construction can begin. Practice varies across the country as to whether construction of improvements may begin after preliminary plan approval or final plan approval, and many ordinances are simply not clear on this point.
Clearly specified time frames/limits for reviews and approvals to ensure timely decisions. Vague and lengthy review processes and the failure of municipal staff to respond to development applications add delays that contribute unnecessarily to the cost of housing. Ordinances should specify when decisions will be made, such as 30 or 45 days after a public hearing on the project. Decisions should not be postponed indefinitely or tabled from hearing to hearing. Ideally, the ordinance should state that if the relevant agency does not make a decision within a specified time limit, the application is presumed approved.
Pre-application conferences. Pre-application conferences are one of the most effective tools in expediting the development approval process. Encouraging developers to meet informally with planning staff to present concept or sketch plans can help address issues and requirements before expensive technical and engineering work commences. Some communities require a conference; others make it voluntary. In no case, however, should a formal approval of sketch plans—even by staff—be required.
Interdepartmental review committees with designated coordinator/ ombudsperson. A single point of contact and appointed review coordinator, such as the planning director, can help coordinate reviews by multiple agencies and work out discrepancies in the comments received from those agencies. To be successful, the coordinator must have the authority to make final decisions when discrepancies arise.
Permit expediting/tracking. Computerized tracking systems permit staff to advise applicants of the status of their application and more readily identify coordination problems between agencies.
Concurrent rather than additive or sequential reviews whenever possible. Simultaneous reviews allow different steps in an application to proceed as a package or at least during the same time frame, thus reducing the time involved in sequential reviews. For example, the preliminary plan and rezoning applications for a planned unit development could be handled simultaneously.
Hierarchy of projects. Small and noncontroversial projects or particularly desirable projects (such as affordable housing) can be "fast-tracked" as administrative rather than legislative approvals by granting the planning director authority to review and approve them. In this way, the level of attention is commensurate with the level of project impacts, with valuable public and private resources devoted only to the review of projects that have a significant impact on the community. Alternatively or in addition, the number of requirements that apply to those projects can be reduced.
More decisions handled administratively by planning staff. Minor subdivision approvals and issues involving mostly technical, minor changes to submittals should be handled by planning staff.
Elimination of multiple public hearings. Often, a developer must present the same information at a series of public hearings before different commissions or boards. This practice is not only duplicative but also time-consuming and inefficient. In addition, the public does not need multiple opportunities to comment on a proposed project. A single hearing held by the planning commission or equivalent body can provide the necessary public perspective that, along with other relevant criteria, must be considered during the permit approval process. As a matter of course, most developers now hold meetings with neighborhood residents during the project proposal stage in order to solicit public reaction to the proposal. Early involvement of neighbors can minimize the necessity and cost of redesigning plans and specifications.
Self-certification of plans and/or inspections by engineers. Some communities have set up programs that train and certify registered consulting engineers who then certify that development plans and/or constructed improvements comply with local ordinance requirements. This approach reduces the burden on municipal staff and enhances the efficiency of the inspection and approval process.
Clearly specified time frame for inspection of constructed improvements and release of performance bonds or guarantees. The ordinance should clearly specify the terms and conditions for accepting the improvements constructed and financed by the developer, who must often post financial guarantees to ensure completion of the work. The ordinance should specify who conducts the inspections and in what time frame as well as the conditions for the subsequent full or partial release of the performance guarantees.
Combined inspections. Although the suggestion for combined inspections appears in reports more often in the context of building inspections, it is also relevant to inspections of required site improvements.
Ample time frame between approvals, with the possibility of extensions.
Some ordinances provide that preliminary approvals are valid only for a specific time period, typically a year; if construction has not begun or final plans have not yet been submitted within the specified period, the preliminary approval is no longer valid. The one-year time frame is increasingly out of step with the pace and complexity of most development projects. The best approach is to base the initial life of the preliminary approval on a realistic time period that reflects the size and complexity of the project. At a minimum, ordinances should allow developers to apply for extensions for additional periods of at least one year. Developers should not have to resubmit their entire project for approval.
Regularly updated/reevaluated ordinances. Over the years, many communities add requirements to ordinances without ever going back to evaluate whether the additions are consistent with existing requirements. Moreover, communities should periodically review requirements to ensure that they reflect current demographic needs as well as current development concerns and practices. State enabling legislation should include "sunset" provisions that require communities to conduct such reevaluations or face the expiration of their ordinances.
Simplified and reduced number of zoning districts. Consolidating zoning districts allows a greater range of uses and densities in each zone and reduces the need for and number of rezonings. It also builds more flexibility into the development process to accommodate new uses that were not envisioned at the time the original districts were created.
Encouragement of innovative techniques. Techniques that encourage more efficient and desirable land development should be encouraged through effective approval procedures. Many communities profess to encourage alternative site-planning options but then subject applicants to ever-longer reviews and uncertain standards. Cluster development and planned unit development should be allowed as conditional uses or as overlays to existing zoning districts—not as rezonings. Alternative lot arrangements, particularly for small lots, should be allowed. Density bonuses, cluster as a "by right" use, and expedited permit approvals can be used as incentives rather than merely allowed.
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Debra Bassert is a senior land use planner with the National Association of Home Builders in Washington, D.C., and has 16 years of experience in land use planning.