The Builders Association of the Twin Cities (BATC) engages in a variety of Public Policy efforts about and for the housing industry and ultimately the new home and remodeling customers in the region. Its efforts are focused on advocacy on behalf of its members and educating key audiences about housing issues, in particular, housing affordability, construction codes and defects, development and redevelopment.

In all cases, BATC supports regulatory policies that:

• are based in sound scientific findings;
• are connected to the actual costs of development;
• encourage and enable the broadest array of choices to meet the regions demand for residential construction units.

BATC looks to engage all stakeholders in the development and residential construction process, seeking to work together to achieve a better, more equitable regulatory framework. BATC is currently working on these key Public Policy issues.

BATC’S Position on Fees

Builders and developers expect to pay fees as they process their applications from concept to completion. They and their potential buyers also expect fees to be fair, reasonable and proportionate, with a nexus to the actual need or service provided. Because fees at all levels are passed onto homeowners as part of their purchase price, all parties to the development process must endeavor to achieve fairness in fees and dedications.

Fee Schedules – BATC encourages our member firms to obtain the most current fee schedule. Municipalities should make these easily accessible and up-to-date.

Transparency – Property owners and applicants should be granted reasonable access to municipal management and accounting documents to ensure that fees and escrow deposits are separately accounted for and not commingled with other funds.

Development Fees – Developers and builders may request, as part of the development agreement, that a municipality provide periodic reports detailing fees and costs incurred, and the amount drawn against escrow deposit. Fees related to staff or consultant time should identify the person working, time spent and hourly rate.

Annual Report – Since 2002, Minnesota has required all municipalities to report their building and development revenue and expenses. A few problems mar the effectiveness of this report:

• The report does not establish clear guidelines for municipalities how or what they should report.
• The report’s complexity inhibits analysis by interested parties who wish to understand fee activity.

BATC will continue to advocate for a better means and method by which municipalities can report their building and development permit activity to ensure fairness and transparency.

BATC’S Position on Development Agreements

Development agreements provide a level of flexibility to the developer and municipality when negotiating terms of a project. Those agreements also offer a fertile ground for superfluous concessions by a developer seeking to build. It is important that all parties recognize fairness in exactions and PUD requirements. BATC is seeking meaningful partnerships with local governments to standardize and refine the PUD/development agreement process.

General Authority of Local Government – Local government units have only those powers specifically granted to them by the Legislature. Case law has confirmed as much noting that local governments have no inherent power and possess only such powers that are expressly conferred by statute or implied as necessary in aid of those powers.

Developer’s Expectations – Like local governments, developers endeavor to keep agreements simple so all parties can understand the agreement clearly. A developer also will need sufficient detail to allow the project to proceed in a timely fashion. Finally, a developer and city must apportion liability to all parties in an equitable fashion.

BATC’S Position on Land Use Moratoria

A land use moratorium is a local enactment that temporarily suspends a landowner’s right to obtain development approvals while the community considers and potentially adopts changes to its comprehensive plan or other land use regulations. Sometimes known as ‘stopgap’ or ‘interim’ zoning, municipalities and counties implement a moratorium to halt development temporarily, pending the completion and adoption of more permanent comprehensive regulations.

A moratorium is a legitimate and valuable planning tool that allows local governments to take a thoughtful and informed approach to development and redevelopment.

BATC supports the legitimate purpose of moratoria when a community is engaging in studies to update and refine its local land use plans. However, affected parties should be notified in advance of such a decision, and the reach of a moratoria should be limited to applications that are submitted to the municipality after a moratoria is established. Most residential land use applications evolve through the concept phase for several months prior to submittal as a completed application, at a significant cost to the applicant. That investment of time and resources is unfairly threatened by an interim ordinance that can halt a pending application.

Notification – A standard, 10-day public notice shall be provided by the municipality or county prior to enacting an interim ordinance.

Existing Applications – Existing residential land use applications deemed complete by the municipality or county shall not be subject to the terms of an interim ordinance. Complete applications must be received by the municipality or county by the date of the publication of notice.

BATC’S Position on Stormwater Compliance

Changes in stormwater rules have made management and compliance a larger issue for all parties. BATC has been proactive in its efforts to educate all parties as a means to compliance, rather than rely on the strong arm of enforcement to gain compliance. Concerns remain regarding issues of affordability, duplicative and burdensome storm water regulations.

Stormwater Education Series – BATC has spearheaded an award-winning, comprehensive quarterly education program for general contractors, site superintendents, project managers, developers and regulators. The series complements the state’s NPDES Phase II Small Site Construction Permit. The program has been offered throughout the state to thousands of regulators and regulated. Regulators in the City of Rochester and Scott County have offered courses to builders and developers.

National Efforts – NAHB, BATC’s national affiliate is encouraging Congress to pass H.R. 5558 which would provide a more consistent and sensible regulatory approach that better protects America’s rivers and streams without unduly increasing housing costs or burdening businesses. The measure aims to streamline the permit process, improve compliance and enhance environmental protection.

BATC’S Position on Housing Affordability

While affordable housing is an operative word in many policy circles, BATC’s focus is on affordability in all housing. Affordability in housing is a daunting challenge in the face of cost drivers. It is a worthy challenge, the largest pools of expectant homeowners are buyers that are sensitive to the slightest adjustment in housing affordability. The National Association of Home Builders estimates that for every $1,000 in price increases 3,400 families are priced out of the market.

Regulatory Fees – The National Association of Home Builders estimates that 14 percent of the sales price of a new home is attributable to building and development fees. Without question there is a cost to local governments to administer and regulate homebuilding, but those fees must be carefully measured to reflect actual costs of the service or inspection. Long-term or large surpluses in local government coffers garnered from new homeowners are unacceptable.

Inclusionary Zoning – Mandatory IZ ordinances do not work in the market and are not authorized by Minnesota law. While IZ appears superficially appealing, the losses sustained by builders on affordable units must be made up by higher prices on the newly built market-rate units. The higher price is effectively a tax on new market-rate housing.

BATC’S Position on Zoning

Municipalities are given broad discretion to shape the look, feel and function of their communities. That fundamental element of local control is an opportunity for communities to grow in a unique fashion, but it is also can become an impediment to housing choices and aggravate efforts to promote housing affordability on an integrated, regional scale.

Beauty is in the Eye of the Beholder – Cities are increasingly pressured into making suggestions and decisions based on aesthetic appeal of housing applications. BATC recognizes the importance of aesthetics, but encourages local governments to be cognizant of the market demand for housing affordability. It sometimes happens that the ideal curb appeal might need to take a step back to allow for the most affordable product.

Balance is the Name of the Game – When neighborhoods are planned the questions can add up. Cul-de-sac or traditional street layouts? Width of the street? Where should the mailboxes be placed and how should they look? These are all legitimate planning questions and within the four corners of zoning authority. However, each of those questions should be posed against a backdrop that recognizes the affects on costs, housing choices and housing affordability.

BATC’S Position on Inspections

Timely and competent inspections are integral to the successful regulation of residential construction projects. The building code, land use inspections, stormwater and other environmental requirements comprise a significant portion of any development or building process. Professional interaction between builders and inspectors is vital for timely delivery of durable homes.

Helpful Inspection Information – A list of required inspections for specific land uses should be available to applicants at the time a building permit is issued. If there are prerequisites or sequencing requirements, they should be clearly stated. Any unique or special inspections should be detailed as such.

Timely Building Permit Issuance – BATC advocated for a mandatory 14-day response on a completed building permit application during the 2006 legislative session. Questions arose relating to some fine details and the relationship to the state building code, leaving the issue dormant for the year. However, BATC remains interested in a legislative directive that requires reasonable and timely responses to a completed building permit application.

BATC’S Position on Growth

Growth is a good problem to have. The Metropolitan Council continues to promote the fact that the population in the Twin Cities region will grow by one million people between 2000 and 2030. This is not a number taken lightly and is the basis for planning growth for our region carefully and equitably.

Regional Growth – All municipalities should shoulder their portion of new growth. Shared and coordinated growth is the only way to reasonably address the projected population increases. The Met Council’s comprehensive planning process allows for that coordination. Builders can meet the demand and provide an array of housing choices across the metropolitan area, but all parties need to be a partner participating in that process.

Housing Choices – Land costs and policy preferences have an affect on the diversity of housing types as does the market itself in the form of buyer preferences and demographic realities. BATC is committed to meeting the needs of the housing market of this region with responsible growth that accounts for cost, community preferences as well the needs and desires of those homeowners purchasing the homes. When each of those are accounted for in the planning process, a healthy market with appropriate balance in housing choices is most likely to occur.

BATC’S Position on Transportation

Adequate transportation infrastructure is vital to successful growth and redevelopment plans. Transportation and transit funding mechanisms are often mired in gridlock leaving growth and redevelopment patterns to operate without a clear picture of the transportation/transit priorities of the state and region.

Street Utility – BATC and the Association of Metropolitan Municipalities (AMM) forged a coalition in recent years to discuss street utility legislation that would provide collector street funding on a travel shed basis. Like other iterations of street utility legislation there is disagreement over the scope of the fee as well as the collection and spending nexus requirement. BATC retains an interest in this legislation as a means to provide revenue that is needed in a systematic and equitable fashion.

BATC supports the following street utility concepts:

• Language to ensure that a street utility fee is fair, reasonable, and proportionate;
• has a nexus to the need created by the development;
• is collected and spent within a designated travel shed;
• is limited to improvements to local collector streets;
• allows for advance funding agreements with a developer, where the developer is reimbursed with street utility funds as they are collected;
• clarifies that if such a fee is instituted, lack of transportation access and infrastructure cannot be a reason for denial of an application; and
• funds not used within 10 years of collection shall be returned to the applicant who paid the utility.