normalthings wrote: ↑Tue Dec 24, 2019 11:42 am
flyingember wrote: ↑Tue Dec 24, 2019 9:17 am
beautyfromashes wrote: ↑Tue Dec 24, 2019 12:33 am
Why are we charging for development plans anyway, especially if it is a significant amount? It seems if we want more development, remove every barrier or hinderance, no matter how small.
It's the cost of reviewing the plans for codes compliance.
It’s a way to make money. A project I was working on was quoted in the mid 7 figures for all of the plans and permits.
I really doubt they're making money off any project.
Let's assume this project takes four years of work from initial discussions through to occupancy permit and $5 million in fees. If we use a baseline of a standard 40 hour work week that's $600 per hour for the cost on average.
That seems low for the amount of work that would go into a big project.
Remember, the fees don't just cover the direct workers, they cover anything tangentially related. It's paying for accounting, marketing and such. It's also paying for their benefits.
Direct workers include the time the heads of departments spend on a project too. Permits will go to recover time they're never going to bill otherwise like taking meetings.
It's also covering failed projects. Any big developer is going to come with lots of ideas that don't pan out. So the cost of permits has to cover time spent on things that don't go in.
They're also likely used to keep other permit costs down.