City Government
Boise Caters To Contractors–Again
May 6, 2009 
No lesson learned from the “Boise Pit,” Valley County’s Tamarack, or Avimore by Team Dave.
The latest move catering to contractors and developers of commercial projects simply defies financial logic. Mayor Dave Bieter is “deferring” building permit and inspection fees on new construction until an occupancy permit is issued. Also, impact fees for police, fire, and parks are being put off.
Like all the other band aid fixes for the economy, this one is full of potential pitfalls–like the above failed projects have proven. GROWTHOPHOBES will point out the LAST thing we need at this point in our economic situation is new construction competing with the existing inventory and getting special concessions to boot!
Development Services in the Planning Department is taking the biggest hit in the latest round of personnel cuts due to a slowdown in construction. If fees aren’t being collected, who pays for the inspectors, plan review, etc. ?
The GUARDIAN thinks if contractors are unable to afford the fees up front, they probably are not in good enough shape to start digging a hole.
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Comments & Discussion
Comments are closed for this post.
May 7, 2009, 3:34 am
Oh, c’mon, Guardian. You know they can afford to dig a hole (They just can’t afford to build anything in it).
Yeah, this is an idiotic idea!
May 7, 2009, 6:05 am
It seems bad decisions are being made by all. Is there any smart thinking going on?
May 7, 2009, 6:53 am
There is an old joke about a businessman who is losing $50 on every widget he sells. His plan to get out of the mess is sell even more!
That is Dave, and anyone else who tries to fix a problem by catering to the building industry.
Editor NOTE–It applies to commercial projects only.
The world economy was brought to a halt by the collapse of sup-prime mortgages. In layman’s terms – we, as a city, state, and nation, invested so heavily in real estate that prices collapsed, leading to defaults and bankruptcies on a global scale.
The last thing we need is anything that stimulates the housing industry.
May 7, 2009, 7:20 am
This policy is necessary because the city has developed budgets over the past few years that depend on growth to pay the bills!Bieter will do anything to encourage growth of any kind! “Growthophobes”, Growthalholics”, and now, “Growthophiles”. Maybe we need to re-evaluate???
May 7, 2009, 8:21 am
I suppose I can understand the logic behind offering these enticements to stimulate building.
However, protections can still be afforded via “Performance Bonds”.
Consumer advocates such as the Better Business Bureau regularly advise that “Performance Bonds” be demanded of contractors to insure that the first pieces of mail you receive at your new home or office aren’t liens.
Possession of said bonds by contractors insures completion of a project and /or compensation in the event of non completion and / or poor performance, with the issuing agency exercising uber diligence.
“Performance bonds have been around since 2,750 BC and, more recently, the Romans developed laws of surety around 150 AD, the principles of which still exist.”
America saw the passing of “The Miller Act” in 1935 and the subsequent adoption of “Little Millers” by many States, including Idaho’s § 54-1927.
With such an exceptionally long and distinguished history of protection, I am at a complete loss to explain why the City of Boise and it’s various quasi-governmental political fiefdoms such as the CCDC haven’t demanded Performance Bonds from developers.
May 7, 2009, 9:10 am
For a sobering view of the how wrong headed this action is on the part of the city, I strongly recommend checking the following link.
In six words. Record High Inventories. Record low absorption.
http://www.tokre.com/Webphotos/TOKmonthlynews/2009/01/0209_MarketUpdate.pdf
May 7, 2009, 9:10 pm
…and before the sub-prime housing crisis, we had an oil shock. Anybody remember watching the price of gas rise for years? Many believe the economy would still be humming along without the oil price shock.
Matt Simmons, arguably the world’s top oil expert, says the next oil price shock is only 3 to 9 months away.
America ceased to be able maintain its current infrastructure when oil prices crossed $45 per barrel. They are now considerably higher.
Cheap energy = wealth, it really is pretty simple. Growth is over, forever. We need not worry about it any more.
May 8, 2009, 2:37 am
MMfM:
Yeah, but don’t these performance bonds etc. require the business to put up some bucks?
Boise wants to cater to ones that don’t have any money but say they’ll come up with it somehow, then get right to work (digging The Hole, e.g.) even when they can’t pay the contractors etc. that are doing the work.
Eventually, everybody wants to get paid, and the one who was going to come up with the money for the project defaults, and …. yep, a Hole, or a small part of a (poorly) planned community, etc.
But Team Dave still falls for it over and over, and this is just one more step off the same cliff.
May 8, 2009, 12:39 pm
The guy in the picture is almost too scary to look at, with his braid so close to the saw. Not too smart.
May 8, 2009, 10:53 pm
I have to respectfully disagree with this thread. Any construction completed is worthless without a occupancy permit anyway. Why not collect the fee’s on the back end? It certainly doesn’t appear any of these salary paid P&Z employee’s are being overworked right now. If they are on the clock we might as well put them to work. I understand that the world of commercial real estate is a minority, but they are tax payers too. This also effects many small businesses involved in tenant improvements.
Put the fee’s back on the front end when the economy gets going again but until then I think it is a good idea. As tax payers we should look to get more value out of our tax dollars even if those tax dollars don’t affect us directly. And don’t worry you big govt lovers… once those occupancy permits are issued the tax man will cometh and right quick.