This docum ent does not reflect the intent or official position of the bill sponsor or House of Representatives. STORAGE NAME: h0671.RRS DATE: 3/26/2023 HOUSE OF REPRESENTATIVES STAFF ANALYSIS BILL #: HB 671 Residential Building Permits SPONSOR(S): Esposito and others TIED BILLS: IDEN./SIM. BILLS: SB 682 REFERENCE ACTION ANALYST STAFF DIRECTOR or BUDGET/POLICY CHIEF 1) Regulatory Reform & Economic Development Subcommittee Larkin Anstead 2) State Administration & Technology Appropriations Subcommittee 3) Commerce Committee SUMMARY ANALYSIS The Florida Building Code (Building Code) must be applied and enforced uniformly and consistently across the state. Current law requires local governments to enforce the Building Code and issue building permits. The bill: Requires local jurisdictions to reduce their permit fee by 75% when the property owner or contractor retains a private provider for plans review or building inspection services. Shortens timeframes for the submittal, process, and review of applications for a building permit. Specifies when a permit application is deemed complete and sufficient. Provides that a local government can request additional information from an applicant twice unless the applicant agrees otherwise. Provides that a local government can request additional information once for certain residential dwelling building permits. Requires local jurisdictions provide an opportunity for an in-person or virtual meeting before a second request for additional information may be made. Specifies that certain permit requirements apply to single-family residential units and single- family residential dwellings. Requires that local governments follow certain prescribed timeframes unless a local ordinance is more stringent. The bill may have an indeterminate fiscal impact on state and local government. The bill provides an effective date of July 1, 2023. STORAGE NAME: h0671.RRS PAGE: 2 DATE: 3/26/2023 FULL ANALYSIS I. SUBSTANTIVE ANALYSIS A. EFFECT OF PROPOSED CHANGES: Current Situation The Florida Building Code In 1974, Florida adopted legislation requiring all local governments to adopt and enforce a minimum building code that would ensure that Florida’s minimum standards were met. Local governments could choose from four separate model codes. The state’s role was limited to adopting all or relevant parts of new editions of the four model codes. Local governments could amend and enforce their local codes, as they desired. 1 In 1992, Hurricane Andrew demonstrated that Florida’s system of local codes did not work. Hurricane Andrew easily destroyed those structures that were allegedly built according to the strongest code. The Governor eventually appointed a study commission to review the system of local codes and make recommendations for modernizing the system. The 1998 Legislature adopted the study’s commission recommendations for a single state building code and enhanced the oversight role of the state over local code enforcement. The 2000 Legislature authorized implementation of the Florida Building Code (Building Code), and that first edition replaced all local codes on March 1, 2002. 2 The current edition of the Building Code is the seventh edition, which is referred to as the 2020 Florida Building Code. 3 Chapter 553, part IV, F.S., is known as the “Florida Building Codes Act” (Act). The purpose and intent of the Act is to provide a mechanism for the uniform adoption, updating, interpretation, and enforcement of a single, unified state building code. The Building Code must be applied, administered, and enforced uniformly and consistently from jurisdiction to jurisdiction. 4 The Florida Building Commission (Commission) was statutorily created to implement the Building Code. The Commission, which is housed within the Department of Business and Professional Regulation (DBPR), is a 19-member technical body made up of design professionals, contractors, and government experts in various disciplines covered by the Building Code. The Commission reviews several International Codes published by the International Code Council, 5 the National Electric Code, and other nationally adopted model codes to determine if the Building Code needs to be updated and adopts an updated Building Code every three years. 6 DBPR Surcharges Current law requires all local governments to assess and collect a 1% surcharge on any building permit issued by their enforcement agency for the purpose of enforcing the Building Code. The local jurisdictions collect the assessment and remit the surcharge fees to DBPR to fund the activities of the Commission, DBPR’s Building Code Compliance and Mitigation Program, and the Florida Fire Prevention Code informal interpretations. 7 Current law also requires all local governments to assess and collect a separate 1.5% surcharge on any building permit issued by their enforcement agency for the purpose of enforcing the Building Code. The local governments collect the assessment and remit the surcharge fees to DBPR, where it is 1 The Florida Building Commission Report to the 2006 Legislature, Florida Department of Community Affairs, p. 4, http://www.floridabuilding.org/fbc/publications/2006_Legislature_Rpt_rev2.pdf (last visited Mar. 23, 2023). 2 Id. 3 Florida Building Commission Homepage, https://floridabuilding.org/c/default.aspx (last visited Mar. 21, 2023). 4 See s. 553.72(1), F.S. 5 The International Code Council (ICC) is an association that develops model codes and standards used in the design, building, and compliance process to “construct safe, sustainable, affordable and resilient structures.” International Code Council, About the ICC, https://www.iccsafe.org/about/who-we-are/ (last visited Mar. 23, 2023). 6 S. 553.73(7)(a), F.S. 7 S. 553.721, F.S. STORAGE NAME: h0671.RRS PAGE: 3 DATE: 3/26/2023 divided equally to fund the activities of the Building Code Administrators and Inspectors Board (BCAIB) and the Florida Homeowners’ Construction Recovery Fund. 8 Local government building departments are permitted to retain 10% of the amount of the surcharges they collect to fund participation by their agencies in the national and state building code adoption processes and to provide education related to enforcement of the Building Code. 9 Building Permit Delays Any delays in obtaining a building permit can delay the completion of a construction project. Delays in the completion of a construction project may: 10 Lead to increased costs for construction projects, which may be passed onto occupants of a completed project; Discourage construction, which can reduce the total supply of buildings in a community and may lead to higher rents in the community; Reduce property tax revenue to a local government and other taxing jurisdictions resulting from the delayed start and completion of a construction project; and Result in delayed occupancy of a project, including single-family residences and multi-family residences. Streamlining the process to obtain a building permit can accelerate the completion of construction projects. The goal of streamlining is to remove overlap and duplication and create more efficient administrative procedures while not reducing a building department’s ability to enforce the applicable construction codes. Streamlining the building permit process may: 11 Increase local government revenues by accelerating completion of a project and thus accelerating property tax collection; Create local construction jobs and other indirect jobs supported by local construction jobs, such as jobs at a material supplier, which may increase local tax revenue; and Encourage economic development by having an efficient permit system. Building Permit Application Review Time-Period to Review Current law requires local governments to review certain building permit applications within a specific time-period of receiving the applications. Current law has established time-periods for local governments to review applications for the following building permits: 12 accessory structure; alarm permit; nonresidential buildings less than 25,000 square feet; electric; irrigation permit; landscaping; 8 S. 468.631, F.S.; The Florida Homeowners’ Construction Recovery Fund is used to compensate homeowners who have suffered a covered financial loss at the hands of state-licensed general, building and residential contractors. Claims are filed with the DBPR, who reviews for completeness and statutory eligibility. The DBPR then presents the claim to the Construction Industry Licensing Board for review. s. 489.1401(2), F.S. 9 Ss. 468.631, and 553.721, F.S. 10 City of Austin Development Services Department, A Program for Expedited Permitting, http://austintexas.gov/sites/default/files/files/8- 9-2016_Report_on_Expedited_Permitting_Program.pdf (last visited March 23, 2023); PricewaterhouseCoopers, The Economic Impact of Accelerating Permit Processes on Local Development and Government Revenues, (Dec. 7, 2005). 11 Id.; Institute for Market Transformation, Streamlining Compliance Processes, (Winter 2012) https://www.imt.org/wp- content/uploads/2018/02/CaseStudy5.pdf (last visited March 23, 2023). 12 S. 553.792(2), F.S. STORAGE NAME: h0671.RRS PAGE: 4 DATE: 3/26/2023 mechanical; plumbing; residential units other than a single-family unit; multifamily residential not exceeding 50 units; roofing; signs; site-plan approvals and subdivision plats not requiring public hearings or public notice; and lot grading and site alteration associated with the permit application. When a local government receives an application for one of the above building permits, it must: 13 Inform the applicant within 10 days of receiving the application, what information, if any, is needed to complete the application. o If the local government fails to provide written notice to the applicant within the 10-day window, the application is deemed to be properly completed. Notify the applicant within 45 days of the application being deemed complete, if additional information is necessary to determine the sufficiency of the application; o If additional information is needed the local government must specify what additional information is necessary. o The applicant may submit the additional information to the local government or request that the local government act on the application without the additional information. Approve, approve with conditions, or deny the application within 120 days following receipt of the completed application. o This period is tolled during the time an applicant is responding to a request for additional information and may be extended by mutual consent of the parties. These time-periods do not apply when a law, agency rule, or local ordinance specify different timeframes for review of local building permit applications, for permits for wireless communication facilities, or when both parties agree to an extension. 14 If a local government fails to meet the time-periods above without an agreement for an extension of time, a local government is required to reduce a permit fee for any building permit application, including for single-family residential dwellings, by 10% of the original permit fee for each business day that a local government fails to meet the current statutory time-period for reviewing a building permit application or a time-period established by the local government. Local Government’s Requests for Additional Information 15 A local government may only make three requests for additional information from an applicant applying for the following types of building permits: Accessory structure. Alarm permit. Nonresidential buildings less than 25,000 square feet. Electric. Irrigation permit. Landscaping. Mechanical. Plumbing. Residential units other than a single-family unit. Multifamily residential not exceeding 50 units. Roofing. 13 S. 553.792(1), F.S. 14 S. 553.792(1)(a), F.S. 15 S. 553.792(1)(b), F.S. STORAGE NAME: h0671.RRS PAGE: 5 DATE: 3/26/2023 Signs. Site-plan approvals and subdivision plats not requiring public hearings or public notice. Lot grading and site alteration associated with the permit application. However, an applicant may agree in writing to waive the limitation that local governments may only make three requests for additional information for such permits. If a local government makes a request for additional information from an applicant for one the above building permits, and the applicant provides the information within 30 days of receiving the request, the local government must 16 : Review the additional information and determine the application is complete, approve the application, approve the application with conditions, deny the application, or specify the remaining deficiencies within 15 days of receiving the information from the applicant, if the request is the local government’s first request. Review the additional information and determine the application is complete, approve the application, approve the application with conditions, deny the application, or specify the remaining deficiencies within 10 days of receiving the information from the applicant, if the request is the local government’s second request. Deem the application complete and approve the application, approve the application with conditions, or deny the application within 10 days of receiving the information from the applicant, if the request is the local government’s third request. Prior to making a third request for information the local government must offer to meet with the permit applicant to attempt to resolve outstanding issues. If the applicant believes the request for additional information is not authorized by ordinance, rule, statute, or other legal authority, the local government, at the applicant’s request, shall proceed to process the application for approval, approval with conditions, or denial. If a local government fails to meet these deadlines it must reduce the building permit fee by 10% for each business day that it fails to meet the deadline. However, these time limitations do not apply when a law, agency rule, or local ordinance specifies different timeframes for review of local building permit applications, for permits for wireless communication facilities, or when both parties agree to an extension. Time-Period to Review Single-Family Residential Dwelling Building Permit Applications If any government entity with authority to enforce the Building Code receives an application for a building permit for a single-family residential dwelling, it must issue the permit within 30 business days of receiving the application, unless the application fails to satisfy the Building Code or the enforcing agency’s laws or ordinances, or unusual circumstances require a longer time-period for processing the application. 17 If the local enforcing agency does not issue a building permit for a single-family residential dwelling within 30 business days after receiving the permit application, it must reduce the building permit fee by 10% for each business day that it fails to meet the deadline. Each 10% reduction is based on the original amount of the building permit fee. However, the enforcing agency does not have to reduce the building permit fee if it provides notice to the applicant, by e-mail or United States Postal Service, within 30 business days after receiving the permit application, that specifically states the reasons the permit application fails to satisfy the Florida Building Code or the enforcing agency’s laws or ordinances. In addition, the written notice must also include that the applicant has 10 business days after receiving the written notice to submit revisions to correct the permit application and that failure to correct the application within 10 business days will result in a denial of the application. 18 16 Id. 17 S. 553.79(16), F.S. 18 S. 553.79(16)(a)-(b), F.S. STORAGE NAME: h0671.RRS PAGE: 6 DATE: 3/26/2023 After receiving the written notice, the applicant has 10 business days to correct the specifications written by the local enforcing agency and submit revisions to correct the permit application. If the applicant submits the revisions within 10 business days, the local enforcing agency has 10 business days after receiving such revisions to approve or deny the building permit unless the applicant agrees to a longer permit in writing. 19 A government entity does not have to reduce the fee for a single-family residential dwelling building permit, if: 20 it provides written notice to the applicant, by email or USPS mail within 30 business days of receiving the application; and The written notice specifically states how the application fails to satisfy the Building Code or the government entity’s laws or ordinances, and that the applicant has 10 business days after receiving the notice to remedy the deficiencies in their application or it will be denied. An applicant for a single-family residential dwelling building permit has 10 business days to address the reasons specified in the government entity’s notice. If the applicant submits revisions to the government entity within 10 business days of receiving the notice, the government entity must approve or deny the permit within 10 business days of receiving the applicant’s revisions. If a government entity fails to approve or deny the single-family residential dwelling building permit within 10 business days of receiving the applicant’s revisions, it must: 21 reduce the permit fee by 20% of the original permit fee for the first business day that it fails to meet the deadline; and an additional 10% of the original permit fee for each business day that it fails to meet the deadline, for up to five business days. A building permit for a single-family residential dwelling applied for by a contractor licensed in this state on behalf of a property owner who participates in a Community Development Block Grant-Disaster Recovery program administered by the Department of Economic Opportunity must be issued within 15 business days after receipt of the application unless the permit application fails to satisfy the Florida Building Code or the enforcing agency's laws or ordinances. 22 If any permit fees are refunded because a local government fails to meet an established deadline for reviewing a building permit application, the Department of Business and Professional Regulation (DBPR) surcharges for funding the Commission, the Florida Building Code Administrators and Inspectors Board (BCAIB), and the Florida Homeowners’ Recovery Fund must be recalculated based on the amount of the permit fees after the refund. 23 Private Providers Alternative Plans Review In 2002, section 553.791, F.S., was created to allow property owners and contractors to hire licensed building code officials, engineers, and architects, referred to as private providers, to review building plans, perform building inspections, and prepare certificates of completion. Private providers and their duly authorized representatives are able to approve building plans and perform building code inspections as long as the plans approval and building inspections are within the scope of the provider’s or representative’s license. 19 S. 553.79(16)(c), F.S. 20 S. 553.79(16)(b), F.S. 21 S. 553.79(16)(c), F.S. 22 S. 553.79(16)(e), F.S. 23 S. 553.79(16)(d), F.S. STORAGE NAME: h0671.RRS PAGE: 7 DATE: 3/26/2023 “Private provider” means a person licensed as a building official, engineer, or as an architect. Licensed building inspectors and plans examiners may perform inspections for additions and alterations that are limited to 1,000 square feet or less in residential buildings. 24 “Duly authorized representative” means an employee of a private provider identified in a permit application who reviews plans or performs inspections, and is licensed as an engineer, architect, building official, inspector, or plans examiner. The term does not include a person with a provisional license by the BCAIB. 25 If an owner or contractor opts to use a private provider, the local government must calculate the cost savings to its building department and reduce the building permit fees accordingly. 26 A local government may not charge a fee for building inspections when an owner or contractor uses a private provider but may charge a reasonable administrative fee which is based on the cost that is actually incurred by the local government, including the labor cost of the personnel providing the service, or the cost attributable to the local government for the clerical and supervisory assistance required, or both. 27 Effect of the Bill Building Permit Application Review (Section 3) The bill shortens timeframes for building applications. The bill provides that: after an applicant submits an application to the local government, the local government must provide written notice to the applicant within 3 calendar days after receipt of the application advising the applicant what information is needed to make the application properly complete. o The bill shortens the local government’s timeframe to respond to the application from 10 days to 3 calendar days. within 9 calendar days after receipt of the completed application, the local government must provide a written notice to an applicant that the application is insufficient to be approved and additional information is needed. o The bill shortens the local government’s timeframe to notify the applicant from 45 days to 9 calendar days. The bill removes the requirement that the applicant must submit the requested information from the local government within 30 days. The bill provides that the local government cannot request additional information from the applicant more than two times instead of three times, unless the applicant waives such limitation in writing. The bill removes the 120-day period which is tolled while the applicant responds to the local government request for additional information. The bill provides if a local government requests additional information from an applicant and the applicant submits the requested additional information to the local government, the local government must, within 9 calendar days (instead of 15 days) after receiving such information: Determine if the application is properly completed; Approve the application; or Advise the applicant in writing of information, if any, that is needed to determine the sufficiency of the application. o The bill removes the local government’s decision to deny the application until after the second request for additional information from the local government. 24 S. 553.791(1)(n) and (3), F.S. 25 S. 553.791(1)(f) and (8), F.S. 26 “Such reduction may be calculated on a flat fee or percentage basis, or any other reasonable means by which a local enforcement agency assesses the cost for its plans review or inspection services.” S. 553.791(2)(b), F.S. 27 S. 553.791(2)(b), F.S. STORAGE NAME: h0671.RRS PAGE: 8 DATE: 3/26/2023 The bill provides that prior to making a second request for information the local government must offer to meet in-person or virtually with the permit applicant to attempt to resolve outstanding issues. The bill requires that the meeting occur within 5 calendar days after the applicant notifies the local government in writing that he or she wants an in-person or virtual meeting unless the applicant agrees to a longer time period in writing. The bill provides that after the local government submits its second request and receives the information from the applicant, the local government must within 9 calendar days (instead of 10 days) determine whether the application is complete and: Approve the application; Approve the application with conditions; or Deny the application and provide the applicant with sufficient reason for such detail. The bill provides that if the applicant believes the request for additional information is not authorized by ordinance, rule, statute, or other legal authority, the local government, at the applicant’s request, shall proceed to process the application within 9 calendar days after the receipt of the request and approve, approve with conditions, or deny the application and provide the applicant with sufficient reason for such denial. The bill states that if the local government does not notify the applicant that the application is approved, approved with conditions, or denied within 9 days after the local government receives the additional information from the second request, the application is deemed approved. The bill removes the ability for a law, agency rule, or an ordinance to specify a different timeframe for the applicable building permit applications except when the timeframes set by local ordinance are stricter than the ones prescribed in the bill. Single-Family Residential Dwelling Building Permit Applications (Sections 1 and 3) The bill removes a provision in Ch. 533, the Florida Building Code, which requires single-family residential dwelling permits to be issued within 30 days unless the application does not conform to the Florida Building Code or local laws or ordinances. However, the bill incorporates the time period to review single-family residential dwellings into the building permit application to local government section. 28 The bill provides the following timeframes for single family or two-family dwellings or townhomes located within a master plan community for which the permit for the master plan has been approved under the local government residential master building permit program 29 : 1 calendar day after a building permit application is submitted to the local government, the local government must provide the building permit applicant with what information is needed in order to deem the application complete and ready for processing. If the local government does not provide proper written notice of what information is needed for the application to be considered complete the building permit application is automatically deemed completed and approved. Within 5 calendar days of receiving a completed building permit application the local government must determine if any additional information is needed to determine the sufficiency of a building permit application. The building permit applicant may submit the information or ask that the permit be processed without the additional information. A local government may only ask for additional information once unless the applicant waives such limitation in writing. If the local government requests additional information and the building permit applicant provides the additional information, the local government must act on the building permit application within 5 calendar days after receiving such information, unless the applicant waives this limitation in writing, determine that the application is complete and either approve, 28 See, s. 553.792, F.S. 29 See, s. 553.794, F.S. STORAGE NAME: h0671.RRS PAGE: 9 DATE: 3/26/2023 approve with conditions, or deny the application and provide the applicant with sufficient reason for such detail. o If the local government does not notify the building permit applicant that it has acted on the application within 5 calendar days the building permit application is deemed approved. The bill provides that a building permit for a single-family residential dwelling applied for by a contractor licensed in this state on behalf of a property owner who participates in a Community Development Block Grant-Disaster Recovery program administered by the Department of Economic Opportunity must be issued within 9 calendar days (instead of 15 business days) after receipt of the application unless the permit application fails to satisfy the Florida Building Code or the enforcing agency's laws or ordinances. Private Providers Alternative Plans Review (Sections 2 and 3) The bill provides that if an owner or contractor retains a private provider for purposes of plans review or building inspection services, the local jurisdiction must reduce the permit fee by 75% for not having to perform such services. The bill provides that if an owner or contractor retains a private provider for purposes of review, the following time periods apply: Within 3 calendar days of receiving a completed building permit application the local government must determine if any additional information is needed to determine the sufficiency of a building permit application. The building permit applicant may submit the information or ask that the permit be processed without the additional information. If the local government requests additional information and the building permit applicant provides the additional information, the local government must act on the building permit application within 3 calendar days after receiving such information, unless the applicant waives this limitation in writing, determine that the application is complete and either approve, approve with conditions, or deny the application and provide the applicant with sufficient reason for such detail. If the local government does not notify the building permit applicant that it has acted on the application within 3 calendar days the building permit application is deemed approved. Reduction of Building Permit Fees (Section 3) The bill provides that if the local government does not meet the deadlines set forth in this bill, it must reduce the building permit fee by 10% for each calendar day (as opposed to “business day”) that it fails to meet the deadline, unless the parties agree in writing to a reasonable extension of time. Building Permits; identification of Minimum Premium Policy (Section 4) The bill provides conforming changes based on the provisions amended in this bill. B. SECTION DIRECTORY: Section 1: Amends s. 553.79, F.S., relating to permits; applications; issuance; inspections. Section 2: Amends s. 553.791, F.S., relating to alternative plans review and inspection. Section 3: Amends s. 553.792, F.S., relating to building permit application to local government. Section 4: Amends s. 440.103, F.S., relating to building permits; identification of minimum premium policy. Section 5: Provides an effective date. STORAGE NAME: h0671.RRS PAGE: 10 DATE: 3/26/2023 II. FISCAL ANALYSIS & ECONOMIC IMPACT STATEMENT A. FISCAL IMPACT ON STATE GOVERNMENT: 1. Revenues: DBPR states that surcharge collections pursuant to section 553.791, F.S., and section 468.631, F.S., could be impacted by the bill. 30 2. Expenditures: None. B. FISCAL IMPACT ON LOCAL GOVERNMENTS: 1. Revenues: DBPR states that this bill may reduce the amount of permit fees that could be collected by local governments in certain circumstances. 31 2. Expenditures: This bill may impact local governments because they may have to hire more employees to meet the proscribed timeframes. C. DIRECT ECONOMIC IMPACT ON PRIVATE SECTOR: DBPR states that the bill may reduce the cost of permit fees paid by the private sector to local governments based on the local governments failure to meet time requirements. 32 On the other hand, the local jurisdiction may raise permit fees so that they can hire employees to meet the time requirements in the bill. D. FISCAL COMMENTS: III. COMMENTS A. CONSTITUTIONAL ISSUES: 1. Applicability of Municipality/County Mandates Provision: Not applicable. This bill does not appear to require counties or municipalities to spend funds or take action requiring the expenditures of funds; reduce the authority that counties or municipalities have to raise revenues in the aggregate; or reduce the percentage of state tax shared with counties or municipalities 2. Other: None. B. RULE-MAKING AUTHORITY: The bill would require the Florida Building Commission to amend the Florida Building Code to reflect some of the bill’s changes to building permit application processing requirements. 33 30 Department of Business & Professional Regulation, Agency Analysis of 2023 Senate Bill 682, p. 4 (February 14, 2023). 31 Id., at 5. 32 Id. 33 Id., at 3; see also rule impacted, r. 61G20-1.001, F.A.C. STORAGE NAME: h0671.RRS PAGE: 11 DATE: 3/26/2023 C. DRAFTING ISSUES OR OTHER COMMENTS: The short title is insufficient. It is currently called “residential building permits”, but the bill deals with all building permits. These timeframes may be difficult for local governments to meet and permit fees may have to be raised in order to cover the costs of employees needed to meet such time frames. IV. AMENDMENTS/COMMITTEE SUBSTITUTE CHANGES