1. Leveraging the Approval Process to Get the Development You Want

2. Renewed Concerns About Housing Affordability
Many factors contribute to the challenge:
Plans that solicit jobs but don’t adequately provide for housing
Outdated ordinances that limit the range and mix of housing types
Increasing fees that add to housing costs
Environmental/growth controls that constrain land supply
NIMBY opposition to development
There is renewed concern about housing affordability now that building and development have resumed coming out of the Great Recession.
Although rapid increases in home prices took a pause during the recession, they are again on the rise.
There are many factors that contribute to the cost of housing, from outdated ordinances that limit the range and mix of housing types, to an array of environmental requirements at all levels of government that constrain land supply, to an ever-increasing array of fees imposed on new development.

3. A Factor Many Don’t Consider
Length and complexity of the development review and approval process
No longer 6 to 9 months but 1 to 2 years
As long as 4 to 7 years in some areas
One contributing factor that many people don’t stop to consider, however, is the length and complexity of the development approval process.
In many areas of the country, development approvals have gone from taking a few months to two years or more (sometimes many more) years to obtain.
It is not uncommon today to hear that it takes 4 to 7 years from start to finish.

4. Complex, Lengthy, and Unpredictable Process
Ties up developers’, builders’, and investors’ capital
Adds unexpected interest and carrying costs
Those add to cost of housing, at all price levels
Particular challenge for affordable product
Can even affect project feasibility
Also ties up public investment!
The land development review and approval process is an important component of the risk and expense of a housing
development project.
This lengthy process is often also unpredictable and ties up developer’s, builders’, and investors’ capital and accumulates interest expenses and other carrying costs before even one shovelful of dirt is moved.
These costs add significantly to the overall expense of housing, often without a commensurate benefit in return for the expense, and can even affect the very feasibility of a development project.
This presents an especially difficult challenge for affordably priced housing. With a lower return on investment, such projects suffer disproportionately from development fees and costs associated with regulatory delay. As a result, fewer affordable housing units get built.
It ties up public investment dollars, as well.

5. Reframing the Discussion
Old:
Streamlining techniques
Regulatory barriers removal strategies
New:
Process efficiency
Over the years numerous task forces and commissions have investigated how land development costs might be minimized through increased efficiency and better coordination of these review and approval procedures. Often this has been called “streamlining the process” or “regulatory barriers removal”.
With affordability concerns on the rise again, NAHB went looking for new reports on the issue and could not find anything since before the recession.
Based on the recent experience in Montgomery County, Maryland, we also decided to recast the issue as one of process efficiency, as the old terms have come to have a bit of a negative connotation.

6. Documenting the Process
First, we worked with developers across the country to put together a brochure on the many steps involved in the typical development process.
This was not easy, as there are about 4,000 municipalities in the U.S., and practices vary widely.

7. New Research for NAHB by Abt Associates
Frustration stems from
Complexity of the process
Lack of information about steps involved
Unclear how long each step will take
Process differs across municipalities
Then we retained the well-credentialed firm Abt Associates to help us take a fresh look at the issue. Abt compiled a comprehensive list of approaches currently being used across the country, based on an extensive review of popular and professional media, Internet searches, and interviews with practitioners, administrators, and industry experts.
Overall, what Abt found was that much of the frustration related to land development review and approval involves the complexity of the process and the lack of information about what the steps are, what documents need to be provided at each step, and how long each step will take.
The fact that most builders and developers work in multiple jurisdictions--each typically with different processes and requirements--compounds the problem.
The report covers a wide array of strategies being used across the country.
Most of these ideas are not new, but the report provides current examples.
The strategies were divided into seven different categories, with specific approaches included in each group.

8. Report includes: Information about each strategy
Multiple examples of communities using the strategy with links for more information
Examples of comprehensive system overhauls
Detailed case studies
It provides more extensive information about each strategy based on online and print documentation and telephone interviews with state and local officials and representatives from organizations such as local builders’ groups.
It also highlights several different locations under each strategy, to illustrate a range of places and strategies being used, often in combination. Both local- and state-level efforts are highlighted, and several document extensive overhauls of land development processes. Many include documented results as well.
The strategies are further illustrated in case studies located at the end of each section.

9. Time is Money for Government Too
Inefficient process increases government’s administrative costs
Reflects poorly on government competence and image
Creates perception of a negative climate for business
An efficient land development process benefits builders, developers, and most importantly, home buyers.
But time is money for the public sector, too. Multiple, overlapping, uncoordinated approval procedures increase government’s administrative costs and reflect poorly on government competence and image.
The Leesburg, VA, case study in the report is a very interesting story about how a high-profile business almost walked away because of the town’s permit process. The situation led to an overhaul that focused on better communication between agencies and with applicants, clearer signature authority for steps in the process, and a change in agency culture to encourage partnerships with applicants. The story had a happy ending, as the business decided to locate there.

10. Increased Process Efficiency is a Win-win for All
Developers and builders
Homebuyers and renters
Local government
Taxpayers
In short, increased process efficiency benefits municipalities, government staff, and taxpayers too and so is a win-win for all. It results in cost savings to government agencies by reducing redundant review and time-consuming procedures that have little added benefit.
It also improves staff morale and retention both by eliminating confusing and stressful procedures, and by improving relationships between review staff and developers.
It can also directly improve a local jurisdiction’s bottom line, as shorter review times bring in more revenues from development and allow the community to compete more favorably with neighboring jurisdictions for economic development.
It helps return foreclosed property to productive use more quickly and can facilitate developers’ ability to rapidly adjust a project to meet changing market conditions, rather than abandon plans altogether.
Celadon at 9th & Broadway, Stephen Whalen

11. Streamlining/Consolidating the Review Process
Overhaul permitting approval process
One-stop permit system
Increase coordination between agencies
Standardize interpretation
Change or update zoning to reduce need for variances
Combine public hearings
Here is a quick overview of strategy categories.
Again, many of these ideas have been around for a long time, but the report gives fresh and interesting examples of how they are being put into practice again coming out of the recession.

12. Increasing Staff Capacity
Maintain appropriate staffing levels
Hire specialized staff
Establish reliable mechanism for funding building services
Many local governments suffered a loss of staff during the downturn and are struggling with increasing workloads. The report includes many creative ways in which municipalities are trying to address this limitation to improve permit turnaround times.

13. Creating a Separate Process for Expedited Review
For desirable housing projects
Based on pre-approval
For an extra fee
Mayor de Blasio of NYC saw such a clear connection between an efficient land development process and affordable housing that he made it one of the key strategies for increasing production of affordable housing in the city’s housing plan created in 2014.
That plan sets a goal of creating and preserving 200,000 units of affordable housing over the next 10 years.
The plan calls for the city to take these steps, along with many others:
Reform codes and regulations to lower costs
Streamline interagency coordination to simplify and expedite the approval process
Provide greater predictability and transparency in the process
Speed up and improve coordination among agencies
Helm Place

14. Implementing Online Permitting
Online submission of plans
Real-time inspection updates
Here is one strategy that has come a long way since the last time we and others looked at it—online permitting.
Most communities today have the electronic capacity to do online reviews and to augment that with permit tracking systems as well.

15. Creating Accountability
Annual report on approval times
Online permit progress tracking
Customer satisfaction surveys
Tie employee advancement to performance
Limit review times
There are many good specifics in the report about the overall strategy of creating better accountability, but I’m going to let Bob Kaufman tell you more about it because the Montgomery County, Maryland, case study is such a great example of this.

16. Making the Process More User- Friendly
Comprehensive checklists
Development assistance department
Assist with quality of applications
Improve communication through regular meetings with developers
It can be immensely helpful to physically roadmap a local jurisdiction’s approval process, both to see where it bogs down, and also to give a clear picture of the steps involved and who has authority over them.
This can make the process less adversarial as well, as everyone is operating from the same page, so to speak.

17. State-Level Strategies
Regional authorities to provide assistance to local governments
State legislation on process
Provide resources to local governments
Although “all land use is local” is still true for the most part, because that is where development approval decisions are still made, states help set the stage for what goes on locally, through providing resources and assistance to municipalities, and/or through planning requirements established in state enabling authority.
Abt Associates found important progress being made currently in Washington, Massachusetts, and Utah, all of which have created state-level offices focused on improving the development permitting process. The State of Washington especially stands out because of the Lean Academy they have set up to offer training to local government staff.
In Massachusetts, public infrastructure grants are designed to facilitate housing and economic development, and a free permit tracking system has also been created for local governments to use.

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