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    6 Lege Guide SS17 Property Rights

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    The local government permitting process imposes significant burdens on property owners and private development through lengthy delays and onerous regulations. Regulatory delays added an average of 3.5 months to the permitting process in Austin, significantly increasing housing costs as rents rose much faster than wages. Exempting municipalities from the Texas Real Private Property Rights Preservation Act allows cities to impose costly regulations without consequence. The document recommends streamlining permitting requirements, prohibiting new regulations mid-construction, and applying the property rights act to municipalities to reduce undue regulatory burdens.

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    6 Lege Guide SS17 Property Rights

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    TPPF
    76 views2 pages
    The local government permitting process imposes significant burdens on property owners and private development through lengthy delays and onerous regulations. Regulatory delays added an average of 3.5 months to the permitting process in Austin, significantly increasing housing costs as rents rose much faster than wages. Exempting municipalities from the Texas Real Private Property Rights Preservation Act allows cities to impose costly regulations without consequence. The document recommends streamlining permitting requirements, prohibiting new regulations mid-construction, and applying the property rights act to municipalities to reduce undue regulatory burdens.

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    The local government permitting process imposes significant burdens on property owners and private development through lengthy delays and onerous regulations. Regulatory delays added an average of 3.5 months to the permitting process in Austin, significantly increasing housing costs as rents rose much faster than wages. Exempting municipalities from the Texas Real Private Property Rights Preservation Act allows cities to impose costly regulations without consequence. The document recommends streamlining permitting requirements, prohibiting new regulations mid-construction, and applying the property rights act to municipalities to reduce undue regulatory burdens.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    76 views2 pages

    6 Lege Guide SS17 Property Rights

    Uploaded by

    TPPF
    The local government permitting process imposes significant burdens on property owners and private development through lengthy delays and onerous regulations. Regulatory delays added an average of 3.5 months to the permitting process in Austin, significantly increasing housing costs as rents rose much faster than wages. Exempting municipalities from the Texas Real Private Property Rights Preservation Act allows cities to impose costly regulations without consequence. The document recommends streamlining permitting requirements, prohibiting new regulations mid-construction, and applying the property rights act to municipalities to reduce undue regulatory burdens.

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    of 2

    Texas Public Policy Foundation

    LEGISLATORS GUIDE TO
    THE 85th LEGISLATURE

    S P E C I A L S E S S I O N 2 0 1 7

    Property Rights and the Local Government Permitting Process


    The Issue new residents, and because of regulatory delays, rental costs rose
    more rapidly than wages. The types of codes and regulations that
    Current local government permitting is a lengthy, burden- businesses have to meet often dont have anything to do with the
    some, and complex process that infringes upon private property production of their product and force them to meet arbitrary and
    rights and violates the foundation and ideals that Texas was built expensive standards. If Texas seeks to continue its history of being
    upon. a free market state that protects the private property rights of its
    Overall, government regulations can comprise as much as 25 citizens, lawmakers should seek to reel in the burdensome and
    percent of a units final sales price. One reason for this cost is that unnecessary local permitting process.
    local governments often change permitting and development rules One reason cities can add these costs with impunity is be-
    midway through construction projects. Imposing additional regu- cause they are not subject to the Texas Real Private Property Rights
    lations in the middle of the construction process not only reduces Preservation Act (RPPRPA). Passed into law by the Legislature in
    the profit margin for builders, but diminishes the number of units 1995, RPPRPA allows property owners to receive compensation
    developed and raises the cost of housing and of operating a busi- for loss of property value due to new regulations on land use. Its
    ness. A builder can, for instance, purchase a lot, gather laborers authors sought a method of protection and a deterrent against
    and supplies, commence construction, and then be stopped mul- local government regulations that would damage the value of
    tiple times during the process in order to dismantle and redesign someones property. Since the act exempts municipalities, none of
    the structure to meet evolving municipal regulatory standards. For the cities zoning and permitting regulations are subject to RPPR-
    every occurrence where work is stopped and regulations require PA, rendering the act essentially ineffective.
    changes in the project, costs go up and time that could have been
    spent building additional units is lost. For buyers, this translates to The Facts
    higher prices and decreased selectionan undesirable outcome for
    producers and consumers alike. Meeting unnecessary criteria for the permitting process
    But it is not just changing the rules in the middle of the causes large delays of up to 6 months for businesses in certain
    game that makes housing and other projects more expensive. The municipalities.
    number of onerous regulations, repeated checks, and unnecessary A report done in 2015 found that in Austin regulatory delay
    reviews that businesses have to pass for permits generally causes adds an average of 3.5 months to the already 4 month long
    a huge delay within the approval process. In Austin, for instance, approval process.
    regulatory delay adds on average 3.5 months to the process, com- Austin is a very popular city to move to and because of signif-
    pared to just three weeks of regulatory delay in Denver, Colorado, icant regulatory delays in the Austin permit review process,
    or less than a week in Raleigh, North Carolina, suggesting that which stifles the production of new housing, between 2004
    Austin is dragging its feet in the approval of site plans. and 2013 average rents in the Austin area increased by 50%
    In Harris County, the approval process for business permits while median incomes increased by just 9%.
    can cause delays to opening for up to six months while trying to According to the National Association of Homebuilders
    comply with unnecessary provisions. In one instance, an individ- (NAHB), a nationwide survey of hundreds of single-family
    ual rented a space to make and bottle fresh juices, but was forced home builders found that government regulations represent-
    to have equipment and amenities completely unrelated to their ed 25 percent of units final sales price.
    business, such as grease taps and vent hoods. This caused almost The Texas Real Private Property Rights Preservation Act, in
    a two-month delay to opening. The effects of these regulations Section 2007.002, allows property owners to seek compensa-
    are not localized; they have far-reaching effects on the lives of all tion for any government action that reduces the market value
    individuals across the state. The tedious permitting process adds of private property by 25 percent or more.
    considerable time and costs to many sectors of the economy; it
    Recommendations
    hinders construction projects and imposes undue burdens upon
    entrepreneurs and companies. This results in delays, higher con- Reduce the regulatory burden that local municipalities like
    struction costs, higher housing costs, and higher prices paid by Austin have on businesses and building by lowering the time
    consumers, fewer jobs, and less economic growth. for approval and certain code requirements for permits.
    This difficult permitting process infringes upon basic private Prohibit municipal and county governments from imposing
    property rights by imposing costs on the applicant. These costs are new regulations or requirements after property owners have
    then transferred directly onto consumers as seen with the hous- acquired the necessary permits and permission to begin de-
    ing market. For example, Austin recently has had a large influx of velopment or construction.
    continued
    The Texas Real Private Property Rights Preservation Act should be amended to apply to municipal actions relating to the permitting
    process.

    Resources
    Heres what business owners have to say about city, county permitting processes by Danica Smithwick, Community Impact Newspaper
    (May 19, 2017).
    Affordable Housing Starts with Private Property Rights by Kathleen Hunker, Texas Public Policy Foundation (Nov. 2015).
    Quantifying the Impacts of Regulatory Delay on Housing Affordability and Quality in Austin, Texas by Megan Elizabeth Shannon, Univer-
    sity of Texas at Austin (May 2015).
    Zucker Final Report by Paul Zucker, City of Austin (April 2015).
    Austin renters face soaring costs in extraordinary market by Marty Toohey, Austin American Statesman (May 3, 2014).
    Private Real Property Rights Preservation Act Guidelines, Attorney General of Texas.
    Private Property Interrupted by Kathleen Hunker, Texas Public Policy Foundation (July 2014) .
    Time to Defend Our Property Rights by Bryan Mathew, Texas Public Policy Foundation (April 2017).
    Building a More Affordable Texas by Kathleen Hunker, Texas Public Policy Foundation (Jan. 2016).

    901 Congress Avenue, Austin, Texas 78701 | 512.472.2700 PH | www.TexasPolicy.com

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