HARWICH — Selectmen continue to wrestle with the cost of permits as the town looks at bringing fees in line with the costs of running the building department.
The topic has drawn some interesting debate, and selectmen could not come to a conclusion on increases in fees recommended by Building Commissioner Raymond Chesley.
Over the past three weeks selectmen have been debating an increase in building department permitting fees based on a study conducted by Chesley after it was recommended the department examine its fee structure. A study of 10 Cape communities determined Harwich charges 57.2 percent less than the average of the surrounding towns.
Chesley recommended fee increases, pointing out the last time fees were increased was in 2012 when a 5 percent increase was added to cover the cost of computer upgrades in the department. The last time there was an actual base fee increase was in 2007.
Selectmen have wrestled with fee increases throughout 2018. They deciding three weeks ago to continue the public hearing on the building department fee scheduled because they wanted additional information. Last week they rejecting a motion to increase fees by a 3-2 vote, with the debate focusing on the of use of fees versus taxes to cover the department's budget.
Town Administrator Christopher Clark said the building department fee issue will be brought back to selectmen again, likely in later September after some of the issues raised in the hearing are examined.
“I don't think necessarily it was a vote against fees themselves,” Clark said.
In last week's session Clark said a market analysis was done and the proposal put forward was in compliance with the Emerson College V. City of Boston Supreme Judicial Court decision that differentiated fees from taxes and established the three-prong test for fees. Both Clark and Finance Director Carol Coppola said the proposed increases meet the requirements of the Emerson case.
She said the fees must be for a particular benefit or service and must be paid by choice. The fees must also be used to defray expenses. Coppola said the current building department revenue from permit fees is less than building department operating costs. Building department expenses for FY19 are $606,732, including salaries and wages, benefits and insurance and expenses are factored into the expenses. Building department revenue projected in FY19 is $421,750, $184,982 less than expenses. The goal, she said, is to fund the operating costs of the building department with user fees.
Selectman Donald Howell had led the charge for additional information, wanting to know the actual cost associated with the issuance of a permit. He argued fees could not be increased based on what other communities are charging. He wanted to know what it cost the town to issue the permit and whether they are covering that cost.
Chesley pointed out it is pretty difficult to determine the exact cost associated with the issuance of a permit because so many hands come into play in the permitting process.
Among his proposals were increases in commercial building from $0.50 to $0.75 per square foot; new dwellings and additions from $0.35 to $0.55; and unconditioned accessory structures from $0.25 to $0.40 per square foot. Technology fees would increase from $55 to $75 and re-inspection fees would go from $55 to $75.
Board of Selectmen Chair Julie Kavanagh said she thought the proposed costs were comparable to other towns and she emphasized the need to support the department.
Selectman Michael MacAskill said the building department is operating fine funded with taxes and fees. Selectman Ed McManus disagreed, saying they are subsidizing the department with $184,000 in taxes.
The tax versus fee issue became a focus of the conversation. Leo Cakounes wanted to know if the board had voted a formal policy to have fees pay the entire cost of departments.
“That's a very dangerous statement up there,” Cakounes said. “You're taking out of this pocket, but you are reaching into that pocket.”
Cakounes said in the near future he and his family will not be able to stay in town because of rising taxes and fees. He said “ambulance fees let the camel's nose under the tent” 20 years ago and he objected to the continued practice of using fees to supplement town costs. He objected to a 57 percent raise in building department fees.
“I won't stand for it and neither will the other taxpayers,” Cakounes said.
McManus said several departments – golf, water and harbors, for instance – have been directed to cover costs through fees, and the more they do that, the less pressure will be placed on taxpayers.
“Less pressure on taxpayers is something you hear a lot about so the more you do it, the less squeeze there is on them,” McManus said.
Clark said he has heard from this board and past boards that they should be charging fees where it makes sense to do so.
“There is fundamentally nothing wrong with having user fees for direct benefits,” former selectman Larry Cole said. “When individual recipients benefit there is no reason taxpayers should be paying for them.”
McManus offered a motion to approve the fee increases for the building department. Howell made one last push for clarity in the cost associated with issuance of a permit. Selectmen Larry Ballantine, MacAskill and Howell voted against that motion. McManus and Kavanagh supported it. With the motion defeated it was agreed they would continue to look at the fee issue in future meetings.