Brownlee demands answers over consent fees
Gerry Brownlee is demanding an explanation for Christchurch's planned hike on consents charges.
Yesterday, the city council warned that the minimum cost of getting a building consent for a new home in Christchurch could almost double from July.
It came after a review of consent fees by Crown Manager Doug Martin who proposed a new fee structure to better reflect the complexity and time taken to process consents in the post-quake environment.
This morning Brownlee said he wanted a full report on the rationale for the increase given that building new properties would itself increase the council's revenue.
"As you are seeing such a huge replacement of housing stock in Christchurch, the rates that are levied against there properties are going to significantly increase," Brownlee said.
He knew of a case where a new house where one had previously been demolished would see a rates increase from about $3500 to more than $8000.
"So there is a huge cash flow benefit to Christchurch City Council. I would have thought in the normal business sense, consents are an investment in your future cash flow. So I'm going to be asking the Crown Manager for an explanation about that."
Brownlee also questioned the way the proposed increase was announced, saying he was "somewhat surprised that the Crown Manager was making an announcement that should have been made by the Mayor''.
CONSENT CHARGES MAY RISE 89 PER CENT
Under changes that city councillors are considering including in the draft 2014/15 Annual Plan, the minimum application fee for a residential new build with a value of $100,000 to $300,000 would increase from $1750 to $3310 - an 89 per cent increase*. That charge is designed to recoup the full costs incurred and includes the cost of eight on-site inspections.
Applicants would have to pay extra if more inspections were required.
The cost of obtaining commercial building consents is also set to skyrocket, with the minimum fee for a project over $1 million proposed to more than double from $5259 to $13,920.
Councillors are also being asked to consider raising other fixed service fees within the building control unit by 17 to 18 per cent and increasing the standard hourly charge-out rates for building consent/control officers by a similar margin. That would lift the hourly rate for a level 1 building consent officer from $140 to $165, while the hourly rate for a specialist building consent officer would increase from $240 to $280.
A council officer report on the proposed new fee structure says a high-level benchmarking exercise has been undertaken to determine what other councils which have a significant level of new residential building activity within their region are charging.
For the purposes of the exercise, each council was asked what the full building consent costs would be for a single-storey 200sqm house built to a national home builder's standard design with a project value of $350,000.
The results showed Auckland Council charged $4648, Ashburton District Council $3530, Tauranga City Council $3263, Queenstown Lakes District Council $2735 and Nelson City Council $2700.
Under the proposed new fee structure the consent cost for the same build in Christchurch would be $3850.
Brent Mettrick, managing director of Stonewood Homes, one of Christchurch's largest home building companies, said the increases were "totally inappropriate".
He did not expect the increased fees would lead to a better service as he was unsure the council was capable of doing so.
"The costs are out of line with other councils," he said. "We work across 70 other territorial authorities."
The new fee structure was inappropriate for a "less than average service" from the council, he said.
Commercial property developer Antony Gough said he expected developers would be unhappy with the proposed fee structure.
"It is hard enough getting buildings up without council looking to charge substantially higher fees," said Gough, adding that developers would want proof the council was only seeking to recover costs through its new fee structure and not trying to raise a profit before they accepted such large increases.
"Building consent is not about getting money in," Mayor Lianne Dalziel said yesterday. "We charge what it costs."
Council Acting Chief Executive Jane Parfitt said if the proposal was accepted, the fee changes would coincide with improvements to the building consents systems at the council.
"The level of service will increase and it is expected that the system improvements - which would result in time improvements - will make the cost of gaining a building consent similar to what is being paid today."
* Our original version of the story described this as a 189 per cent increase. This was incorrect.
New fees for residential builds:
Over $100,000 to $300,000, $3310 (up from $1750)
Over $300,000 to $500,000, $4290 (up from $2250)
Over $500,000, $5570 (up from $3250) Proposed new fees for commercial builds:
Over $100,000 to $500,000, $5680 (up from $3250)
Over $500,000 to $1 million, $9140 (up from $4250)
Over $1 million, $13,920 (up from $5250).