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New construction is down across the region
by AMANDA WINTERS
and MATTHEW NASH
Editor’s note: Third in a five-part series.
Sheila Roark-Miller attests to the construction slowdown.
Miller, director of the Clallam County Department of Community Development, where she has worked for 21 years, said she notices there are rarely lines at the front desk and even the phones are quiet.
The building division saw a staff reduction over the past few years, going from three full-time building inspectors to just one. The department’s building official and fire marshal have also have been laid off. But Miller said activity is so slow the reduction in staff is hardly noticeable.
Numbers tell the story best: Permits for single family homes went from 359 in 2005 to 114 in 2010.
Though the drop over the five-year period is steep, it appears to have leveled off, Miller said. Housing permits numbered 110 in 2009, and increased by four the following year. So far this year, 18 residential permits were issued.
The City of Sequim has seen a similar trend.
City housing permits plummet
Joe Irvin, City of Sequim interim planning director, was hired during the height of the building boom.
In 2005 developers applied for 190 single-family home permits inside the city limits, but from that point permits declined dramatically until the end of 2009.
“It’s amazing how many pre-applications we had back in 2005 and 2006,” Irvin said.
In 2006, new single-family permit requests began the gradual decline with 129 requests.
Irvin said he saw more signs of the decrease in 2007, when 110 permits were filed. In 2008, just 28 single-family home permits were filed, in 2009 11 were filed, and in 2010 there were 19.
“Starting in 2007 and 2008, the amount of time (I) spent with developers really decreased,” Irvin said.
Irvin pointed out that permits issued in 2010 led to important new developments, including Sea Breeze Apartments, an eight-building, 42-dwelling-unit facility now under construction on McCurdy Avenue south of U.S. Highway 101. The 16-unit Gornell Apartment complex is now being built next to Walgreens on Cedar Street.
“As far as 2011 ... we haven’t received permits like that,” Irvin said. “It’s more about zoning compliance issues. A lot of people are still doing feasibility studies.
“Residential is a sign of what’s going on nationally. The trend we’re seeing is not uncommon to other cities. It’s been interesting to see what’s still being built in Sequim even with those permits being pulled last year.”
He said construction in Sequim points to an emphasis on multifamily structures.
Irvin said through the current lull he spends much of his time answering questions about zoning.
Permit fees hold steady in county
Building permit fees in the county are based on a standard formula using the valuation of the new construction.
The last update to permit fees was in June 2007, placing the value per square foot at $94, Miller said, whether the house to be built is located on Bell Hill in Sequim or in Gales Addition in Port Angeles.
While updates are cycled every three years, the county commissioners discouraged a fee raise for 2010 due to the recession, she said.
Brody Broker, a broker with Jace The Real Estate Company, provided an example of the costs of building a home in the county based on the recent experience of a client who built house on two acres of “property with a view.”
Broker said the permit breakdown was as follows:
Building permit: $2,683.50
PUD water hookup: $4,145
For a total of $15,683 in county costs.
For the same house in the city, he said, the costs would be $22,000 and may soon climb to $25,000.
Broker also said the ongoing fees in the city for water and sewer services would be higher than the costs for a county resident.
Commercial lags behind
When asked about commercial building in the county, two current projects come to mind for Miller: the new Walmart Supercenter east of Port Angeles and the Price Ford development just west of that.
There’s not much else to mention aside from a mini-storage and beverage distribution center behind Deer Park Cinema built several years back and some school improvement projects.
Miller said even expressing initial interest in commercial development has waned. In 2008, the county received several project review submittals each month that included development proposals and inquiries about permitting.
In the spring there were three, with that number growing in the fall. But during the last three months of 2010 there weren’t any at all, Miller said.
“I’ve been here 21 years and what I’ve seen from the planning part is when the residential development declined, companies would take that investment and use it to make their own improvements,” she said.
Instead of building new homes and businesses, companies turn to self-improvement, Miller said.
One example is Everwarm Hearth and Home. Miller said the company used its own employees to remodel its facility at 257151 Highway 101 East, Port Angeles.
City commercial development
Though the numbers have fluctuated, the number of commercial permits in Sequim have also seen a noticeable decline.
In 2005, 21 new commercial permits were filed. In 2006, 10 were filed and 16 in 2007. Consecutive years saw seven, four and six permits filed.
No commercial permits have been filed so far this year.
“Commercial is riding the tidal wave pretty good,” Irvin said.
City permits, impact fees
To gain a better understanding of fees assessed to new developments, a hypothetical home was proposed to be built inside the Sequim city limits and out in Clallam County.
The 2,000-square-foot home has a 200-square-foot porch and a 400-square-foot attached, unheated garage. Its estimated value is $226,146.
In the city limits, estimated fees for building the home are as follows:
• General Facility Sewer — $7,800
• General Facility Water — $5,850
• Transportation Impact Fee — $2,893*
• Park Impact Fee — $1,975*
• Building Permit — $1,875.45
• Plan Check — $1,219.04
• Water Hook-up Fee and/or Inspection — $565
• 5/8 water meter package — $407.30
• Sewer Hook-up Inspection — $150
• Certificate of Occupancy — $100
• Sewer Backwater valve kit — $72.73
• Mechanical Permit — $23.50
• Plumbing Permit — $20
• Permit Fee — $15
• Sewer Backwater valve kit — Sales Tax — $6.25
• State Surcharge — $4.50
*Impact fees in Sequim went into effect June 1, 2010, after city councilors approved them on March 22, 2010.
The same home, if built in the county with a conventional septic system, would have the following county fees, which do not include well or PUD water hook-up fees, which are often substantial:
• Plan Check: $1,028
• Permit Fee: $1,582
• State Building Code Tax: $4.50
• Septic System Permit: $320
Compared to nearby cities and other retirement communities, Sequim hovers toward the upper-middle. If you were to build a 2,000-square-foot house with a 400-square-foot porch, no garage, in the following cities, the costs of city permits would be the following:
• Bellingham $31,000
• Sequim: $22,000
• Gig Harbor $30,000
• Melbourne, Fla. $15,000
• Port Townsend $8,500-$9,000
• Port Angeles $8,000-$9,000
• Sumter, S.C. $1,400 (Water and electricity hook-ups not included.)
Note: Melbourne and Sumter are both popular retirement communities.