When San Antonio City Councilman Manny Pelaez (D8) listened to a report from the Mayor’s Housing Policy Task Force earlier this year he was struck by the group’s assertion that the first $25,000 of the cost of a house here comes from regulations.
He asked City staff for a fact check, and that report said the number was actually less than $15,000.
Regardless of the number, Pelaez realized that every regulation put in place affecting development in the city by all levels of government adds building costs for developers that are then passed on to buyers.
As Pelaez dug deeper and did more homework, he discovered the federal government as well as state and other city governments have rules in place that require new regulations be analyzed through the lens of the economic impact they will have if put into practice. San Antonio does not currently analyze proposed regulations in the same fashion and Pelaez thinks the City ought to consider it.
“That’s one of our duties is not to forget that every single one of our initiatives does have a cost attached and a burden,” Pelaez said.
Pelaez filed a council consideration request asking City Council to examine the City’s development regulations and their impact on development. The request was dated Aug. 14 but was discussed for the first time Wednesday during a governance committee meeting.
In his request, Pelaez said since the last Unified Development Code amendment review in 2015, several groups outside the purview of the Development Services Department have been formed for different purposes related to development.
Each of those groups is either in the process or already has made recommendations regarding regulations on new construction of homes and commercial projects in San Antonio.
Those groups includes the San Antonio Housing Commission to Protect & Preserve Dynamic & Diverse Neighborhoods, SA Tomorrow and the Mayor’s Housing Policy Task Force.
Pelaez is asking council to review the Unified Development Code review process, “taking into account all bodies that make development regulation recommendations and to determine the feasibility that each UDC amendment must include an economic impact analysis.”
The committee unanimously supported the request and directed Development Services Director Michael Shannon to begin identifying appropriate groups to have representation in discussing the issue. Mayor Ron Nirenberg said analyzing the issue could have some lasting positive effects on the city.
“What I hear him saying is he would like a cost-benefit analysis and stakeholder input on future regulations and changes to the UDC, which is a natural form and function of good business,” Nirenberg said. “We want to make sure that as we develop new policy, that we understand the positive and the negative and consequences to any of those decisions because they’re critical.”
Shannon said groups likely to be invited to participate include the development community, school districts, the military community, relevant city departments, neighborhood associations, and others.
Shannon said once the group of stakeholders is formed and a consensus is developed, the group will likely forward its recommendations to the comprehensive planning committee. Any changes passed there would require a vote of the full council. Shannon said it could take 3-9 months to complete the process, maybe longer.
“I think as we change our codes for a lot of good reasons, no matter if it’s every five years or throughout those years, it’s important to understand how those codes can effect the bottom line, the cost to the community, the cost to developers, the cost to the homeowner or business owner who is going to buy or build that building,” Shannon said. “So I think it’s more about having the information through the process so we can make good, informed decisions moving forward.”
Is it too late to do an economic impact analysis for the new requirement of parking with the adopted reformed IDZ? Parking regulations/requirements certainly add exhorbitant costs to a developer and, thus, the purchaser.
Identifying and eliminating costly and in many instances unnecessary regulations, is exactly what the President has been doing on a national level. Seems this city council is beginning to open their eyes
Kyle, development often ends up costing taxpayers money by way of subsidy, additional strain on infrastructure, flooding from impervious cover, devaluing surrounding properties, new utility construction paid for by ratepayers, etc. My question is, has the city done any studies to determine costs incurred by taxpayers as a result of development?
Actually, per the National Association of Home Builders, the average cost of government regulations on the price of a new home is $0.24 out of every dollar in the cost of a home.
Some of these programs in my opinion should be geared toward the working class, which the downtown businesses cannot do without. Hotel workers, cooks, attendants, retail, etc. In addition to reduced rent rates, the city could use other incentives so that developers can avoid carrying most of the cost. Incentives that can be used include, assistance with transportation, free VIA bus rides, Uber, Lyft and Scooter credits, to be used within the downtown proper. The added savings for the individual in avoiding an auto monthly payment, insurance, maintenance etc. should increasingly be used as an incentive to attract urban core living. In addition to the savings in transportation, the city should advertise how this will help in the reduction of pollution. Many people, especially millennials are interested in saving the environment, this would be a great enticement. Utility credits for urban dwellers is another tool the city should have at its disposal.
Until the long term environmental and health impact/costs is included within the economic impact formula, there cannot be a useful economical analysis.