City brings back permit fees for solar installations

The city will be able to hire more building inspectors with revenue that will come from restoring building permit fees for solar photovoltaic installations that have been waived for the last six years, Mayor Kirk Caldwell said Thursday.

The lost revenue was relatively insignificant when the city began waiving the fee in 2007 as a way to encourage homeowners and businesses to install PV systems. However, the amount has risen sharply in recent years with the explosion of PV installations, and city officials estimate lost fees for fiscal year 2013 will reach about $14 million.

"The bottom line is about fairness," said Caldwell, who signed a bill Thursday restoring the fee. "Everyone has to pay their fair share. We waived the fee at first, similar to what the state did with tax credits, to get people to put in PV. It has worked very, very well."

The cost of a building permit fee, which is about $740 for a $40,000 PV system, is not likely to have much effect on a homeowner’s decision on whether to install a system, Caldwell added.

The flurry of PV installations has resulted in a backlog of inspections that has caused permit delays for homeowners. In fiscal 2012, PV building permits accounted for 41 percent of the total permit workload in the department, up from 20 percent in fiscal 2011.

There were 698 permits issued for PV projects in fiscal 2009. By fiscal 2012 that had grown to 9,906 permits. Through the first seven months of fiscal 2013, the Department of Planning and Permitting issued 12,266 permits for PV installations.

The revenue from restoring the fee will allow the DPP to increase its staff, Caldwell said.

The city in September began offering online permitting for PV systems. Since then homeowners and businesses have filed about 7,100 PV permits online.

With more permits entering the queue, the pressure on inspectors to close the permits has increased.

"This is about trying to expedite the process," Caldwell said. "We have to make sure we have enough inspectors."