Increased fees on developers are reasonable

For more than a decade, the city has not increased fees for a raft of land-use services involving permitting and paperwork. But now, with a massive development wave surging through Oahu, the time is ripe for the city Department of Planning and Permitting (DPP) to enact modest increases in processing fees to handle the growing workload for a variety of large-scale land-use applications.

Hawaii’s cyclical building industry is about to boom again, after years of slowness due to the recession and Hawaii’s weakened economy. With the rise in activity will come greater demand on the city DPP for project reviews, plan sign-offs and processing of permits.

Here’s the thing: All these services cost. Mayor Kirk Caldwell said the review work done by DPP on larger projects would incur tens of thousands of dollars in the private sector. These are impactful projects that necessitate thorough review, and this is a justifiable uptick in developers’ costs of doing business. Those who stand to reap multimillion-dollar profits from upcoming projects would be disingenuous to complain about relatively small fee increases needed to cover the city’s workload.

The rise in fees was expected to get a final City Council vote last week but hit a political snag and was sent back to its Budget Committee; Bill 70 (2013) has since been amended in committee and advanced for full Council vote.

The 40 or so fees being discussed would affect mostly large-scale developers and have little effect on individual property owners. For instance, applications for all conditional-use permits for meeting facilities, day care facilities and schools would cost $1,200 double the current $600 for a major conditional use permit plus $300 an acre up to a maximum of $15,000 (current maximum is capped at $10,000).

New processing fees would be levied: $600 for an environmental assessment, and $1,200 for an environmental impact state- ment. These can be voluminous, complex documents that involve much vetting and circulation; it’s right that a fee be assessed.

And there is no doubt that activity is on the upswing. Some major developments on the near- horizon, to name but a few:

» More than 22 high-rises in Kakaako are being proposed by major players such as Howard Hughes Corp., Kamehameha Schools, Castle & Cooke and Alexander & Baldwin.

» In Central Oahu, there is the master-planned residential community of Koa Ridge, and in Ewa, the community of Hoopili.

» In Waikiki, hotels and condotels are being planned along Kuhio Avenue, at the International Market Place site and at King’s Village.

Also looming is major potential for transit-oriented development around the rail project’s 21 stations, stretching from East Kapolei, past Aloha Stadium, through downtown, to Ala Moana.

The increases are estimated to net up to $1 million annually, but officials say the more important goal is to try to recoup a share of the costs for work done by DPP employees from those benefiting directly. Even then, the fees would pay just a portion of costs tied to the permits and services for which they are being assessed, said DPP Director George Atta.

This bill would help Honolulu, which has not increased such fees in more than a decade, catch up to what other municipalities charge for similar permits and services.

Of course, DPP would certainly help justify its own cause by providing timely processing and efficient service. Improved service doesn’t have to cost a dime, but can be invaluable to the taxpaying consumer and fee-paying client across the counter.

Oahu’s building boom is intensifying, and monied interests stand to make sizeable profits. The City Council should recognize this, and allow DPP’s reasonable increase in fees to help fund the increasing demands on government services.