Developers and companies in the construction industry might be unpleasantly surprised the next time they seek a zoning change or construction permit in Indianapolis.
On Jan. 1, a new fee schedule kicked in for many of the functions of the city's Department of Metropolitan Development, raising the cost of seeking zoning changes, variances and construction permits.
In some cases the jump in fees is dramatic, while other fees will change little or not at all. However, the overall effect on DMD's bottom line tells the story: the department expects revenue from fees to nearly triple in 2006, from about $460,000 in 2005 to an expected $1.27 million this year, said DMD spokesman Justin Ohlemiller.
The increases were necessary because fee revenue hasn't kept pace with the city's costs to review petitions, Ohlemiller said. Those costs mostly include staff time and advertising costs for public notice of petitions, which is required by law.
"Planning fees as charged [last year] only covered about 30 percent of the costs," said Ohlemiller. The remainder came from DMD's reserve funds, which were quickly being depleted, he said.
Most filing fees hadn't changed since 1990. In the future, Ohlemiller said, the department may review the fee schedule more frequently to make minor adjustments rather than springing large increases less often.
Many fees will double or even triple, affecting everyone from homeowners and small-business owners to large commercial and residential developers. For instance, the cost to seek approval for a window sign in the downtown area, called the regional center in DMD parlance, will jump from $15 to $40. Applying for a permit for residential additions, such as a sunroom or detached garage, will rise from $35 to $55.
The filing fee increases will make new buildings more expensive for buyers and tenants, said Roger Stephens, director of governmental affairs for the Builders Association of Greater Indianapolis, which covers Marion and the surrounding seven counties.
However, the new fees generally don't exceed those charged in other counties and municipalities, said Stephens.
"Indianapolis has been a little bit behind everyone else" in terms of filing fees, he said.
BAGI didn't oppose the fees before they were approved by the Metropolitan Development Commission in early December.
In revising the fee schedule, DMD staff consulted fees charged by other cities in central Indiana and by similarly sized cities across the country, Ohlemiller said.
"Our fees were very low" compared with other cities, he said. For comparable services, the new filing fees are still about 69 percent less than what is charged in Columbus, Ohio, and about 5 percent less than in Austin, Texas, Ohlemiller said.
DMD also asked BAGI and other groups, including the Marion County Alliance of Neighborhood Associations, the Metropolitan Indianapolis Board of Realtors and the land-use section of the Indianapolis Bar Association, for their input before the new fee schedule was approved. None of the groups expressed strong opposition to the increases, and no one spoke out against them at a public hearing before the increases were approved, Ohlemiller said.