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Time Permitting: Developers Say Long Waits for Dallas Permits Hitting Bottom Lines

If they don't want to put up with long delays for permits, Dallas developers often have to call their council members to speed up the process.
If they don't want to put up with long delays for permits, Dallas developers often have to call their council members to speed up the process.
Patrick Michels
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Time is money. Developers and business owners know this to be true, especially in Dallas where it takes weeks, sometimes months to get required permits for their projects, making building in the city more expensive.

After the pandemic broke out, Jimmy Tran, principal owner of the investment firm Oaklawn Group LLC, signed a development agreement to bring multiple Code Ninjas locations to Dallas. Code Ninjas is a Houston-based franchise that teaches kids how to write computer code.

He says he experienced first-hand the pain of obtaining permits from Dallas as he worked for five to six months to secure his first Code Ninjas location.

“At one point, I didn’t know if there was light at the end of the tunnel,” Tran said. “We were just in these recurring, never-ending loopholes.” He said his plans would often be denied without a clear reason or a clear point of contact at the Dallas Oak Cliff Municipal Center, the city's permitting office.

When he is able to talk to someone, he often gets contradictory information from different people. “One guy told us we had to redo our entire plan set after another guy had told us we only needed to make two tweaks,” he said.

Sometimes this works to their advantage. It would have cost between $3,000-$5,000 to redo the plans, he said. So, instead, he had the plans reviewed by someone else at the permitting office who said there were only a few small changes that needed to be made to meet all the required criteria.

City Council members get daily reminders from developers and businesses of just how bad the process has become. They often hear about how it’s driving businesses away, as neighboring cities are not facing such delays.

At its highest point in September, there was a backlog of 981 permits stuck in the city's prescreening process.

It wasn’t always this bad. People used to apply for and inquire about permits at the city's permitting office in person, primarily because they could never get someone on the phone, said Justin Clark, property manager at Mote and Associates Inc.

“The city of Dallas was the only city that you could not call and get an answer for really anything unless you had someone’s ear in the department,” Clark said.

Nevertheless, people could leave the office with their permits or at least some idea of what else needed to be done to obtain them.

Last year, Dallas rolled out ProjectDox, an online portal for prescreening permits. About 20% of planning permits were being processed electronically through the portal before the pandemic. This skyrocketed to 90% as operations were forced to be conducted remotely. It was a load that the system was not quite ready to carry, as ProjectDox was not fully integrated yet.

This led to the significant backlogs, about half of which were for single-family developments.

“Before the pandemic, the single family home permitting process was an advantage that Dallas had over a lot of other cities,” said Phil Crone, executive director of Dallas Builders Association. The process, which took a few weeks in other cities, only took about a day in Dallas. Now, it can take up to 12 weeks, he said.

The delays in the process can have a significant financial impact on builders. “As a small builder, you’ll get a construction loan out with the bank and you’ll have to pay interest on that loan whether something’s getting built or not,” he said. “These are small mom and pop businesses that may only employ two, three or four people, and that’s crippling.”

He said it also affects the city’s affordable housing goals. “These delays make building more expensive, and you can’t have housing be more affordable when building is more expensive,” Crone said.

Kris Sweckard, director of the city's Sustainable Development and Construction Department, told the council’s economic development committee last week that additional resources were assigned to the prescreening process in response to the mounting backlogs.

However, he attributed some of the delays to user error with ProjectDox, saying that despite explicit instructions, permits were being submitted incomplete or with mistakes.

Council member Jennifer Gates said the fact that incomplete permits can even be submitted is a red flag. Gary Heath, CEO of Avolve Software, which developed ProjectDox, said they are reaching out to the city to improve the process but that the software won't be able to determine if a permit is complete because it cannot interpret site plans like a person can.

"The prescreen review itself is done by a person no matter [what]," Heath said.

Crone said the way the city implemented ProjectDox is causing many of the problems. “Builders and everybody just didn’t forget when the pandemic showed up how to apply for a building permit,” he said.

Cities have different criteria for permits that are intended to streamline the process, like required labels or orientations of documents, Heath said. “Our software factually doesn't care if a file is rotated, or what files are named, etc.,” Heath said. “Each jurisdiction sets a submission policy to what they feel will enable the best efficiency overall in a faster permit issuance.”

Some of these requirements intended to speed up the process, however, are causing more problems than they're solving, but many of them have to do with a lack of communication.

Nathan Forti, CEO of Blue Bonnet Construction LLC, said he’s had clients who won’t build in Dallas or lease commercial space in the city because they know how tedious and how expensive the permitting process can be. What has made it easier in other cities, Forti said, is being given a point of contact with the permitting office shortly after submitting applications.

Crone tells many homeowners and builders to contact their council members when facing such delays. This will usually expedite the process. “It is indicative of when the attention is paid to a particular project how fast is does move,” he said. “And that tells me that the city can do a lot more than what it’s promising it can do for everybody that’s waiting on them right now.”

There have been some improvements. Before, when something was wrong with an application in the prescreening process, it would be sent back to be corrected through the online portal. Once these errors were corrected, the applicant would be put back into the review process, but they’d be at the end of the line. Now, if it is an easy fix, he said, they are calling the applicant and trying to resolve the issue over the phone.

Sweckard said his department is working with the city's IT department to improve the online system. By the second quarter of 2021, Sweckard said, he wants the entire permitting process to take no longer than two or three weeks, a timeframe developers have told him they can work with.

In his 2020 State of the City address, Dallas Mayor Eric Johnson said: "To spur the type of development we want to see across Dallas, we must demand that our city’s management provide a better, more efficient permitting process for businesses. Dallas is a great city for businesses, but to grow as we know it can, it must also be a great city to do business with."

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