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The Honolulu Advertiser
Posted on: Thursday, July 22, 2004

Permit backlog slows O'ahu home building

By Andrew Gomes
Advertiser Staff Writer

Soaring demand for O'ahu housing and a growing backlog at the city's understaffed building permit office has resulted in a construction delay of 400 to 500 new homes on the island, which could force some contractors to lay off workers as they await approval to build.

The Building Industry Association-Hawai'i, which represents contractors, said yesterday that it is taking months to get permits through the city's overworked Department of Planning and Permitting and industry observers said the shutdowns could lead to higher housing prices with fewer homes available in a tight market and higher equipment and interest expenses for developers. Consumers could also end up paying more if interest rates rise while they are waiting for new homes to become available.

Construction workers face possible layoffs just three months after the industry, struggling to keep up with demand, pulled out of an eight-week concrete strike.

"It's very frustrating when you consider we've got all this work to do and people are getting laid off," said Ron Taketa, business representative for the Hawai'i Carpenters Union. "It's just mind boggling."

Permitting Department director Eric Crispin said the agency is aggressively recruiting to fill vacant positions and to help alleviate the backlog of permits created by a housing boom that has intensified in recent months. The department, which is considered fully staffed at 299, now has only 228 workers. It is in the process of hiring 27 more.

"Our staff is working weekends and nights, doing all we can to keep up with the volume of permits," he said. "We wish we could go faster, but we have regulations we have to comply with and ensure compliance with. Our responsibility is ensuring life safety and quality of life."

Crispin said the department received an extra $555,000 for the fiscal year that began July 1 to help pay for hiring and overtime. The department has hired about six workers and is interviewing more. Within a month, the agency also anticipates deputizing private engineers to help review building plans.

"We feel for those who are waiting for permits," Crispin said, adding that sometimes developers eager to begin work submit incomplete plans, which usually require additional review.

Developers say they understand the department has had to do some catching up after budget and staff cuts, but they are critical of city leaders who made cuts to a department that facilitates city revenue growth.

"The city is crying that they're short of funds," said Karen Nakamura, chief executive officer of the Building Industry Association-Hawai'i. "The biggest source of money to the city is property taxes, so why in the biggest housing boom this state has ever seen are we not pumping out those permits as fast as we can to create (higher) property taxes?"

Nakamura said subdivisions by Schuler Homes, Centex Homes and Haseko Homes are being affected, representing communities slated for an estimated 400 to 500 homes.

A Haseko official declined to comment, and representatives of Centex and Schuler did not respond to calls seeking comment.

Roughly 20 to 30 homes would normally be built per month in each of the three subdivisions, but they cannot be started while permits are being reviewed. Nakamura said developers began applying months in advance to accommodate lengthy processing times.

Centex broke ground in February on its Ko Olina Kai project when it applied for permits to build model homes. An April permit application for utility and other infrastructure work, however, is still being reviewed, according to city records.

Larry Correa, president of the Plasterers' and Cement Masons' International Association Local 360, said union members have yet to be affected, but he is concerned.

"That will affect us in the long run," he said. "We don't know what we can do. It's with the city. We hope (permitting picks up) because we'll be right back in the hole, and we just got out of it."

Reach Andrew Gomes at agomes@honoluluadvertiser.com or 525-8065.