City proposal: Private firms could OK building plans

By Johnny Brannon and Gordon Y.K. Pang
Advertiser Capitol Bureau

Private architects and engineers will soon have the authority to approve building plans of developers who are willing to pay for the service, Mayor Jeremy Harris announced yesterday.

But reaction to the plan was mixed among some of O'ahu's leading developers and among those stuck in line at the city's one-stop building permitting center at the Honolulu Municipal Building.

Plans are normally reviewed by city employees before building permits are granted. The city will retain the sole authority to issue permits, but allowing "third-party review" of plans by the private sector should expedite the process and reduce a backlog of permit applications, Harris said during a press conference where he signed administrative rules allowing for the procedure.

Under the new system, a developer or homebuilder would essentially be able to hire a third-party reviewer to inspect and check-off on their plans. Architects and engineers who review plans submitted under the program must be licensed and certified by the city under the program, which Harris said should be up and running in a few days. The city would still retain its inspection authority.

Builders and homeowners seeking permits often line up before dawn to present their plans, and the city's Department of Planning and Permitting has long been understaffed, according to a recent audit.

Harris said budget cuts, coupled with a booming construction market, had put "incredible pressure" on the department. Officials had been working on a "creative privatization" solution for the past year, and it could be working within weeks, he said.

Representatives for Castle & Cooke Homes and Gentry Homes, two of the island's busiest developers, applauded the mayor for coming up with a plan that will help reduce the wait time for permits. But both said they need to review the details of the new "3PR" program before deciding whether they will hire third parties to review their own applications.

Harry Saunders, president of Castle & Cooke Homes, said several of his staffers have worked with the city about improvements to the permitting system, including the concept of third-party reviewers. "Everyone seems to kind of like the idea but, like in everything else, the devil's in the details," he said.

Saunders said it's too early to say if Castle & Cooke, which is delivering about 625 homes this year and will be adding another 500 to 550 in each of the next two years, will hire third-party reviewers. "Basically, it comes down to at what cost, will it be faster and will it really result in a faster process?"

Saunders said a key issue is liability.

"Who is going to pick up that liability?" he said. "I don't know if you're going to be able to find licensed professionals whose insurance will allow them to do it."

Renee Tajima, production manager for Gentry Homes, was also cautious about the city's announcement.

"Our general stance is that we will do whatever it takes to assist DPP to expedite the applications," said Tajima, whose company is bringing about 250 homes online on O'ahu this year, and about the same number next year.

But when asked if Gentry would be hiring third-party reviewers, she replied, "I don't know enough details about the program to determine that." She echoed the concerns raised by Saunders about liability.

City planning director Eric Crispin said liability concerns were a key reason why it took time for the rules to be finalized.

Crispin said the rules require the liability to be borne by the architect or engineer who is the third-party reviewer. "This is an alternative to standing in line at DPP, and as with any other business venture, certain businesses will find it worthwhile to incur that additional liability and will cover that cost of liability insurance in their fees," he said.

Several companies, both locally and from the Mainland, have expressed interest in taking on the third-party reviewer's role. "On the Mainland, there are currently firms that provide that service, so for them it's really nothing new."

Crispin added that he knows of several commercial and residential developers who have said they intend to hire third-party reviewers.

Reaction to the plan was also mixed at the city's one-stop permitting center, where about a dozen people had been waiting for several hours to get their building plans processed.

Sione Kava, a contractor who specializes in swimming pools and water features, said he believes any initiative to reduce the waiting time for permits is a positive sign.

"I've been waiting since this morning when they opened at 7:45," he said, glancing at a clock that was approaching 11:30.

Kava, who pulls permits for at least two projects a month, had picked up service No. 15 in line yesterday morning and was nervous that an interview with a reporter was going to make him lose his place.

Kava said he likes the idea of a third-party reviewer and may consider hiring one, for the right price. He added that a reviewer may be able to free him up to return to the job site to tend to his business.

Self-employed architect Frank Ibana said that while third-party reviews may speed up the process, he's worried about potential abuses among professionals who are too cozy with one another. "People are going to go 'I know this guy, and I can always ask him to do it' " Ibana said.

"What they need (at DPP) is more staff," said Ibana, who has been seeking building permits from the city for three decades and has seen the staffing at the permits counter decline. "I like these people here; they just need a little more help."

Crispin said similar programs are in place in other cities, and that Honolulu's version could shave up to three months off the timeline for some projects.

"We believe it's a substantial improvement over the process we have now," Crispin said. "We believe it will apply mostly to the large substantial projects, but it's open to all applicants."

The system will allow the department to issue some permits the same day they are applied for, Crispin said. The city will not charge fees for third-party review, but the private plan reviewers can, he said.

"There's absolutely zero cost to the city," Crispin said. "The cost of third-party review will be borne by the developer, much in the same way that the developer currently pays for the design services of the original architect. ... This is a way around the tight financial constraints and fiscal sustainability policy that we have."

He said no city jobs would be eliminated by the change.

"What this does is allow the private sector to take on the overflow beyond that which we are currently able to accommodate," he said.

The initiative will apply only to building permits, not discretionary, conditional or zoning-type permits, Crispin said.

An audit released in June found that the city failed to prepare for and properly support earlier changes to the way permits are issued.

Workers were not properly trained to process permits using an automated tracking system, and were overwhelmed by data input requirements, according to the report by City Auditor Leslie Tanaka.

The city has seen high staff turnover at permit centers that leaves them shorthanded, with a heavy workload and poor morale hampering those who remain, Tanaka found.

Mayoral candidate Duke Bainum said he applauds Harris' efforts to speed up the permit process. The concept of granting more authority to the private sector sounds good, but the city must ensure that only qualified people review and approve plans, Bainum said.

And the city must make sure that city services are not reduced for nonprofit groups and homeowners seeking permits for minor work, Bainum said.

Mayoral candidate Mufi Hannemann also applauded Harris' announcement, but said the change comes too late and won't address the vacant jobs in the planning department.

"It's a good idea, but it's long overdue," Hannemann said. "It should have been done months ago, and we still need to fill those positions."

Reach Johnny Brannon at jbrannon@honoluluadvertiser.com or reach Gordon Y.K. Pang at gpang@honoluluadvertiser.com. Reach either at 525-8070.