AUDITOR General for the City of Vancouver, Mike Macdonell, on Wednesday released a performance audit report on the topic of building permit fees that pointed out several shortcomings.

Building permit fees are charged to recover expenses incurred in processing permit applications. The audit determined that the City developed and implemented straightforward processes to consistently and accurately assess building permit fees for new buildings.

The audit also found that, for projects that were reviewed, the value of the proposed work used as a basis to calculate fees was reasonable. Fees were charged accurately, in accordance with the City’s Schedule of Fees.

However, in some cases processes were applied inconsistently, resulting in under-collected permit revenue. Additionally, the method used to determine housing construction estimates as the basis for calculating fees was not authorized by the Vancouver Building By-law. The audit also identified deficiencies in the administration of building permit fees:

• The City lacked written procedures and guidance for staff on the building permit fee assessment process; and,
• The City did not provide detailed guidance to applicants to ensure that project cost estimates submitted in building permit applications were complete, reasonable, and supportable.

“I express my appreciation to the Development, Buildings and Licensing Department team for their assistance and full cooperation during the audit,” Macdonell said.

The report contains five recommendations to improve the administration of building permit fees. The City’s Development, Building and Licencing Department has accepted all of the recommendations and provided an action plan for their implementation.

IN response, the City’s General Manager of Development, Building and Licensing, Andrea Law, released the following statement:

“I thank the Auditor General for his report and recommendations related to Building Permit Fees and accept the five recommendations put forward regarding changes and modifications to the administration of the program.

“City leadership appreciated participating in this independent assessment of the current cost valuation process and procedures for determining Building Permit fees for new construction.

“The audit offered an opportunity to gain insights into departmental administration of the cost valuation program and to identify inconsistencies and opportunities for improvement.

“City leadership also acknowledges the complexities of the current cost valuation tool recognized in the Vancouver Building By-law which may have contributed to some of the inconsistencies identified, and will be exploring other acceptable industry tools that may offer a simplified cost valuation methodology.

“I look forward to working with the Auditor General to implement the City’s response and next steps as outlined.”