Hillsborough County Layoffs Seen as Result of Slowing Florida Housing Market
The ripple effect of the collapsing Florida housing market has reached the halls of local government, with Hillsborough County pondering layoffs for some employees who oversee new construction.
According to the St. Petersburg Times, local officials are looking at other options as well, such as shutting down their building services division once every two weeks, forcing employees to take an unpaid day off.
They also will ask commissioners May 2 whether to increase fees charged to home builders and other contractors to review and inspect their work.
The county pays its Building Services Division employees largely through those fees.
Through February, building permits collected this fiscal year are down 26 percent compared to the same period a year ago, despite a robust commercial real estate market.
They are expected to fall 34 percent by year’s end.
Because of the shrinking Florida mortgage demand, the pool of money that pays for those employees and other division costs is projected to end up with a nearly $7 million deficit. The hit will largely deplete reserves that help cover costs when the market fluctuates.
With the residential market declining, building officials had expected to tap their reserves this year - to the tune of $3 million - but the drop in permit requests has been more severe than they projected.
Just a few years prior, prospective buyers were waiting in lines and participating in lotteries for the right just to bid on lots in rising new neighborhoods. No more. Other once bustling bedroom areas, including Pasco County, are reporting similar slow-downs.
In response, Hillsborough’s Building Services Division has already imposed a hiring freeze. And officials have said supervisors are being told not to authorize any overtime work.
Contractors are already complaining that it takes too long to have their plans assessed, and that drives up costs, which ultimately get passed on and end up raising buyers’ Florida home mortgage payments.
“I heard about it this morning and my jaw hit the floor,” said John Hermes, a partner and project manager with the Perry Co., based in Ybor City, that is the general contractor for a new Bright House Networks office building for which he’s awaiting permits.
“I have a $15 million building to get started. Tell me how much a plans examiner makes an hour and I’ll pay it.”
Todd Scime of Scime for Permits, a company that helps people navigate the review process, called the cutbacks “a disgrace.” He learned of the possibilities this week, then dropped into a commission meeting to voice his objections.
“You haven’t done a thing about property taxes on people and residential insurance (costs), and now you’re going to crush your own citizens again by closing the building department, and you’re going to hurt your employees?” he vented.
The Tampa Bay Builders Association has been meeting with officials periodically for more than a year, seeking to speed up the review process. Jennifer Motsinger, director of governmental affairs for the industry trade group, said the county had been making progress.
But she said there is still room for improvement, and worried that cutbacks would erode progress, either through a loss of people reviewing plans, or from the poor morale of the Florida mortgage loan seekers who must pick up the slack.
SOURCE: St. Petersburg Times
