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Fall Real Estate: Permission Granted?

Many businesses that work on construction projects in Central Pennsylvania criticize this state’s building-approvals process. So the Business Journal asked those companies and building-trade groups how that process compares with other states’ systems.

Many businesses that work on construction projects in Central Pennsylvania criticize this state’s building-approvals process. So the Business Journal asked those companies and building-trade groups how that process compares with other states’ systems.

The answer: poorly.

Toll Bros. Inc. builds luxury homes in 21 states, and Pennsylvania is among the more challenging states in which to secure required building approvals, said Frederick N. Cooper, the company’s senior vice president of finance and investor relations. The firm is based in Horsham, Montgomery County.

“You’re seeking approvals from volunteer township-approval boards. (Their members are) often on the boards to control the volume of development in their towns,” Cooper said.

Municipalities administer Pennsylvania’s approvals process, while counties oversee most states’ routines where Toll Bros. builds, Cooper said. Many builders see the county processes as more streamlined than the municipal ones. There typically are far fewer county processes and officials to know in each state compared with Pennsylvania.

Another challenge for Toll Bros. is finding space to build, Cooper said.

“We’re typically dealing with smaller sites. We’re often rubbing elbows with existing neighbors, versus states with fewer residents,” he said.

No data was found to compare states’ building-approvals processes. Building-industry groups, including Associated Builders and Contractors Inc. and BOMA International, don’t track the process across the U.S. Associated Builders and Contractors is the main association for the nation’s construction industry. BOMA represents more than 16,500 owners and managers of commercial real estate.

Vern McKissick, president of Harrisburg-based McKissick Associates Architects, drew an ugly picture of Pennsylvania’s process versus those of the other seven states where he has worked.

In Pennsylvania, a lot of small municipalities’ building-plan reviewers have little education and overcharge, McKissick said. The state’s 2004 adoption of its Uniform Construction Code caused those problems, he said. Before, experienced reviewers with the state Department of Labor and Industry reviewed plans for a small cost, he said. Now, independent reviewers who have taken a few college classes charge more, he said. When an independent reviewer planned to bill McKissick’s firm $58,000, the firm found someone else to do the review for $15,000.

The state’s government structure is partly why McKissick opened an office in North Carolina, where counties oversee building approvals, he said. He wants Pennsylvania to make that switch but is pessimistic.

“There’s little or no chance of change here,” he said.

Pennsylvania’s building-approvals process also is long, which adds more costs, McKissick said. The process for one construction project cost his company nine months and $500,000 in delays.

California, Delaware and Florida have shorter processes than Pennsylvania, said Dave Marschka, vice president of construction management with Blackford Development Ltd. Those are the only states where he has handled projects. He has had to talk with the most people in Pennsylvania because of its numerous municipal officials.

Marschka’s quickest process in Pennsylvania — from project idea to project approval — was five months, he said. His average there is about eight months.

Delayed municipal meetings or those that someone couldn’t attend have held up Blackford, Marschka said. The real estate developer is based in Manheim Township, Lancaster County.

“Because of Pennsylvania’s government structure, it’s no wonder we have trouble keeping businesses. It’s a hindrance. But I don’t think we’re ever going to change it,” Marschka said.

Keystone Custom Homes Inc. typically spends two to six years seeking approvals for each project, company President Jeff Rutt said. Everything from traffic issues to bog turtles have slowed the process for his West Lampeter Township, Lancaster County-based homebuilder, he said.

William Penn is responsible for the system, said Rich Heslin, a partner with NAI Commercial Partners Inc. The real estate brokerage is based in East Hempfield Township, Lancaster County.

“(Penn) believed everyone should be in control of their own destiny. He didn’t want orders from King George because of the Revolution. Everyone’s in control of their destiny today, but with bureaucracy. Everybody knows what the solution is — regionalization. I don’t see that happening …” Heslin said.

Tips to get permission to build in Pennsylvania

  • Develop strong relationships with municipal officials.
  • Before seeking building approvals from the officials, get to know them well. Refer them to successful projects you’ve completed and municipal officials with whom you’ve worked well.
  • Meet officials with municipalities where you plan to build, and watch their reactions to your plans. Those meetings can help you avoid problems that kill projects.
  • Don’t strong-arm the officials; it rarely works.
  • If they suggest changes to your plans, consider making them.
  • Don’t assume nor say that you’ll get the approvals you’re seeking.

    Source: Dave Marschka, vice president of construction management with Blackford Development Ltd.

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