January 20, 2009

DPD expects slow year for permits

Seattle's Department of Planning and Development saw its revenues and permit intake value fall from 2007 to 2008, and Director Diane Sugimura said she is expecting this year to be even slower.

“The revenues and intake was probably as high as it was (in 2008) because we were seeing the second and third phases of projects that had been in for some time,” Sugimura said. “What we are not seeing is new projects.”

Sugimura said the department saw $23.5 million in revenues in 2008, compared with $31 million the year before. But she said the 2008 total is still higher than 2005's $21.3 million, a more typical number. “We thought 2005 was a pretty strong year at the time,” she said.

The permit value also went down in 2008. The department's 2007 intake value was $3.1 billion, compared with $2.25 billion last year. Sugimura said she expects the number to keep falling this year because of the drop-off in large projects.

“2008 was clearly a drop but not, you know, off the cliff,” Sugimura said. “2009... we are concerned about that.”

Master use permits were also down in December, Sugimura said. She said in September, the last month that she checked for project type break-down, the department was still getting a fair amount of mixed-use and multifamily projects, many on Capitol Hill. She said there were also permits for institutional and industrial projects in September.

DPD is developing a method to extend building permits beyond their original expiration dates to help builders and others whose projects have stalled in the current market. She said she expects to release that proposal in about a month.

The department has not laid off any employees and Sugimura said DPD is “keeping our fingers crossed” to not have lay offs this year. She said the department had several vacant postions it was unable to fill during boom times, and those pre-existing vacancies are helping the bottom line now.

If all the positions had been filled, Sugimura said, the department would now be overstaffed.

The department is not filling positions as they open and they are not using mandatory overtime. They are also cutting back on consultants and watching revenues closely.

She said the department will still be busy this year with planning projects like waterfront design plans, neighborhood plan updates in station areas, and the South Downtown and Northgate rezones. She said they will also be putting a higher priority on projects that use green building methods.

“We're open for business,” Sugimura said. “It is a challenging time not just for this industry but for so many industries.”