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Home My WebLink AboutCD Residential Building Resale SPSSSPECIAL STUDY SESSION SAN RAFAEL CITY COUNCIL MONDAY, AUGUST 1, 2016 AT 5:00 PM COUNCIL CHAMBERS, CITY HALL 1400 Fifth Avenue San Rafael, California AGENDA Members of the public may speak on Agenda item. 1. Discussion re: Residential Building Resale Inspection Program (CD) 1 Lei 0]0111/ 1010 1 9 American Sign Language interpreters and assistive listening devices may be requested by calling (415) 485-3198 (TDD) or (415) 485-3064 (voice) at least 72 hours in advance. Copies of documents are available in accessible formats upon request. Public transportation is available through Golden Gate Transit, Line 22 or 23. Paratransit is available by calling Whistlestop Wheels at (415) 454-0964. To allow individuals with environmental illness or multiple chemical sensitivity to attend the meeting/hearing, individuals are requested to refrain from wearing scented products. RESIDENTIAL BUILDING RESALE REPORT (RBR) PROGRAM y BACKGROUND ❑ 1973- City established RBR Program ❑ Similar resale programs administered by all Marin jurisdictions except County ❑ 600-700 resale reports prepared/issued annually ❑ 2013-2014 City worked with MAR to develop "San Rafael RBR Program Policies & Practices" STATE PERFORMANCE AUDIT ❑ State Performance Audit commissioned in 2015 LJ Audit report completed in March ❑ Performance Audit recommends procedural improvements to program; most being implemented ❑ April 4 = City Council review of Audit report; directed staff to study program options including continuation or elimination 1. Eliminate Free -up staff time; No access to inventory; Fee eliminated. County of Marin Program 90% of CA = no resale no enforcement of Reduction in cost program unpermitted work recovery from pursuing unpermitted work 2. Continue Current Program 3. Voluntary Program Continued access to inventory to capture unpermitted work Same as #2 4. Permit Record Limited staff required to Only administer; shorter process for customer 5. Continue Current Program but Limit Enforcement Continued access to inventory. Enforcement and correction of major violations Fee increase per State Audit; increase in cost to customer Extent/number of requests unknown Questionable value as records available on-line No access to inventory No capture of unpermitted work Unpermitted work would continue to be in violation; could discourage owner from securing permits for future work major violations = difficult to define ? Fee increase to $270 for SFD report Continued cost recovery for permits Same as #2 except amount of cost recovery unknown Reduce fee to $130 for SFD report. No capture of cost recovery for unpermitted work Fee increase to $270 for SFD report; N ovato Belvedere Mill Valley Ross Tiburon Corte Madera Sausalito Larkspur Fairfax San Anselmo STAKEHOLDERS ❑ Marin Association of Realtors = support for Option 4 (some supporting Option 1) LJ Marin County Tax Assessor = support for Option 2 ❑ Marin Builder's Association = support for ❑ Fire Department + Emergency Responders ❑ Local Architects/Designers ❑ Citizens who lawfully obtain permits ❑ Other Marin jurisdictions Option 2 ❑ Contractors State License Board & State DOJ DATA & STATISTICS ❑ San Rafael performed just under 700 RBRs per year over last 4 years. ❑ Roughly half of those have clean reports with no violations. ❑ More than 50% of inspections identify some level of unpermitted work. ❑ Over half of those are "major' in nature (require plans/zoning review/abatement) BENEFITS OF PROGRAM LJ Health and Safety..... Health and Safety LJ Consumer benefit to the Buyers (seller pays) Ll Limited nature of the report does not duplicate other typical inspections Ll Relatively high incidence of violations identified LJ Effective program is a strong disincentive to performing unpermitted work Ll Neighborhood preservation in lieu of more proactive Code Enforcement practices BENEFITS OF PROGRAM ❑ Through coordination with the Assessor's office, keeps housing inventories accurate, and tax assessment on a "level playing field" ❑ By requiring retroactive permits for illegal work, helps to maintain fairness/parity with contractors/citizens who do lawfully obtain permits ❑ Provides for cost recovery of permit fees which would otherwise be lost, keeping permit fees relatively low for all. FISCAL IMPLICATIONS ❑ Current program brings in approximately $117,000 annually in fees (cost recovery) ❑ Part time RBR inspector costs approximately $35,000 annually ❑ Recovered permit/inspection fees for unpermitted work are approximately annually (including penalty fees). $3251000 FACTORS TO CONSIDER LJ State auditor implicitly supported the program in all three cities selected for the study; report recommends program improvements. LJ Current program provides a strong disincentive to performillegal work -- benefits the construction and design businesses. LJ High incidence of unpermitted work— potential for health and safety risks to that property and neighboring properties. LJ Helps to identify many illepl units, and oen legalize them. Other beneft its for neighborhood preservation. FACTORS TQ CONSIDER LJ Consumer protection by ensuring that all residential im :)rovements are ultimately inspected anc. safe for the new home purchaser LJ Difficult to justify suspending the grogram based the very high incidence of i legal activity being identified. LJ Whatever San Rafael does could impact other jurisdictions in the county. LJ Others in the community are supportive of the LJ Recovery of permit fees for unpermitted work helps to keep permit fees lower for all. NS .r; - .. �- r '- ., }---.- •T � � �,�_w_ _ter "� . _ OPTION 2 - FEE STUDY Permit Tech. Process/open application TIME 0.25 $90 $22.50 Admin Asst. Permit history; base report 0.65 $87 $56.55 prep; coordinate with applicant; schedule inspections RBR Inspector Perform field inspection; enter 1.25 $115 $143.75 results into report Admin Asst. Proof and finalize report; post 0.3 $87 $26.10 report; contact customer Management Meet with customer when 0.06521 $160 10.43 staff issues are in dispute Overhead (vehicle gas, supplies, $11.00 etc.). TOTAL: $270.33 OPTIONS OPTION 1 Eliminate residential resale inspection program OPTION 2 Continue current program and practices (status quo) with measures recommended by State Auditor OPTION 3 Continue current program - same as Option 2, except make the program voluntary OPTION 4 Report on Permit Record only (no inspections) OPTION 5 Continue current program but limit enforcement to correcting significant life & safety violations only. Other violations are "flagged' and required to be corrected when future permits are requested by owner. Offer a reduction or waiver of fees immediate correction of violations. OPTIONS TO RESIDENTIAL RESALE INPSECTION AND REPORT PROGRAM July 25, 2016 ADVANTAGES Free -up staff resources. Consistent with 90% of local jurisdictions in California. Continued access to housing inventory to capture unpermitted work; health/safety; Same as Option 2. Except, provides seller and buyer the option to request report. Limited staff required to administer; shorter process for customer Continued access to housing inventory to flag violations. Enforcement and correction of major health & safety violations. DISADVANTAGE No access to housing stock; no enforcement of prevalent violations; subsequent health/safety risks. Per recommendation of State Performance Audit, increase cost to customer to cover cost of City staff resources. Same as Option 2. As a voluntary program, the extent of RBR requests is unknown, making it difficult to estimate staffing needs. No access to housing inventory and no enforcement of violations. Questionable value as permit history available on- line. Unpermitted work would continue to be in violation; property owner would control timing of corrections. Could discourage owner from securing permits for future work, thus promoting continued, unpermitted improvements. FEE (COST TO ADMINISTER PROGRAM) FISCAL IMPACT Fee eliminated. Reduction in cost recovery due to lack of capture of unpermitted work. Staffing or level of service implications. Current fee = $165 for SFD, would have to be increased to $270. Continued cost recovery for enforcement, permitting & inspection of unpermitted work & other building division services. Life/safety benefit. Same as Option 2, except departmental cost recovery for permitting and inspection of unpermitted work would likely be less (unknown at this time). Reduce current fee of $165 for SFD report to $130. Reduction in departmental cost recovery for capturing unpermitted work Current fee = $165 for SFD would have to be increased to $270 (for cost recovery) Continued capture of unpermitted work but limited to correcting major health & safety violations. Defining "major" may be problematic. Fiscal impact on revenue unknown. PROGRAM EMPLOYED BY OTHER MARIN AGENCIES (FEE FOR SFD REPORT) County of Marin ($0) Novato ($274) Belvedere ($300) Mill Valley ($310) Ross ($375-$975) Tiburon ($250) NA Corte Madera ($130.00) Sausalito ($113) Larkspur ($175) Fairfax ($350) San Anselmo ($220) GENERAL COMMENTS MAR does not support this option. MAR does not support this option. County Assessor supports continuation of current program to track/update property data/assessments. Marin Builder's Association supports retaining program. MAR supports this option Emails as of 11:45 a.m. on 8/1/16. reeardine the Residential Resale Inspection Proeram Name: Benjamin Faber Submitted: 2016-07-27 22:05:58 UTC Message: Option #4 Name: Carolyn Svenson Submitted: 2016-07-27 22:09:33 UTC Message: PLEASE eliminate your draconian resale inspections as they are currently conducted. The method that Corte Madera(and other cities across the Bay Area)uses is your Choice #4: provide a record of permits and charge the seller some substantial fee. No one objects to the fees; they object to the huge hurdles that the City of San Rafael has created. Name: Tom Benoit Submitted: 2016-07-27 22:12:58 UTC Message: I am favoring keeping the program the way it is. I think it helps the buyer to get a home with fewer problems, that might surface later. Probably prevents some lawsuits too. Name: Brent Thomson Submitted: 2016-07-27 22:14:23 UTC Message: I feel strongly the resale inspection process should be limited to a desk review only of permits on record. Name: Allison Salzer Submitted: 2016-07-27 22:16:19 UTC Message: I'd vote for reporting on permit record Name: Julie Leltzell Submitted: 2016-07-27 22:28:44 UTC Message: My experience and the stories are showing that the process in San Rafael is needlessly confusing, punitive and expensive for both buyers and sellers in your town. Please adopt a resale policy that informs buyers of permits that were not taken out, or not finaled so buyers are aware and they can choose to take action, or demand compliance by sellers, or choose to take the property'as is'. It makes much more sense, and it would relieve us all of burdensome and expensive regulation and oversight of minutiae Having to retroactively permit items that were legal at the time is too much. Name: Rocky Vannucci Submitted: 2016-07-27 22:35:15 UTC Message: Encouraging council to change resale process to Report on Permit Record only (no inspection) Name: Gary Newman Submitted: 2016-07-27 22:58:32 UTC Message: I am in favor of Option #4 in the list of five options only he table. Reports on Permit Records Only. Name: Jim King Submitted: 2016-07-27 23:16:12 UTC Message: Hi, I can't make the study session for the resale inspection process, but want to with in with my preference of reporting on the permit record only. The current process is very onerous on sellers, buyers and real estate professionals. Name: Lee Riney Submitted: 2016-07-27 23:24:18 UTC Message: I have worked as a realtor in Marin for over 30 years. Resale inspections are an asset. Permits that are never finaled are important to know about, as are add ons without permits. Health and safety issues are also important. I've seen many inspectors arrive, check the straps on the water heater, and leave. I recently had an inspection done in another Marin city and there were two long exterior stairways with no handrails. No mention of that in their report -just the usual add another strap to the water heater. I think inspectors should be much more thorough than they are. Name: Eric Burris Submitted: 2016-07-28 00:14:15 UTC Message: I hope this email makes it through. I am the attorney for Bradley Real Estate. I request that the city of San Rafael implement a resale process like that of San Francisco, namely just a Report of Residential Building Record (aka a 3R report). I believe it is also being referred to as a "Report on Permit Record Only." Thus, no physical inspections by the building inspector. The procedure in San Francisco works very smoothly and effectively. Thank you. Name: Scott Pinsky Submitted: 2016-07-28 01:55:28 UTC Message: I encourage the Council to modify the program by implementing the 4th option that will be presented at the upcoming hearing on this issue, i.e. a Report on Permit Records for any home subject to the resale inspection ordinance. Buyers are entitled to the City's current information on permit status, an issue that private inspectors rarely address. By contrast, since most buyers (and many sellers) hire their own inspectors before or during escrow, a physical inspection by the City is largely duplicative and redundant, incurring needless cost to both the City and the parties. Any significant issues noted during these private inspections are typically addressed by the parties prior to close. Name: Jeannie Rorvik Submitted: 2016-07-28 13:54:30 UTC Message: Please consider option #4 as it makes sense and simplifies a complicated system Name: Wes Mayne Submitted: 2016-07-28 16:24:32 UTC Message: If a qualified inspector can come out for option 5 and can thoroughly identify health and safety problems, then I think option 5 would be a good one. Other wise option 4 seems to make the most sense. Name: Cam Ashurst Submitted: 2016-07-2818:55:30 UTC Message: vote for no resale inspections til Name: Jennifer Boesel Submitted: 2016-07-28 21:36:21 UTC Message: Option 4, report on permit records only, no inspection Name: Charlotte Boesel Submitted: 2016-07-28 21:53:36 UTC Message: Hello, I am a new Realtor in Marin County and I would like to vote for option it4: Report on permit record only (no inspections). Thank you, Name: Andy Falk Submitted: 2016-07-29 22:38:46 UTC Message: Please switch to a report of existing permits only like Corte Madera and Sausalito from the current onsite inspection ASAP. Name: Catherine Cook MacRae Submitted: 2016-07-3120:41:46 UTC Message: I vote for a desk review only of permits on record for buyers purchasing property within the City of San Rafael. Name: Justine Fairey Submitted: 2016-08-0103:42:32 UTC Message: I recommend option #4 Name: Fred Angell Submitted: 2016-08-0113:37:42 UTC Message: I favor option # 4 - Report on permit record only in lieu of full resale inspections Emails as of 11:45 a.m. on 8/1/16, regarding the Residential Resale Inspection Program Name: Benjamin Faber Submitted: 2016-07-27 22:05:58 UTC Message: Option #4 Name: Carolyn Svenson Submitted: 2016-07-27 22:09:33 UTC Message: PLEASE eliminate your draconian resale inspections as they are currently conducted. The method that Corte Madera(and other cities across the Bay Area)uses is your Choice #4: provide a record of permits and charge the seller some substantial fee. No one objects to the fees; they object to the huge hurdles that the City of San Rafael has created. Name: Tom Benoit Submitted: 2016-07-27 22:12:58 UTC Message: I am favoring keeping the program the way it is. I think it helps the buyer to get a home with fewer problems, that might surface later. Probably prevents some lawsuits too. Name: Brent Thomson Submitted: 2016-07-27 22:14:23 UTC Message: I feel strongly the resale inspection process should be limited to a desk review only of permits on record. Name: Allison Salzer Submitted: 2016-07-27 22:16:19 UTC Message: I'd vote for reporting on permit record Name: Lee Riney Submitted: 2016-07-27 23:24:18 UTC Message: I have worked as a realtor in Marin for over 30 years. Resale inspections are an asset. Permits that are never finaled are important to know about, as are add ons without permits. Health and safety issues are also important. I've seen many inspectors arrive, check the straps on the water heater, and leave. I recently had an inspection done in another Marin city and there were two long exterior stairways with no handrails. No mention of that in their report - just the usual add another strap to the water heater. I think inspectors should be much more thorough than they are. Name: Eric Burris Submitted: 2016-07-28 00:14:15 UTC Message: I hope this email makes it through. I am the attorney for Bradley Real Estate. I request that the city of San Rafael implement a resale process like that of San Francisco, namely just a Report of Residential Building Record (aka a 311 report). I believe it is also being referred to as a "Report on Permit Record Only." Thus, no physical inspections by the building inspector. The procedure in San Francisco works very smoothly and effectively. Thank you. Name: Scott Pinsky Submitted: 2016-07-28 01:55:28 UTC Message: I encourage the Council to modify the program by implementing the 4th option that will be presented at the upcoming hearing on this issue, i.e. a Report on Permit Records for any home subject to the resale inspection ordinance. Buyers are entitled to the City's current information on permit status, an issue that private inspectors rarely address. By contrast, since most buyers (and many sellers) hire their own inspectors before or during escrow, a physical inspection by the City is largely duplicative and redundant, incurring needless cost to both the City and the parties. Any significant issues noted during these private inspections are typically addressed by the parties prior to close. Name: Jeannie Rorvik Submitted: 2016-07-28 13:54:30 UTC Message: Please consider option #4 as it makes sense and simplifies a complicated system Name: Catherine Cook MacRae Submitted: 2016-07-3120:41:46 UTC Message: I vote for a desk review only of permits on record for buyers purchasing property within the City of San Rafael. Name: Justine Fairey Submitted: 2016-08-0103:42:32 UTC Message: I recommend option #4 Name: Fred Angeli Submitted: 2016-08-0113:37:42 UTC Message: I favor option # 4 - Report on permit record only in lieu of full resale inspections Name: Gene Laico Submitted: 2016-08-0121:16:35 UTC Message: Dear City Council, I am a Realtor who works extensively in Marin County. I have reviewed the five options you are considering for the Resale Inspection Program and have the following comments. I note that "Health and Safety" concerns are often mentioned as a reason for a resale program that includes a physical inspection of the home. However, there are no such programs in all of Sonoma County, nor its incorporated cities, nor in Marin unincorporated area, nor in several Marin Cities, nor in San Francisco. No one has provided any evidence that the homes in these other areas are less safe or more healthy than the homes in San Rafael. The City inspections are brief, 15 to 30 minutes in my experience. Only a few limited items are looked at. Systems are not operated, electrical and plumbing not tested, etc. On the other hand, virtually all homes sold undergo a professional inspection by a home inspector, typically 2.5 to 3 hours. Systems and appliances are operated, electrical and plumbing tested, pipes and circuits under the house inspected, the roof is inspected, and much more. It is unreasonable to expect that homes subject to a brief city inspection will be safer than those undergoing extensive professional inspections.