HomeMy WebLinkAboutCD Residential Building Resale (RBR) Report____________________________________________________________________________________
FOR CITY CLERK ONLY
Council Meeting: January 18, 2022
Disposition: Resolution 15018
Agenda Item No: 5.e
Meeting Date: January 18, 2022
SAN RAFAEL CITY COUNCIL AGENDA REPORT
Department: COMMUNITY DEVELOPMENT
Prepared by: Alicia Giudice, Director
Don Jeppson, Chief Building Official
City Manager Approval: ______________
TOPIC: RESIDENTIAL BUILDING RESALE (RBR) REPORT
SUBJECT: RESOLUTION ADOPTING AN EXTENSION OF TEMPORARY MEASURES FOR
ADMINISTERING THE RESIDENTIAL BUILDING RECORD PROGRAM (“RBR
PROGRAM”) SET FORTH IN SAN RAFAEL MUNICIPAL CODE TITLE 12 (BUILDING
REGULATIONS), CHAPTER 12.36 (REPORT OF RESIDENTIAL BUILDING RECORD)
DURING THE HIGH DEMAND REAL ESTATE MARKET AND COVID-19 PANDEMIC
RECOMMENDATION:
Adopt resolution to extend temporary measures for administering the RBR Program.
BACKGROUND:
The City’s Residential Building Inspection Program (RBR), established in 1973 by Ordinance No. 1128,
requires property owners to obtain a “report of residential building record” (resale report) prior to the sale
or exchange of any residential building. The program includes a City inspection for which the findings are
incorporated in the resale report. This program was updated in December 2016 by Ordinance No. 1945
and City Council Resolution No. 14243 which set forth the adopted policies, practices, and procedures
for administering and enforcing the RBR Program; and b) Resolution No. 14244, which updated the RBR
Program fee schedule.
In November 2020, the City Council adopted Resolution No. 14870 which temporarily adjusted RBR fees
and temporarily ceased the City’s inspection portion of the RBR Program for six months. The resolution
allowed for a temporary modification to the RBR program due to the COVID-19 pandemic, an influx of
building permit inspection requests and the reduction of staff due to retirements. In May 2021, the City
Council adopted Resolution No. 14912 which extended these temporary measures to the end of
December 2021. That extension has expired and the City continues to experience a steady volume of
building inspection requests. We are close to but not at full inspector staffing, and new COVID-19 cases
are once again surging, which has an impact on in-person inspections and also the ability to fill an
inspector vacancy. For these reasons, staff is recommending an additional extension of the temporary
measures through July 2022.
SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 2
ANALYSIS:
The following tables provide Building-Related Permit activity for the past two years and RBR statistics for
the past four years:
Building-Related Permits Year 2021
Year 2020
(comparison)
New Building Permit Applications Received
(Total Valuation)
3,273
($156 million)
3,025
($116 million)
Building Permits Issued
(Fees Collected)
3,417
($4.4 million)
2,940
($7.2 million)
Projects and Permits Completed through Final Inspection 984 781
Residential Building Resale Inspection Reports Issued 737 638
Reporting Year Total RBRs
Issued
Total Monthly
Average
Total Refunds
Issued
2017 634 50 15
2018 635 49 23
2019 592 45 19
2020 638 53 38
2021 737 61 None
2022 (to date) 19 N/A None
High Demand Real Estate Market & COVID 19 Pandemic
As recently reported in Bay Area news, San Francisco and the South Bay are experiencing an exodus of
City residents that are moving outward to the suburbs. A combination of factors is causing this exodus
including: 1) a permanent and sustained shift in the workforce to working from home which started during
the COVID-19 Shelter-in-Place Order; 2) high rents in San Francisco; and 3) low interest rates for real
estate loans. Local realtors have reported record numbers of new clients seeking housing in Marin.
Further, the available real estate inventory is low, so property that is placed on the market sells quickly,
resulting in shorter transaction periods.
RBR applications remain at high levels and in 2021 showed an increase of over 15% from the prior year.
One Building Inspector has been dedicated to administering the inspections and resale reports. Other
staff in the Building Division have had to step in to assist during periods of heavy application/inspection
activity. Because of reduced staffing resulting from the COVID-19 pandemic and increased demand for
building permits, the Building Division experienced delays in processing, inspecting, and issuing the
resale reports before the temporary measures were adopted. As the sellers, buyers and realtors rely on
the information from the RBR in the property sale process, these issuance delays of the resale reports
cause significant challenges for our customers.
Temporary RBR Program Measures
Staff has continued close collaboration with the Marin Association of Realtors to meet the current high
demand for real estate and there is an interest in continuing the temporary measures which include the
following:
1. Continue to temporarily cease the City inspection part of the process.
2. Prepare and issue a resale report that provides property information and the permit history on
file with the City.
3. Continue temporarily reduced RBR fees. The recommended fee reduction is discussed in the
Fiscal Impact section of this report.
4. Apply these interim measures through July 31, 2022.
SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 3
Staff finds that the extension of temporary measures will assist in reducing turnaround time for issuance
of a resale report and allow the City’s RBR inspector to be deployed to separate, needed inspection
services. Further, the issuance of an RBR report that only provides the property permit history would be
modeled after similar resale programs in Marin where no inspection is completed (e.g., Town of Corte
Madera).
An additional advantage of the extended temporary measures is the safety provided to the customer and
the Building Inspector. With the current high demand real estate market where the available inventory is
selling quickly, a great number of sellers are remaining in their homes during the property listing and sale
process. As a result, there is a greater number of person-to-person encounters during the RBR inspection
process, which the temporary measures would curtail as a safety measure to combat the spread of
COVID-19.
There are two downsides to these interim measures. First, without a City inspection, unpermitted work
would not be identified and cited for correction. Second, if unpermitted work is not cited, there would be
a temporary reduction in projected revenue (discussed below in Fiscal Impact section) that is generated
from the issuance of retroactive permits with fines/penalties.
FISCAL IMPACT:
The administration of the RBR Program is funded by fees. As noted above, on December 5, 2016 the
City Council adopted an update of the RBR Program fee schedule. The adopted RBR fees are presented
in the table below. The fees are based on a 2016 cost study that was prepared by staff, which represents
staff time to complete the service, including a minor amount of overhead. Completing the field inspection
and reporting the inspection findings represents approximately 50% of the service time and cost
represented in the adopted fees. Therefore, staff is recommending that during this interim period, the
RBR fees be temporarily reduced as presented in the table below (right column).
RBR Service Currently Adopted
Report Fees
Temporary Fee Reduction
(Recommended)
Resale Report- Single-Family Residential
Resale Report - Duplex
Resale Report- Multiple-Family/Apartments First Unit.
Each additional Multiple-Family Dwelling/Apt. Unit
$290.00
$290.00/unit
$270.00
$30.00
$145.00
$145.00/unit
$135.00
$15.00
Resale Report- Condominiums $255.00 $128.00
Appeal $100.00 NA
Please note two factors. First, a “not applicable” entry has been placed in this table for appeals. An appeal
is offered to the customer that challenges the field inspection findings that are reported in the RBR. If,
during this interim period no field inspections are conducted, there would be no appeals. Second, during
this interim period, the fee would not be refundable. The current refund that is offered is for a “clean”
resale report that is issued based on the findings of the field inspection, which would not be conducted
during this interim period.
As noted, retroactive permits and penalties for unpermitted work that is disclosed as part of the RBR
inspection process leads to revenue collection. If the recommended resolution is adopted and inspections
are waived to the end of July, it is estimated that $80,000-100,000 in projected revenue from retroactive
building permit and penalties (investigation fees) may not be realized.
OPTIONS:
The City Council has the following options to consider on this matter:
1. Adopt the resolution as proposed by staff.
SAN RAFAEL CITY COUNCIL AGENDA REPORT / Page: 4
2. Adopt the resolution with modifications.
3. Direct staff to return with more information.
4. Take no action.
RECOMMENDED ACTION:
Adopt resolution.
ATTACHMENTS:
1. Resolution
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RESOLUTION NO. 15018
RESOLUTION OF THE SAN RAFAEL CITY COUNCIL ADOPTING AN EXTENSION
OF TEMPORARY MEASURES FOR ADMINISTERING THE RESIDENTIAL BUILDING
RECORD PROGRAM (“RBR PROGRAM”) SET FORTH IN SAN RAFAEL MUNICIPAL
CODE TITLE 12 (BUILDING REGULATIONS), CHAPTER 12.36 (REPORT OF
RESIDENTIAL BUILDING RECORD) DURING THE HIGH DEMAND REAL ESTATE
MARKET AND COVID-19 PANDEMIC
WHEREAS, on December 16, 2016, the City Council adopted Ordinance No.
1945 amending San Rafael Municipal Code Title 12, Chapter 12.36 (Report of
Residential Building Record), which set forth the general administration and enforcement
of what is known as the RBR Program. The RBR Program requires that upon resale of
any residential property within the City, the property seller shall obtain from the City a
report (resale report) of the City permit records and City inspection of the property. The
resale report provides an added level of disclosure to the purchaser of the property; and
WHEREAS, in tandem with the adoption of Ordinance No. 1945, on December
16, 2016 the City Council adopted: a) Resolution No. 14243 which sets forth the specific
policies, practices, and procedures for administering the RBR Program; and b)
Resolution No. 14244 which amended the City’s Master Fee Schedule to update fees
specific to the RBR Program; and
WHEREAS, Resolution No. 14243 includes, among others the specific process
steps for and required information to be included in a resale report. The resale report
must include a complete history of the property permit records (Building and Planning
Division permits) and code enforcement cases on file with the City. Further, a property
inspection must be conducted by a City inspector and the resale report shall include the
findings of the inspection and shall cite violations and/or unpermitted construction that
must be corrected or remedied. This resolution also includes a commitment that within
seven (7) business days following City receipt of the RBR application, City staff is to
contact the property owner/seller or their representative to schedule a date and time for
City inspection of the property; and
WHEREAS, on November 16, 2020, the City Council adopted Resolution No.
14757 which temporarily adjusted RBR fees and temporarily ceased the City’s
inspection portion of the RBR Program for six months. The resolution allowed, with an
assessment from Community Development Department staff on the status of the real
estate market and the COVID-19 pandemic, an extension of temporary measures with
approval of the City Council.
WHEREAS, on May 17, 2021, the City Council adopted Resolution No. 14912
which continued temporarily adjusted RBR fees and temporarily ceased the City’s
inspection portion of the RBR Program to the end of December 2021.
WHEREAS, San Francisco and the South Bay continue experiencing an exodus
of residents moving outward to the suburbs. A combination of factors is causing this
exodus including: 1) a permanent and sustained shift in the workforce to working from
home which started during the COVID 19 Shelter-in-Place Order; 2) high rents in the
San Francisco and South Bay; and 3) the low interest mortgage loan rates. The high
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demand real estate market has resulted in a low inventory and shorter property sale
transaction periods; and
WHEREAS, during the COVID-19 pandemic building permits and RBRs have
increased while there have been significant budget cuts and staffing reductions resulting
in slower processing times and inspection scheduling for resale reports; and
WHEREAS, the Community Development Department staff has continued to
collaborate with Marin Association of Realtors on the extension of temporary, interim
measures for administering the RBR Program during the pandemic and this high
demand real estate market. The interim measures include temporarily ceasing the City
inspection portion of the RBR Program through July 31, 2022;
NOW, THEREFORE, BE IT RESOLVED, that the City Council hereby adopts the
following temporary measures for administering the RBR Program:
1. The temporary measures authorized by this Resolution shall be in place and in
effect through July 31, 2022.
2. The City inspection, reporting of the inspection results, and the citing of violations
and unpermitted improvements outlined in and required by City Council Resolution
No. 14243 shall cease during this temporary period. All other RBR Program tasks
and actions outlined in Resolution No. 14243 shall continue to be administered by
the City.
3. During this temporary period, the contents of the resale reports shall follow the
requirements set forth in San Rafael Municipal Code Chapter 12.36 (Report of
Residential Building Record), Section 12.36.060 (contents of report) except that the
report will not include City site inspection findings.
4. The RBR application and related fees shall temporarily be adjusted as follows:
RBR Service Temporary Fee Reduction
Resale Report- Single-Family Residential
Resale Report - Duplex
Resale Report- Multiple-Family/Apartments First Unit.
Each additional Multiple-Family Dwelling/Apt. Unit
$145.00
$145.00/unit
$135.00
$15.00
Resale Report- Condominiums $128.00
Appeal NA
During this temporary period, no refunds will be issued.
5. During this temporary period, issued resale reports shall continue to be valid for a
period of six (6) months with the ability for a one-time extension of up to an
additional 90 days.
6. Following the sunset date or further extension of these temporary regulations,
enforcement of the RBR Program shall resume consistent with the adopted
policies, practices and procedures set forth in City Council Resolution No. 14243.
Further, at that time, the RBR fees shall return to the full application fee amounts
set forth in the City of San Rafael Master Fee Schedule.
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I, Lindsay Lara, Clerk of the City of San Rafael, hereby certify that the foregoing
Resolution was duly and regularly introduced and adopted at a regular meeting of the
City Council of San Rafael, held on Tuesday, the 18th day of January 2022, by the
following vote, to wit:
AYES: COUNCILMEMBERS: Bushey, Hill, Kertz, Llorens Gulati & Mayor Kate
NOES: COUNCILMEMBERS: None
ABSENT: COUNCILMEMBERS: None
LINDSAY LARA, City Clerk