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At the Terrebonne Parish Council’s Finance and Budget Committee meeting on Monday, Council Member Dirk Guidry had questions.
The committee was going through its next rounds of reviews for the parish’s 2018 budget, and Guidry was asking about Terrebonne’s Planning and Zoning Department budget. He noted the large increase in the department’s personal services spending from its 2017 total.
Guidry’s questions touched on a current sticking point between parish administration and the South Central Development and Planning Commission leadership over the dollar figures associated with Terrebonne Parish Consolidated Government’s plan to move inspecting back under the parish’s auspices, removing it from the SCPDC. Parish President Gordon Dove, Planning and Zoning Director Chris Pulaski and Terrebonne Chief Financial Officer Kandace Mauldin have said the parish will save more than $100,000 annually by taking over inspection services. SCPDC CEO Kevin Belanger, Parish Council Member Gerald Michel and the Terrebonne Home Builders’ Association remain skeptical of the parish’s position it will be able to save money while maintaining the quality of service.
Dove originally proposed moving inspection and plan review services within the parish in April of this year, due to the SCPDC’s desire to change permit rates, which Dove said would harm commercial builders in an already-flagging local economy. However, the parish and South Central struck a deal, where the SCPDC would keep permit rates the same while Terrebonne would keep all permit fee money – rather than the 80-20 split between Terrebonne and South Central it had at the time – while paying the SCPDC a flat rate of $640,000 to administer inspections in the parish for the year. Dove has proposed Terrebonne taking over inspections next year to reap savings he and his adminsitration say they have found.
South Central sought to change permit fees to a consistent rate of 60 cents per sq. ft. of building construction to standardize commercial building permits. Belanger and other SCPDC officials have documented previous instances of a person, acting as both the owner and builder of the property, writing bogus contracts of the cost to construct a building to deflate construction costs and save money on permits, which could charge $3 per $1,000 of the contract’s value. By removing the option of using contract values, SCPDC hoped to have a standard permit rate unable to be cheated. Pulaski noted bogus contracts are a problem, albeit one that can be detected and addressed, but that the higher costs would harm builders playing by the rules.
“It was a good idea to adjust it. But the impact it was having was that some of the fees were going up, and with the economic climate going up, it didn’t seem right to raise permits on anyone,” Pulaski said.
Administration officials estimate the parish will spend about $521,000 in 2018 on administering inspection services, a savings of about $119,000 on its annual payment to the SCPDC.
The proposed planning and zoning budget increases to about $1.72 million in 2018, an increase of $55,051 from the $1.68 million it budgeted for this year. Pulaski and Mauldin said the increase is a function of adding inspection services, an increase in insurance costs for parish government as a whole and the one-time capital investments in trucks and technology needed to do inspections.
The largest increase in planning and zoning comes in the form of personal services, which constitute salaries and benefits, and is increasing by $479,656 from the 2017 budget. The parish is adding five positions – one building official, one plan examiner, two inspectors and one administrative coordinator – to handle inspections, while it also proposes adding another planner to help with the entire department rather than work on inspections. Mauldin said the increase results from both adding the six positions and about a 12 percent increase for health insurance in the entire parish government.
Mauldin and Pulaski said the parish will be spending about $410,000 in salaries for the inspection department. The combined salaries of the six new positions at the parish’s mid-range pay rate along with the standard benefit rate of 45 percent of salaries amount to $564,171.80. When keeping salaries and benefits at the mid-range rate and removing the salary of the proposed planner hire, the planning and zoning department is slated to spend $477,657.55 on the five employees handling inspections. However, Mauldin said the parish did not use mid-range rates but instead budgeted for the highest insurance packages to give the parish flexibility in its compensation packages.
“We probably used a little bit lower than mid-range,” Mauldin said. “But I don’t want you to get so caught up in what range we’re doing because we have some movement within our budget, such as movement within the insurance. So if they don’t need the higher coverage, we may be able to pay them a little more in salary. So I don’t want it to sound like what we use in this budget is going to be offered to everyone.”
Pulaski said he was not concerned about the parish harming its ability to attract talent by using a pay scales lower than its mid-range scale. He said he thinks Terrebonne will be able to bring in qualified people to handle the parish’s inspection department.
“What I’m charged with and what I’m going to make sure of is we’ve got qualified people in those positions,” Pulaski said. “Qualified people who are personable. They’re out in the field dealing with the public every day. We want to have good, quality people in these positions,” Pulaski said.
Guidry asked about the $112,746 the parish is proposed to spend on “other services and charges” in 2018, which Mauldin said would be for administering inspection services at the committee meeting. However, in a later conversation Mauldin said the $112,746 would be for general department costs unrelated to inspections, noting the parish council will soon vote on a budget amendment to increase planning and zoning’s 2017 other services spending by $157,000, as the department incurred other costs throughout 2017 and still has to make up for the rest of the money it owes South Central for the year.
Terrebonne is also spending more on supplies due to its takeover of permitting. The planning and zoning supplies and materials spending is $78,473, more than double the $36,400 it has budgeted for 2017. Mauldin said $30,000 of the increase is related to the purchase of the MyPermitNow software from SCPDC and another $12,000 is due to the need for additional supplies like paper and other materials due to having more personnel.
Planning and Zoning is spending $67,000 in capital outlay to purchase two trucks, two computer stations and two laptops for inspection staff. Those purchases will not be repeated in future budgets until the parish has to replace the vehicles and technology.
When adding the parish’s stated personnel spending, its software purchases and not including any other supply costs and capital outlay, Terrebonne’s inspection spending adds up to about $507,000, less than its advertised figure and less than its payment to South Central.
If one were to include the $112,000 “other services” spending, the figure jumps to about $620,000, less than its 2017 South Central payment by $20,000 but about what Belanger said the SCPDC would charge Terrebonne for 2018 services due to lower permit numbers. If including the other services again and having the parish pay mid-range salaries and standard benefits to employees, the parish’s spending amounts to a little more than $687,000, although again Mauldin said the parish has planned to spend less on compensation and does not include other charges in its estimation of inspeciton spending. Budgets beyond 2018 would not include the $67,000 for truck and technology purchases.
Belanger, who previously worked in the parish’s permitting and inspections department, remained skeptical of the administration’s ability to both keep costs down and provide the same level of service. He noted South Central has a large number of inspectors due to its size as a regional planning department servicing servicing parishes and 11 total jurisdictions. When Terrebonne is particularly busy with construction, SCPDC can allocate additional inspectors there to handle a larger workload. Belanger expressed concerns about Terrebonne only having two inspectors to handle the entire parish, noting it is running on thin margins if one of the staff members were to be sick or have to take a day off. He said he was skeptical of the parish’s ability to both have savings on a smaller staff while maintaining service to builders.
“I can’t imagine a lesser budget than $650,000 – $750,000. There’s no way that they will have the same level of service,” Belanger said. “If they go with other types of services, meaning if you call us today we’ll get to you next week, maybe they’ll be able to do it.”
Michel expressed the same concerns about a lack of manpower in the proposed inspections department. He said the limited numbers would either have to work around being short a staff member or hire additional staff.
“Why change it? The chance that we might save a few dollars – I don’t think we’re going to – what’s going to end up happening is we’re going to dig a hole we can’t get out of, so we’re going to have to start hiring additional people to cover for the shortcomings that we’re going to have,” Michel said.
Pulaski said the department would have redundancy in the building official and plan examiners being able to conduct inspections were the parish to need extra staff. He also said if things really pick up, the parish would theoretically have more permit revenue to offset the hire of additional staff. Pulaski said while South Central’s service has not been bad at all, he is confident Terrebonne can do the same job for less.
“We can do it for less. Why [South Central is] $640,000 and we’re not, we’re not quite certain of. I’m certain of our numbers being what they are,” Pulaski said.
Michel said when he went over the budget, he saw the parish spending at least $100,000 more in the first year on inspections, although that price would decrease in the future. He joined THBA President Joey Yesso in expressing concerns about the permitting process becoming politcized, noting that the SCPDC provided a regional and independent body for inspections. Yesso said moving inspections back within Terrebonne could make inspectors more susceptible to pressure from higher-ups on overlooking inspections or bogus contracts.
At Monday’s committee meeting, Michel recommended changing the 2018 planning and zoning budget to resemble its 2017 figures, with the inspection positions eliminated and the contract with South Central continuing. The council will get the chance to vote on the proposed change whether Dove approves the change or not, but the parish president could veto the vote. In that case, the council would need a two-thirds majority vote to override the veto if they want to continue the agreement with South Central.
Council Member John Navy said he has continued to talk to Mauldin and Belanger to gather information on each side of the planning’s budget debate. He said he has not gone through the budget with Mauldin to work out the savings, but if he does see the parish saving money he will support Dove’s inspection plan.
“I really can’t speak for the rest [of the council]. This is what I would say: if there’s savings involved in it, then definitely I’m going to support it,” Navy said.
