The pandemic-induced collapse of the city’s permitting process has exposed other fissures that are still causing weeks of delays for developers awaiting permission from Dallas to start working. The city manager’s self-imposed 100-day deadline to fix the permitting problem came and went, and the new head of the Development Services Department told the Council yesterday that updating software and hiring and training staff could take up to three years to complete.
Residential developers waited an average of 32 days in September to get their permit, according to city records. That was down from 40 days in September of 2021, and the peak of 140 days that February. But that doesn’t jibe with what developers are reporting to the Dallas Builders Association. That organization surveyed its members about 95 homes that had been permitted since May 1. That survey’s findings:
- 81 percent of those surveyed said that recent permits took 10+ weeks
- 55 percent said that prescreen (the time from submission to when the city asks for payment of fees) is taking more than 4 weeks.
- 83 percent said that zoning review took them more than 4 weeks.
- 70 percent said that water and wastewater review is taking more than 4 weeks.
This issue grew so severe that it almost resulted in the city manager’s ouster. And based off yesterday’s council briefing, we’re only just now diagnosing the true rot. Neighboring cities process permits within days. (Fort Worth processes single-family permits within 7 days, on average. Commercial permits are harder to gauge, because the projects vary in complexity.)
So what’s happening here?
First is technology, something that’s plagued the department since COVID forced staff to work from their homes with old laptops and new software for which they hadn’t been trained.
Andrew Espinoza, the director of Development Services, said that the two main pieces of software used to shepherd permits through the approval process were incompatible, which makes staffers “perform duplicative effort.”
“That really slows us down,” Espinoza said. “The systems do not communicate with each other, so what we do on one side of the computer we have to do on the other.”
Those systems are called ProjectDox and Posse. The latter is out-of-date land management software, which the city is working to replace. Assistant Director Vernon Young told Council that Posse is so old that the “iPhone was not even out at that time.” He estimated that Dallas has been using that software for 15 years. Espinoza said replacing and implementing it would take about two years, and estimated that training staff would take another year.
Second is how City Hall is structured.
Getting a permit is not just the purview of Development Services. Engineers must certify the work. Water and fire must ensure plans are up to code. Sometimes, housing gets involved. Advocates for commercial and residential developers say it doesn’t appear that all the city departments that touch permits communicate effectively.
“We’re looking at a deal today,” Linda McMahon, the president of The Real Estate Council, said in an interview on Thursday. “Development Services is waiting for the Housing Department and the person who is supposed to help is out of the office. Nobody from Development Services picked up the phone.”
Human resources operates separately, and so does IT. (Although Espinoza announced that his department would be receiving five full-time IT employees to help solve this problem.) Even the consultant hired to produce recommendations, Matrix Consulting Group, only studied the Development Services Department.
“There’s no such thing as a one stop shop here,” McMahon said in an interview. “If you have a problem with one department, that’s a problem with that one department. There is no collaboration across departments to solve that problem.”
Espinoza said he expected wait times for residential permits to be no more than 5 days by the end of next September, in part by solving some of those communication and workflow problems.
“The permitting office is our gateway to housing, which we need,” said Councilman Chad West, who represents North Oak Cliff. “It’s our gateway to property taxes, which we need, and it’s our gateway to construction jobs.”
The third problem is staffing and pay.
Majed Al Ghafry, the assistant city manager responsible for economic development, told Council that the city was losing staff to private sector jobs that pay anywhere from $10,000 to $70,000 more annually. But some on Council saw a way around this. Development Services is part of the city’s enterprise fund, which means it’s funded by money collected for the services it provides and not from taxes. And that gives the city more wiggle room into how the department is operated.
West called on Espinoza to re-evaluate the pay structure to help attract and retain talent.
“This is where everyone in the city should want to go to work,” he said. “You get paid more, you get an opportunity for advancement—why can’t we shake up the way we cover this department’s pay scale?”
Espinoza was asked to brief the council’s Government Performance and Financial Management Committee on a way to achieve this.
The department has 78 vacancies, which is just about a quarter of its 304 total employees. This year’s budget, which began on October 1, included money to hire another 54 people, which the city is pursuing through job fairs and municipal hiring websites.
But developers want to see more.
“We have complaints on everything from someone trying to do a tenant improvement that’s 1,000 square feet up to hundreds of thousands of square feet of new construction,” McMahon said. “But the biggest complaints I get are about the smaller projects.”
Nathaniel Barrett is one of those smaller developers. He sent a letter to Espinoza this week that asked Dallas to adopt self-certification for projects that would require no change of use, occupancy, or egress. Such a program is employed in New York, Austin, and San Antonio. Al Ghafry said he is studying those cities.
Some on Council tried to steer the focus to the positive, how average residential permits were being processed quicker than they were even months ago. Young, the assistant director, relayed the Council an anecdote he apparently said the other day. “You go in and six people order steak and one person gets a bad steak, you hear about the one person.”
Phil Crone, the president of the Dallas Builders Association, brought up the recent survey. “That’s a lot of bad steak,” he said.
Deputy Mayor Pro Tem Omar Narvaez piled on, saying “we’ve gotta be positive. When we’re negative at this horseshoe, that becomes the norm.”
“These mistakes didn’t happen overnight, they’re not going to be cured overnight,” he said. “When you’re trying to change something that’s systemic, it takes time.”
But Councilwoman Cara Mendelsohn fired back: “The fact is that this department is not functioning as it should.”
Until it is, expect to see more of these briefings—and developers are expecting to see more delays.
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