Sluggish economy keeps Garfield County building permits in the basement
Post Independent staff
Glenwood Springs, CO Colorado
Garfield County officials said on Wednesday that all signs point to continuing sluggishness in the local building market, although they expressed the hope that things might pick up by the end of next year.
Building official Andy Schwaller said that the current tally of building permits issued for 2009, for both residential and commercial projects, stands at 133 as of the end of June, as compared to 200 permits issued by the same time in 2008 and 254 in 2007, which Schwaller described as “kind of the peak” in terms of recent building activity in the county.
“It’s quite the decrease,” Schwaller said of the 2009 numbers. “More people are doing remodels, finishing up their basements, that kind of thing” than building new homes.
Also lower this year, said Schwaller, is the valuation of the permits issued.
He said the values assigned to permits as of June, 2009, was $15.7 million, compared to a valuation of $34.8 million a year ago.
Typically, Schwaller said, the number and timing of building permit applications reflects the ability of builders to obtain financing, explaining that in normal years “there’s kind of a peak now,” in the middle of the summer that tapers off to a wintertime lull.
Fred Jarman, director of the Building and Planning Department, said applications were off by roughly 25 percent, and that the decline in departmental business is expected to be off by 38 percent by the end of 2009.
One indicator of the economy’s health, he said, is the amount of money the department took in from developers. He explained that “we bring in money for the county” in the form of permit and review fees, compared to some other departments that provide services paid for by taxpayers. Jarman stressed that the use of revenues from departmental fees is only “a very general measure” of planning activity.
He said the fees for 2006 and 2007 held fairly steady, at about $1.18 million for 2006 and just over $1.2 million for 2007. But revenues dropped off sharply the following year, to $874,000. Jarman said current projections are for the departmental revenue to fall to $510,000 for all of 2009.
Looking strictly at commercial development, Jarman said that the permits “stayed really steady” over several years. He said the county processed 66 commercial building permits in 2006. The number rose to 99 in both 2007 and 2008, but is projected to hit only 90 this year.
In terms of the number of development plans submitted to his department this year, Jarman said that there are no exact numbers yet but estimated that this year “there is a drop, but not nearly as drastic” as the decline in building permits.
Although he could not be certain, he reasoned that this is an indication that “people still want to plan” for development, and then wait for financial backing to become available as the regional and national recession turns to recovery.
But, he said, while area general contractors seem to not believe that the economy is going to make a significant turnaround any time soon, oil and gas operators apparently see improvement on the horizon. Jarman said people he has talked with feel the local economy might begin to improve by late 2010 or early 2011.
But, he admitted, “Honestly, I’m the last to know. By the time they come in here, they’ve already got their financing in place and are ready to go. But I’m not sure we’re going to see major development for a while.”
Editor’s note: Tomorrow, the Post Independent will examine how Garfield County’s building permit slump compares with municipalities around the county, and with surrounding counties.
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