Building revenue drops during unsure economy
BY DAVE BENJAMIN
Staff Writer

JACKSON - The number of building permits being issued by the municipality has ebbed downward for the third year in a row.

At a June 20 meeting of township department heads, a summary spread sheet was produced which indicated the number of building permits processed, the type of work being done, technical subcodes and other pertinent information from 2002 to 2007.

"These figures are for construction, reconstruction, additions, modifications or things like putting a new roof on a house," said Daniel Burke, municipal engineer. "For the type of work the chart gives a breakdown of new buildings, additions, alterations and demolitions."

Burke said the chart provides a breakdown by fee summary, which includes building, electrical, plumbing, fire and other categories.

"The fee summary is something we use," he said. "That department is supposed to be self-liquidating. They generate the fees to cover their costs, equipment, labor and so on."

Burke said there appears to be a downward trend, noting the decrease of permits over the past several years.

"Jackson has long wanted to reduce its residential housing buildup," he said. "The consequence with the lower number of permits and fees is that we have to watch our labor costs because our fees are dropping significantly."

Noting one example, Burke said, "This year we are at $368,685, where last year we were at $590,524 and in 2005 we were at $646,432. That's a significant downward trend."

He said the township is down to almost the 2002 and 2003 levels of construction for total building fees.

Construction official Barry Olejarz said the summary was produced for the first half of 2007 in order to show the new administrator, Phil Del Turco, where Jackson is regarding construction.

Olejarz said he believes the downward trend is basically due to the economy and the fact that people are not buying homes.

"It goes in cycles," he said. "There was a big influx a few years back and now it dropped [again]. It's going through that same economy situation where there was a big boom. Now everybody is hesitating about spending money and buying houses."

When asked if this situation has anything to do with the number of applicants before the Planning Board at the present time, Olejarz said the developments that have been previously approved by the Planning Board are still on the rolls for construction and what the board continues to approve will be added to the planned housing stock.

Olejarz said some developers obtain an approval from the Planning Board and then wait for the economy to turn around before moving forward with their plans.

"It really depends on the economy and how the housing market is," he said.

Normally swimming pool permits and other projects produce revenue for the department during the summer, but that is down, too, he said.

"People are being more frugal with their money because they're not sure where they economy is going," Olejarz noted. "Basically, they're holding back. Where it might be nice to have an in-ground pool, some people may be going with a smaller above-ground pool or taking trips to the beach or their friends' houses.

"The building department is probably the only department in the community that is self-supporting and does not draw from tax dollars," he said. "In order to make sure we are continuing [to be self-supporting] we have to take appropriate action, whether it's raising the appropriate fees or laying people off."