Minnesota State Wire

A home building and remodeling advocacy group recently told a U.S. Senate select committee on home ownership affordability and availability that local governments are inflating their inspection fees.

BATC-Housing First Minnesota alleged that some cities are using the revenue from inspection fees for local projects and said that municipalities throughout the state have collectively accumulated $78 million during the past five years; all at the expense of homeowners.  

“The urgency of this crisis cannot be overstated,” said David Siegel, executive director of BATC-Housing First Minnesota, in the Twin Cities Pioneer Press. “Virtually all the housing roadblocks are in the way we regulate homebuilding in Minnesota.”

The Pioneer Press reported that fees are collected to offset the cost of the inspection expenses at the local level but BATC-Housing First Minnesota officials are not convinced. They believe it could be a major factor in the unaffordability of the Minnesota home.    

Nick Erickson, manager at Housing First Minnesota, concurred that the fee issue is the primary one that lawmakers should be addressing in regard to housing costs the Pioneer Press reported.

Siegel said U.S. Census Bureau data shows that Minnesota has the lowest homeowner vacancy rate in the nation, and the most expedient way to facilitate a constructive change would be to reduce the inspection permit fees the Pioneer Press reported.

Minnesota municipalities are permitted to obtain fees that cover the actual costs of performing the inspection service. Cities around the state argue that fees are needed to cover costs associated with planning, zoning, engineering and administration.

Cities reporting the amount of revenue acquired from inspection fees during the past 10 years reflected a financial deficiency when reconciled with their expenses the Pioneer Press indicated.