From the Archives: Minnesota Building Permit Fee Surpluses


This week, the United States Supreme Court holds its oral arguments in Sheetz v. County of El Dorado, California, a case that examines two affordability roadblocks: building permit fees and municipal fee schedules. 

The central question posed to the nine justices is whether exactions based on municipal fee schedules, in this case building permit fees, are exempt from the criteria set in Nollan v. California Coastal Commission and Dolan v. City of Tigard

In Housing Affordability Institute’s archives are two research papers examining building permit fees in Minnesota. While separate from the Sheetz v. County of El Dorado case, these papers highlight the issue.

Findings:

  • Minnesota municipalities routinely over-collect building permit fees, adding to the cost of construction. In Minnesota, building permit fees 
  • Valuation-based building permit fees are inconsistent, even with the same home from the same builder as building officials are free to set the valuation at whatever level they choose. Building permit fee valuations are not to include the cost of land or lot improvements, so any variation should be minimal.