Pittsburgh Post-Gazette headline, April 18:
“City won’t halt steep increase in zoning review fee – but is open to more discussion.”
Sane and rational interpretation by a reasonable and educated observer:
“Attention: All prospective Pittsburgh developers – drop dead.”
And that’s no hyperbole.
As the P-G’s Mark Belko reported it:
“The City of Pittsburgh won’t put on hold a sharp hike in a zoning review fee imposed in January but is open to at least discussing possible adjustments after hearing from developers outraged over the increase.”
And “open” certainly is a loosey-goosey exercise for city fee sharks.
But, first, the background:
As a New Year’s gift to would-be developers — and in a step that will only cement Pittsburgh’s reputation as “The City That Economic Growth Forgot” – it raised the zoning review impost by twentyfold, to $3 per $1,000 of project cost, the P-G reports.
Predictably, a growing number of developers are incensed. And more than a few are arguing that the increase is illegal, noting that such fees are meant to only cover the cost of zoning reviews and not be used as a revenue generator.
Heck, even the Allegheny Conference on Community Debasement, er, Development – which never met a corporate wealthfare package or new attempt to tax the region to prosperity that it didn’t wholeheartedly endorse – released a statement (weasel-worded though it was) questioning the fee hike.
The P-G further reports that a study commissioned by one city developer and other organizations shows the increased fee “far exceeds what a number of other cities would charge for a review of the same project,” as does the cost for a building permit.
“Pittsburgh appears to now be the most expensive city in the country to do business in,” the study stated.
We’re No. 1 and all that, right?!
Mayor Ed Gainey insists the increase is needed to cover costs and expedite the reviews. That sound of something akin to a gas well venting was the universal gang scoff of learned doubters.
And get a load of the administration’s “possible adjustments” alluded to at the outset. Again, from the P-G:
“(T)he administration also discussed the possibility of rearranging the fee schedule so that the fee is charged later in the process when a project is closer to final approval rather than at the beginning, when it’s still in the tentative stage.”
But raising the cost of such a fee now or later makes no difference. It’s still a raspberry to developers who correctly view it as government ramming its sticky fingers ever deeper into their pockets. And in a development market struggling with inflation and high interest rates to boot, the story reminds.
For far too long, Pittsburgh’s “leaders” have had what we’ll call “a government comprehension problem.” That is, a failure to comprehend the proper role of government in economic development.
Jacking up a government fee to a wildly exorbitant level to make your city even less competitive is a senseless exercise in ADS — assisted development suicide.
Colin McNickle is communications and marketing director at the Allegheny Institute for Public Policy (cmcnickle@alleghenyinstitute.org).
