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Government adds to building costs

Scott N. Miller
Vail, CO, Colorado
Dominique Taylor/dtaylor@vaildaily.comAdding to the cost of building in the county is the various fees governments demand for everything from inspections to water and sewer taps.
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EAGLE COUNTY ” Call it “permit shock.”

The cost of building in Eagle County isn’t limited to checks written to builders, plumbers and electrician. The cost of the various permits can add up quickly, too.

In Eagle, the cost of government approvals and hooking up to municipal water and sewer systems can add $9 or more per square foot to a relatively modest single family home.

It can take some people building their first homes in the county by surprise.

“I see it all the time,” said Michael Hazard, an Avon architect. “People come in from other parts of the country and they’re surprised.”

Jon Stavney is a project manager for Beck Building Company and the mayor of Eagle. He also built his own home in Eagle a few years ago.

“I had to write a check to the town to the town for about $18,000,” Stavney said. “I want to tell you, that hurt.”

The need for fees

But Stavney also understands why builders pay those fees.

“We had to spend $2 million for a water pre-treatment plant in Eagle,” he said. “We’re also looking at expanding our wastewater plant. We have to pay for those somehow.”

Hazard, who’s worked in the valley for about 30 years, also designs homes for clients in other states. He said the way fees are levied aren’t entirely out of line with the rest of the country.

“Local governments use guidelines developed through the Universal Building Code,” Hazard said.

That code, developed by a national group, is used as the basis for building regulations around the country. The formulas include charging builders based on the value of what they’re building. Expensive real estate equals expensive fees to build.

Hazard said the various permits and fees help cover the costs of reviews. Water and sewer fees, in theory, cover the costs of providing those services.

In Edwards, though, the Eagle River Water and Sanitation District is charging a new fee for water so it can expand its water treatment facilities. Even with that extra charge, it’s still cheaper to get water service to a 3,000 square foot home in Edwards than in Vail.

The ‘use tax’

It would be cheaper still to build in Eagle or Gypsum if not for an additional fee those towns charge. That fee, called a “use tax,” is essentially a sales tax on building materials. Those towns charge that fee for materials that aren’t bought in either town.

“You don’t pay city sales tax on that material,” said Pete Peterson, the lead building official in Gypsum. Peterson said builders can get rebates if, for example, they buy windows and doors at Home Depot in Avon and end up paying that town’s sales tax.

Providing receipts for building materials bought in Eagle and Gypsum will also qualify a homeowner for a rebate.

While the fees to build a new home can add up, Stavney, who manages the construction of very expensive homes, said he believes the fees on those houses is fair.

What he would like to see, though, is a break for the little guy.

“I think in the case of people trying to do affordable housing, we need to meet folks halfway,” he said. “But man, we have a lot to pay for.”

Business Editor Scott N. Miller can be reached at 748-2930, or smiller@vaildaily.com.


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