Houston hikes 150 fees; businesses passing their costs to you
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Houstonians should be prepared to pay more to fix their cars, make minor home repairs and renew neighborhood association dues now that the City Council has voted to raise more than 150 fees by an average of 25 percent, said a handful of contractors and business associations.
Johnny Gibbs, owner of Lighthouse Electric, predicted Houstonians will balk at paying the higher fees for simple jobs like changing out a ceiling fan or replacing a light fixture.
He usually charges only $50 to $75 for that kind of work, but now the minimum permit fee for the contractor, which went up from $45 to $70, will cost as much as the job. Businesses generally pass the fee on to consumers.
"Nobody's going to want to pay that," Gibbs said.
The fee hikes have led him to consider taking his business outside the city limits.
"How much is enough?" he said. "How much money does the city need to be happy and to quit charging us more money all the time, because we can't afford it anymore?"
"What we're talking about are not core services in the city," Mayor Annise Parker told the council Wednesday. All Houstonians should not have to subsidize the costs for select permits, fees and services that are used by only a select few, she said.
The vote to enact the fee hikes was 11 to 3, with council members C.O. Bradford, Mike Sullivan and Jolanda Jones voting no.
Building permit fees are to go up Jan. 1, but the remaining fee hikes were effective immediately. The fees now will be a part of the city's annual budget process, increasing or decreasing based on the cost of service and inflation.
The city is expected to reap $6.5 million in the remainder of this fiscal year from the increases, and an additional $8.5 million in fiscal 2012, which begins July 1.
Andy Icken, the mayor's chief development officer, said the city will spend the next 120 days reviewing situations like the one brought up by Gibbs, and will evaluate whether they represent an "efficient way to do business."
"We're going to ask, 'Is there a better way to do it?' " Icken said.
Passing on the pain
Even with that change, city residents should expect businesses to pass on their higher costs from the fees, several business owners and trade association representatives said.
Homeowner association fees could increase, and hours for neighborhood pools might be reduced to make up for pool fees that went from $85 to $135, said Leslie Alvarez, president of the Clear Lake Superneighborhood Council.
Mark Lynch, owner of Lynch's Finest, a food stand outside Houston's criminal courthouse, said he may charge more for hot dogs or other food items because his license fee has increased from $310 to $575.
"If our fees get increased, we are going to pass that on to a homebuyer," said Adam Aschmann, director of government affairs for the Greater Houston Builders Association. He estimated that builders will now have to pay around $500 in new construction fees.
Comes at bad time
While some business trade groups, such as the Houston Apartment Association, praised the city for working with them on some of the fees, others said they could not have come at a more challenging time.
"This fee increase is incredibly disappointing, especially in light of the fact that auto dealers are coming off of a disastrous 2009 where they had to fight tooth and nail just to keep their doors open," said Wyatt Wainwright, president of the Houston Automobile Dealers Association. "When car sales plummeted 40 percent overnight, our dealers cut expenses to compensate for the reduction in sales. We believe our city government should consider doing the same."
During nearly a year in office, Parker has frequently pared back expenses, cutting police overtime, consolidating city departments and instituting voluntary furloughs to close a budget gap that still remains at $30 million.
The mayor said Wednesday that mandatory furloughs for civilian city employees will be instituted next year, although she had not yet determined how many.
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