Incentives Work Even for Bureaucracies
More important, the reforms also created a system that strongly incentivizes cities and counties to approve new home permits in a timely way. When a builder or property owner submits an application to build a new home, cities and counties have 30 business days to process it or request corrections.
If the government offices fail to respond in that time frame, the locality must refund 10 percent of the application fee for every additional business day of silence. Application fees can vary widely by locality, but the average cost in Florida is nearly $1,000, according to HomeAdvisor.com. If officials request corrections to the application, they have 10 business days to approve or disapprove of the resubmitted application. Blowing past that deadline leads to an automatic 20 percent refund, with a further 10 percent added for each additional missed day, up to a five-day cap.
This is from Hayden Dublois, “Florida started penalizing bureaucratic delay. Housing permits spiked,” Washington Post, July 25, 2022.
In the years leading up to the new law, the rate of increase for new home construction in Florida was about the same as the national average. Though many factors can influence home building, and the law was in effect for only a portion of the year, Florida’s home building rate in 2021 was two-thirds higher than the national average. More than 30 percent more permits were issued in Florida last year compared with 2020. Reducing red tape surely aided the boom.