Dallas permit error cost city nearly $9 million in fees

DALLAS - The City of Dallas says a building permit fee error led to a loss of nearly $9 million.

Now, Dallas City Council is working to approve a fix to get things back on track.

This error is just the latest in a string of issues involving permits with the City of Dallas over the last five years. 

City error on permit fees

What we know:

During Monday’s Dallas City Council Economic Development Committee meeting, the city's Planning and Development Department revealed a staffing error in calculating the city's commercial remodel permit fees.

This error cost the city about $8.6 million.

According to Dallas Planning and Development, it happened after the city implemented a new permit fee structure in the spring of 2024.

There was an error included in the formula for calculating permit fees for commercial remodels that resulted in a large decrease in fees for larger projects. 

To remedy the situation, the Planning and Development Department recommended going back to an older fee structure and adjusting for inflation. Plus, amending fees for expedited plan reviews and combining certain other fees. 

Developers will see a price increase, but if the issue isn't solved, the city will continue to lose money. 

What they're saying:

Dallas Planning and Development Department assistant director, Catherine Lee, said it took immediate action after learning about the shortfall. 

"Once we realized we had this issue, we did take proactive measures. We’ve had a hiring freeze other than hard to fill positions and inspector positions. We’ve deferred fleet replacement, limited staff over time and out-of-town travel and training," said Lee. "For every month that this item is delayed our department is forgoing an average of $1.1M per month." 

After the presentation, the committee members moved quickly. There was no discussion, so it moved straight to a vote. 

Dallas permit issues

Dig deeper:

Over the last five years, the City of Dallas has faced other issues surrounding permits. Including a massive backlog and purchasing a $14 million building to house the city's permit staff that needed extensive renovations. 

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City of Dallas questions $14 million purchase of now-vacant building permit office

The 11-story office tower bought for $14 million now sits unused by the city of Dallas. Now, the city is seeking outside help to figure out who was involved in the purchase, how much money the city has spent and how much more it will cost to bring the building into compliance.

What's next:

The City Council can take action on the recommendations on April 23 and, if approved, then the new fee pricing would go into effect on July 1.