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Draft Minutes
National Alliance's Affordable Housing Task Force
April 21, 2003 – 9:00 a.m. to Noon
National Association of Home Builders, Washington, DC

The third meeting of the National Alliance on Building Regulatory Reform in the Digital Age’s Affordable Housing Task Force was opened with welcoming remarks from the Alliance’s Secretariat NCSBCS and an expression of thanks to the meeting’s host, Ed Sutton, Staff Vice President – Construction, Codes & Standards of the National Association of Home Builders.

Attendance was taken and noted as follows:

Ed Sutton, NAHB
David Engel, HUD Office of Policy Development and Research
Michelle McDonough, National Housing Impact Division, Fannie Mae
Baxter Hill, U.S. Department of Agriculture’s Rural Housing Service
Robert Wible, Executive Director, NCSBCS

Mr. Wible noted that several other task force members had sent regrets that they were unable to attend the day’s meeting but had reiterated their commitment to the work products of the Task Force.

Mr. Wible reported that seven governors had noted in their inaugural or state-of-the-state addresses that one of their top priorities of their terms will be regulatory reform. Four governors identified regulations impacting construction or affordable housing as needing reform (OR, CA, MT, & WA).

The 2003 work agenda for the Alliance was reviewed in detail and the proposed work agenda for the Affordable Housing Task Force for the coming months. (Attachment A is the Alliance update report).

Meetings on regulatory streamlining and affordable housing between NCSBCS and home builders in Oregon, California, and Pennsylvania were discussed. Those meetings focused on the development of a cost benefit analysis study of the savings achieved by a jurisdiction streamlining its building regulatory process and using information technology.

David Engel reported on HUD’s affordable housing activities and the Department’s new Office of Regulatory Reform. The role of the new office was discussed and its objectives and proposed operating budget for 2004. It was noted that in the fall of 2003, HUD would hold a national conference on regulatory reform for association’s representing state and local government.

Mr. Engel also noted that the Brookings Institute was holding a program on the Impact of Smart Growth on May 29^th and described on-going HUD activities to support the PATH project.

Michelle McDonough described Fannie Mae’s ongoing affordable housing activities which includes 15 initiatives across the country on reducing regulatory barriers to affordable housing. Among these projects are work in Vermont on environmental regulations; rehab code work in Rhode Island; and the issue of lead based paint in housing in North Dakota.

Baxter Hill described the ongoing work of the Rural Housing Service. He noted that budgetary constraints had still kept RHS from funding the pending Alliance grant application.

Concern over issues of urban growth was discussed. This included impact fees and their becoming a barrier towards the construction of affordable housing was reviewed. Alliance members are continuing to monitor this issue.

Regulatory streamlining and the use of information technology to assist some rural communities to better handle the impact on them of rapid urbanization that is occurring in different parts of the nation was discussed. It was noted that this was an area that the Rural Housing Service and the Task Force partners should pay some attention to in their work plan and be a focus on adoption and use of National Alliance work products (model enabling legislation/regulations, procurement guidelines, interoperability standards).

The Task Force members then reviewed each of the contents of two current funding Task Force work efforts – the grant pending at RHS and one that had been submitted to the HUD Office of Policy Development (Attachment B & Attachment C).

The RHS proposal supports the work of the Task Force, expansion of its affordable housing and information technology database, and the development of a guide for building streamlining for rural communities.

The HUD proposal supports: the Affordable Housing Task Force; the development of the cost/benefit analysis measurement criteria for savings from the automation of building regulatory functions; the development of an outreach implementation plan and grant criteria for funding to help state and local governments adopt and use information technology in their building regulatory process; and research into the feasibility of governments mandating interoperable hardware and software in their procurements.

The Task Force reviewed these work products and their relevance to enhancing affordability of housing in the nation. It was especially noted that the cost/benefit analysis of regulatory streamlining was data that had not been gathered before and would be extremely helpful to other jurisdictions and home builders in considering actions to streamlining of their building regulatory processes. In preparing that analysis, care will be taken to compile data that both shows labor and financial carrying-cost savings to home builders and the staff labor and time cost savings to the state or local jurisdictions involved.

HUD indicated that it would be processing the Alliance’s grant in the coming weeks. Mr. Wible thanked Mr. Engel for HUD’s support for the Task Force and said that he would notify the Task Force members once work could begin on the above items. Task Force members were asked which tasks they would like to work on. It was noted that over the next few weeks that Mr. Wible would be meeting with home builders in the Silicon Valley region of California and in Oregon to discuss their involvement in the development of a cost/benefit analysis matrix for cost savings from regulatory streamlining. Those sessions also would include preliminary conversations with the state and local home builders associations regarding builders and jurisdictions that would want to participate in a subsequent six to nine month gathering of cost/benefit savings data from homes that are being built in selected jurisdictions (see HUD proposal for further details of this proposed future Alliance Affordable Housing Task Force work).

Arrangements also were made for Mr. Wible to meet with RHS state staff while in Portland.

There being no further business to come before the Task Force, NAHB was again thanked for hosting the days meeting and the meeting was adjourned at 11:45 a.m. The next meeting of the Affordable Housing Task Force will be held on June 4, 2003, from 9 a.m. to noon.

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ATTACHMENT B

FUNDING PROPOSAL

Submitted to the

Department of Agriculture
Office of Rural Development – Rural Housing Service

for a

Grant to the

National Conference of States on Building Codes & Standards, Inc.,

to Support the

National Alliance’s Affordable Housing
Task Force

and

Development of Draft Streamlining Guide for Rural Building Departments

July 8, 2002

Objective of Grant

The objective of this grant is to facilitate the successful launching of the Affordable Housing Task Force of the National Alliance for Building Regulatory Reform in the Digital Age and assure that its initial work specifically target the needs of rural communities to enhance the effectiveness and reduce the costs of the administration of their regulatory programs for residential structures.

This grant will accomplish that through support of the initial meetings of that task force, the setting of its work agenda, and the development of specific Alliance tools targeted at rural communities. Among those tools is specific information on building regulatory software systems being successfully used by rural communities to regulate the design and construction of housing and the development of a draft streamlining handbook for rural communities.

Background on National Alliance

The National Alliance for Building Regulatory Reform in the Digital Age, is a private-public partnership established to stimulate economic development and enhance public safety in buildings through the development of a series of work products and grants to state and local governments.

The Alliance grew out of two projects of which the U.S. Department of Agriculture’s Office of Rural Development – Rural Housing Service was an active co-sponsor. The first was the Streamlining the Nation’s Building Regulatory Process project. The second was a national forum held last summer in Arlington, Virginia, that brought together the nation’s construction community, government officials, and the information technology community to develop an action agenda that would assist in the use of information technology to transform the nation’s building regulatory process to enable our nation’s construction industry "to build, faster, better, safer at less cost."

Supported by grants from the White House Office of Science and Technology’s Subcommittee on Construction and Buildings, the National Conference of States on Building Codes and Standards and in-kind services from the Alliance’s 32 members, during the fall and winter of 2001, the Alliance held organizational meetings of three work groups: a National Steering Committee; Technology Task Force and a Planning and Coordinating Task Force.

Initial work products of the Alliance included: a database summarizing current software being used by jurisdictions to regulate various aspects of the construction process; an outline of a secure, nationwide, state-maintained database of as-built designs, evacuation plans and other contact information for first responders; a listing of streamlining projects that use information technology; and a project proposal to the White House Office of Science and Technology Policy outlining a national system of grants to state and local jurisdictions to conduct streamlining using information technology.

In the early spring of 2002, several Alliance members, including Fannie Mae, the National Association of Home Builders, U. S. Department of Housing and Urban Development, National Association of Counties, U. S. Conference of Mayors, NCSBCS, Association of Major City/County Building Officials, and U. S. Department of Agriculture’s Rural Housing Service, concluded that a fourth Alliance work group should be established to fast track Alliance work products to significantly reduce the regulatory costs of affordable housing.

Affordable Housing Task Force

The goal of this Task Force is to support the work of the National Alliance and fast track its products and grants to support state and local building departments and the nation’s housing industry to increase their use of information technology to streamline their regulatory and construction processes.

Grant Tasks

Plan, coordinate, and hold the organizational and follow-up work sessions for the National Alliance’s Affordable Housing Task Force. Modify existing National Alliance work products from Technology Task Force and Planning and Coordinating Task Force for use by rural jurisdictions. These products include:

1. An outline of model streamlined building regulatory processes for residential structure.
   
2. A listing of available software for jurisdictions to use to reduce the regulatory cost of construction.
   
3. Model enabling legislation for jurisdictions currently without a building regulatory system to adopt.

Under this task, a listing will be developed for the National Alliance website that includes names of those rural jurisdictions (and contact information) that use information technology to reduce the regulatory cost of residential construction. Funding for this task also will be used to review existing hardware, software and intermediate-ware that can be used in rural jurisdictions to expedite permit issuing, plans review, and field inspection processes. The resultant information gathered under this task will be posted on the National Alliance website. NCSBCS then will develop an outreach program through Department of Agriculture Rural Housing Service and National Association of Counties to inform rural jurisdictions of the availability of this information on the Alliance’s website.

Under this task, NCSBCS, in coordination with the Rural Housing Service, will prepare a draft of a guidebook for rural jurisdictions on how to modify their existing building regulatory system using information technology to reduce the regulatory cost of residential construction. Supplemental funding from National Association of Home Builders and U. S. Department of Housing and Urban Develop in the late fall of 2002 will be used to complete this guidebook and make it available for national distribution.

Time Frame: July 15 – October 30, 2002

The $24,000 in funding requested in this proposal is needed in three segments of $8,000 each. The first segment to support Tasks 1 and 2 is needed by the end of July 2002. The second request of $8,000 is needed by the end of August to support Tasks 1 – 3. The third segments of $8,000 is needed by September 30 to support Tasks 2 and 3.

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ATTACHMENT C

Affordable Housing Task Force Research Proposal
"Making Housing More Affordable through Regulatory Streamlining –
Facilitating Implementation of E-Permitting Systems &
Measuring Savings to Home Builders and Consumers"

Submitted by

March 31, 2003

Under this grant proposal, the Affordable Housing Task Force will form three project work groups to initiate an implementation program under this grant that will:

1. Develop measurement criteria for home builders and building departments to compile reliable cost\benefit data from savings that are achieved in the regulatory cost of building affordable housing through the use of information technology. Select two to four test sites for gathering the above data over a six month period. (Silicon Valley, California; Portland, Oregon, and the Commonwealth of Pennsylvania have volunteered thus far.)
   
2. Form an Electronic Permitting System Implementation Facilitation Work Team and develop a work plan and implementation grant criteria for a national outreach program to promote regulatory streamlining and greater use of information technology in the building regulatory process.
   
3. Conduct a feasibility study on mandating in IT procurements issued by state and local governments that hardware and software being acquired for use in building regulatory systems be interoperable.

WORK PROJECT TIME FRAME – APRIL 6, 2003 – MAY 31, 2003

Over the past two years the National Alliance on Building Regulatory Reform in the Digital Age and the U.S. Department of Housing and Urban Development’s Office of Policy Development and Research have conducted national forums and issued reports and other work products to enhance the production of more affordable housing in this nation by reducing the regulatory cost of construction through streamlining that makes greater use of information technology.

HUD has issued under its support for the Partnership for Advancing Technology in Housing (PATH) project two major reports. In the fall of 2002, HUD issued a report prepared by the National Institute of Building Sciences, "Electronic Permitting Systems and How to Implement Them," and in early 2003 HUD issued a report prepared by the RAND Corporation on "Building Better Homes – Government Strategies for Promoting Innovation in Housing."

In the summer of 2002, partners in the National Alliance on Building Regulatory Reform in the Digital Age established the Affordable Housing Task Force with the mission of: "facilitating the rapid dissemination to home builders, local and state building regulators, elected officials and the public of information on and set of work tools generated by the National Alliance that increase the effective use of information technology in the nation’s building regulatory process."

The National Conference of States on Building Codes and Standards submits for HUD’s consideration this proposal to build upon contents of the above recent studies released by the Department and the work products of the Alliance to further support the availability of affordable housing by establishing:

1. Measurement criteria to gather realistic cost / benefit data from home builders and building regulators regarding the savings in the regulatory portion of construction costs through the application of information technology in the oversight of the building permitting, design review and inspection processes.
   
2. An implementation plan and grant criteria for effective outreach program to state and local government and to home builders to work together to adopt and implement regulatory streamlining processes including the use of hardware and software systems described in HUD’s "Electronic Permitting Systems" report.
   
3. Research and issue a report on the feasibility of states and localities mandating in their procurements that hardware and software being acquired for building codes administration and enforcement be interoperable.

1. Most past cost/benefit information on savings from use of information technology in regulatory oversight of housing has been anecdotal.  Few building departments and home builders have compiled or kept such data. 

This proposal will develop and provide a simplified reporting mechanism for both parties to compile such data and explore selecting two to four regions in the nation where such data will be acquired over a six month basis (under subsequent funding).

In addition during the April 6 – May 31 period, this project will work with home builders in those (two to four) potential selected regions to establish the mechanism for subsequently acquiring data on the construction of homes of the same design and construction materials in two jurisdictions within their overall region – one which uses information technology in its building codes administration and enforcement program and one which does not.

At present three states have expressed interest in serving as one of the cost/benefit data-gathering cities. These include: jurisdictions and the home builders association in the Silicon Valley area of California (an initiative that would be supported by the California Department of Housing and Community Development and Governor Gray Davis’ recently announced affordable housing initiative – "Build California"), the metropolitan Portland, Oregon Tri-County area and state association of home builders (an initiative supported by Governor Ted Kulongoski’s state "Regulatory Streamlining Initiative" which is overseen by the Oregon Department of Consumer and Business Services), and the Commonwealth of Pennsylvania and its new statewide building code which is scheduled to become operational in early 2004.

2. HUD’s recent report on the "Electronic Permitting Systems and How to Implement Them" and its location on the HUD User website coupled with work products on the National Alliance's portion of the NCSBCs website are static products.

A dynamic outreach initiative is needed to support state and local governments and the construction communities working together to take action to use these materials.

The National Alliance is committed to seeking funding support for a major multi-year nationwide effort to launch regional demonstration projects and then follow-up with state and major city implementation grants to spread across the nation, regulatory streamlining and the effective use of information technology in the administration and enforcement of building codes and standards.

Under this proposal, the Affordable Housing Task Force would take the first step in such an effort to spread regulatory streamlining and the use of information technology in the effective and efficient oversight of design and construction of housing (and other buildings), by developing the implementation plan and grant criteria for this program.

3. Jurisdictions struggle with coming up with effective procurement criteria for the acquisition of hardware and software for the codes administration and enforcement programs.

The HUD PD&R report on Electronic Permitting Systems has an excellent section on "Implementing Electronic Permitting In Your Jurisdiction" which includes procurement recommendations. Lacking from that section, however, is any information on whether or not jurisdictions should be mandating that such hardware and software be interoperable. Lack of interoperability means that jurisdictions end up with problems of not being able to use legacy systems, or building, at great expense, what in affect are "one of a kind" hardware and software systems that are overly dependent on a single software or hardware provider. (Moreover, lack of interoperability most likely will preclude neighboring jurisdictions being able to share building data during a natural or manmade disaster).

To help lower the cost of information technologies to jurisdictions, the National Alliance’s Technology Task Force is charged with seeking out ways to promote interoperability among all such hardware and software. The Alliance includes in its membership the International Alliance on Interoperability, the National Institute of Building Sciences, and the National Institute of Standards and Technology where such interoperability research work is being conducted and/or monitored.

Under this proposal, the Affordable Housing Task Force will research the current status of efforts within this nation to make the interoperability of hardware and software being used in the oversight of the design and construction of housing a reality. Input from this effort will provide the Alliance and HUD with a timetable and list of steps to either immediately enable states and localities to demand interoperability in their procurement proposals, or speed up the development of interoperability requirements that later can be included in state and local procurements.

1. Hold meeting of Affordable Housing Task Force and establish three project work groups – early April 2003
2. Work groups meet to develop project work criteria – mid-April 2003
3. Meeting with sample jurisdictions and their home builders associations to considered as sites for gathering cost/benefit data – late April/early May 2003.
4. Meetings with hardware and software and interoperability community to ascertain current and future feasibility of mandating that successful bidders on IT hardware, software procurements for building departments have their products be interoperable – mid-May 2003.
5. Follow-up meeting of three project work groups – late May 2003
6. Second meeting of Affordable Housing Task Force – late May 2003
7. Final report to HUD under this Grant – May 31, 2003

$ 25,000 in grant plus $8,000 of in-kind services from National Alliance members.

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