We have herd that the Town’s Planning and Building Department holds excess deposits and does not return them until property owners ask for them back!
Currently, the Town requires deposits for purposes of recovering Town costs for processing planning and building applications and providing services; such as consultations from geology, engineering or planning experts, as well as the cost of Town staff working on the project. These deposits can be thousands and thousands of dollars.
The most recent Town Resolution that we could find was adopted in 1995. It requires deposits to be placed in an interest bearing account but the interest is retained by the Town “as compensation for costs of accounting and handling said funds.”
Ok, so the interest is paying for accounting costs, etc. That makes sense. But then there is a “ a 25% overhead charge shall be added to all outside consultant deposit costs to cover the Towns costs of administering consultant contracts, providing space, and materials for consultants, and administration of billings.” These consultants can be pretty expensive. Does it really take 25% irrespective of the amount to provide cost recovery.
What is even more interesting is what was not included in the Resolution. There are requirements as to when the applicant must pay the deposits and a “Penalty Fee” for Delinquent Deposit Payments of $200 per deposit account if it is not paid within 30 days after the date of an invoice from the Town and $100 for each additional 30 days the deposit is late.. However, there is no discussion of when excess deposits will be returned to the applicant. And, from what we have herd, the Town has not been giving back excess deposits until it receives a written request. If there is no request, the funds are held indefinitely (accumulating even more interest).
As we understand it, many involved in the often long and arduous planning process have no idea that they maybe owed excess deposit money. It is assumed that any excess will be automatically returned. Shouldn’t the Town, once a project has had its final inspection, immediately return any unused funds? Perhaps if the Town does not immediately return that money, they too should be held acow-ntable for a Penalty Fee.