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DBI outlines multi-year fee increases and a new $3 million technology reserve; community partners warn cuts will reduce tenant services
Summary
At a Jan. 15 hearing the Department of Building Inspection presented a draft two-year budget that would raise fees in two phases toward full cost recovery by FY 2027, create a technology reserve, and reflects a proposed 15% general fund reduction. Community-based organizations said proposed cuts would shrink tenant outreach and habitability work.
The Department of Building Inspection presented its first of two budget hearings to the Building Inspection Commission on Jan. 15, detailing planned fee increases, a technology reserve, and potential cuts to community grants that support tenant outreach.
Patrick O’Riordan, the department director, described operational reforms completed in 2024 and asserted the department’s objective of improving permit review and inspection timeliness. “We are systemically improving the way we do business and rebuilding DBI one nail at a time, and one year at a time,” O’Riordan said.
Alex Koskinen, deputy director for administration, said the department is pursuing a phased fee increase to reach full cost recovery by fiscal year 2027 and to rebuild reserves. Under the department’s plan, fee revenue would rise from an estimated $60 million in the current year toward a proposed $75 million in fiscal year 2026, with a target of roughly $93 million to reach full cost recovery. Koskinen said the phase-in would reduce the immediate impact on customers; the presentation estimated a median per-fee increase of about 35% in the first fee step.
Koskinen said the budget includes a newly proposed technology reserve intended to fund a replacement of the city’s aging permit-tracking and related systems; the plan calls for a $3 million deposit in the first year and another $3 million in year two. He told the commission the reserve will likely be funded by a small surcharge on fees and that replacement of the permit tracking system (PTS) and associated division applications will require coordination and likely additional funding from other city partners.
The department’s budget assumptions also reflect a mayoral direction that departments identify a 15% reduction in general fund support for the upcoming two fiscal years; Koskinen said the incoming mayor’s office will review those reductions as the budget moves forward.
Community-based organizations that work with DBI on the Code Enforcement Outreach Program (CIOP) and the SRO Collaborative urged the commission to protect their funding, saying cuts would reduce tenant services and slow habitability enforcement. Sarah Short, director of counseling programs at the Housing Rights Committee of San Francisco, described the outreach partners as essential to bringing tenants into code enforcement and resolving cases without formal proceedings. Lisa (Chinatown Community Development Center) said the combined CBO appropriation — $4.8 million in the current year — faces further cuts that could reduce services by about 25% if the budget is reduced as presented. “A 25% cut would cost our program an estimated four to five staff positions,” she said.
Commissioners pressed staff on details including how overhead is allocated to fees, the timeline for the technology reserve, and the impact of the citywide hiring freeze announced by the mayor on Jan. 9. DBI staff said the fee model allocates direct, technical and general overhead costs across three hourly rates (plan check, inspections and administration) and that the department used time studies and productive full-time-equivalent calculations to set rates.
There was no vote on the budget at the Jan. 15 meeting. DBI will return to the commission for a second budget hearing on Feb. 12; final city budget decisions rest with the mayor and the Board of Supervisors later this year.
