The number of homebuilding permits issued in Howard County, which until recently numbered 4,000 a year, has dropped off dramatically because of a cap on new residential development and a slumping economy, county officials said yesterday.
Only 962 permits were issued during the first eight months of this year, prompting the president of the county Home Builders Association to say the growth cap has proven "disastrous."
If the trend continues, the county could issue fewer than 1,300 homebuilding permits this year, although County Administrator Buddy Roogow said he thinks the number will range between 1,500 and the 2,000 allowed under the cap.
In addition, he said the county also will issue permits for several hundred low- and moderate-income units excluded from the 18-month cap, which took effect last September and expires next March 31.
Mr. Roogow also noted that there was a "stockpiling" of homebuilding permits last year, when some 5,000 were issued before the cap took effect.
In any event, the downturn in homebuilding and commercial construction has raised concerns about the impact the slump will have on county revenues.
Mr. Roogow said the administration will try to cut spending by "several million dollars" by deferring the purchase of large pieces of equipment and delaying filling vacant positions not connected with public safety.
"We are not panicking, but we want to be cautious, particularly in light of the state's budget shortfall and Prince George's County clamping down with a hiring freeze," Mr. Roogow said.
County Councilman C. Vernon Gray, D-3rd, noted that the cap "was obviously designed to slow down growth, but the administration did not consider the downturn in the economy would exacerbate it, although there was some testimony to that effect" by homebuilders at the public hearing last fall.
Mr. Gray said he had "a great concern on how our revenue picture will look in the next three years and if we are generating the tax revenues to support our services, the people we hire and the infrastructure that needs building."
Councilwoman Angela Beltram, D-2nd, an advocate of slower growth, said she thinks that the slumping economy is the major factor in the decline in homebuilding. She said the potential reduction in revenues comes at a bad time because the suburban county is "trying to catch up on constructing roads and schools."
"The slowdown does give us more time to plan, but I am concerned about what services to cut, what needed programs won't be added or whether we face a tax hike and I don't want to do that," she said.
John Liparini, president of the Howard County Home Builders Association, said he considered the cap on residential growth to be "disastrous." He added that "nobody is building now, and nationwide homebuilding is down 30 to 40 percent."
"Our local homebuilding association membership has been pared down dramatically the last 12 months -- a number of them moved out of the county or went out of business. Those that are still here are just hanging on," he said.
Mr. Roogow, however, noted that the housing cap has achieved the county's goal of "giving us a breathing space" to develop a new General Plan for growth and pending legislation that would limit growth in areas where roads and schools are overburdened.