The American Rescue Plan’s potential impact on permitting

Now in the 54th week of a two-week pivot to remote work, time spent at home has led to increasing renovation desires to suit changing needs. The Residential Remodeling Index predicts an upward trend in professional-worthy remodeling projects (more than $1,000) and the National Kitchen & Bath Association’s 2021 Design Trends Research report forecasts larger renovations to accommodate for pandemic-related lifestyle changes. While Discover Bank found that at least 53 percent of homeowners have intentions to renovate, 49 percent are delaying projects due to financial constraints. The American Rescue Plan’s individual economic assistance through recovery rebates (i.e., stimulus checks) to many American taxpayers could help spur the investment for the projects.

For commercial construction, permitting activity could spike as the Coronavirus State and Local Fiscal Recovery Funds (FRF) pumps $350 billion into state, tribe, territory and local governments of all sizes, which will likely be used for some infrastructure improvements. Smaller cities left out of the last relief package, like Del Mar, Calif., report plans to spend part of its FRF share on revitalizing capital improvement and infrastructure projects that were paused due to the COVID financial crisis. Additionally, of the $350 billion, $10 billion is set aside specifically for capital improvement and large infrastructure projects.

In addition to the FRF, the Small Business Administration’s start-up loans and restaurant revitalization grants may be used towards construction to alter retail environments or create new outdoor spaces. The federal government’s Paycheck Protection Program, which provides potentially forgivable payroll loans to businesses and non-profits with less than 300 employees, may help direct funding to ensure both companies seeking to make improvements and construction companies stay afloat. Other areas within the American Rescue Plan that may drive development include $500 million towards the construction of state veterans homes, $10 million in technical assistance for tribal housing projects, $39.6 billion to higher education institutions that includes support to defray costs for classroom retrofits, and $50 billion to the Federal Emergency Management Agency’s (FEMA) Disaster Relief Fund for any fiscal year 2021 major disaster declarations.