This message has been cross posted to the following Discussion Forums: Small Project Practitioners and Residential Knowledge Community .
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August Caringi AIA
Clinton Township MI
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Many owners or project developers think that architects, contractors and even suppliers should help them finance their projects. They can and do stretch out the payment of the architect's fees but they cannot do the same when it comes to the payment of permit fees. We all know full well that building departments insist on the payment of all fees UP FRONT or you don't get the permit. Also, many municipalities have added a new wrinkle called a "Performance Guarantee" that is in the form of cash, bond or irrevocable letter of credit and is also required to be provided UP FRONT. Even though this item is returned if all goes well the total expenditure of permit fees and other financial requirements is considerable.
Architects should stay out of this part of the process. If an owner or project developer has trouble paying the known "out-of-pocket" project costs in a timely way they probably should review the financial feasibility of the whole project investment. ----------------------