Funding Mechanisms for Information Technology

State and local governments have successfully used two different major funding mechanisms for acquisition and implementation of software and hardware in their building regulatory processes.

The contact persons listed for the jurisdictions in the above database are prepared to share with their colleagues in other jurisdictions details regarding how they went about funding their programs.

The chart below describes those two approaches:

How Is I.T. Funded?

The two most popular ways of funding the acquisition of information technology to support the enforcement of codes are:

There are pros and cons to both approaches:

Surcharge on Fee for Service – Dedicated Fund



Funds cannot be used for any other purpose.

In times of low construction volume, there may not be adequate funding to cover both I.T. acquisition and operating budget of code enforcement program.


Mixed – Surcharge Fee for Service + General Fund



Greater flexibility when construction volume is low.

In times of economic shortfalls, operating revenues of code enforcement agency including I.T. funding might be used for other needs, thereby reducing level of protection to public.

In addition to the above, in recent years some states and localities have issued bonds to fund the acquisition of information technology for their jurisdiction. These bonds have largely been used at the state level and cover information technology acquisition for multiple state governmental agencies including state building code operations. Kentucky recently received bonding authority for its building code department’s acquisition of I.T. to cover licensing of electrical contractors. (For information on Kentucky’s program, contact Building Commissioner Dennis Langford, Frank Dempsey, or Suzanne Long at 502 573-0365 or

Additional useful information on electronic permitting systems can be obtained by reviewing a copy of the U. S. Department of Housing and Urban Development Office of Policy Development and Research, 2002 report on Electronic Permitting Systems and How to Implement Them.

The report was prepared for HUD by Alliance Partner, National Institute of Building Sciences.