Barring an 11th hour agreement with the federal regulators, the city of Cape Coral will no longer be able to unilaterally review and issue permits for building on canals or docks as of the end of business Friday.

In a turn of events that surprised the city and those in the construction industry, the Army Corp of Engineers denied an extension to the city to continue to issue building permits in areas sensitive to the threatened smalltooth sawfish.

The agency gave the city less than 72 hours notice of its decision, which means permits for such things as new or replacement sea walls will have to be submitted to the city, which then will have to forward them for federal review. This will turn the current two- to three-day turnaround for permits into a process that could take as long as six months, city officials said.

The Corps had hoped to administratively extend the permit approved five years ago while it continued efforts with another federal agency, according to an e-mail to the city sent by Tunis W. McElwain, chief, Fort Myers Section Regulatory Division of the ACE. The Corp can not extend permit because it does not have an existing Biological Opinion from the National Marine Fisheries Service for the previous issuance of permit, he informed the city.

The Corps will have to review any applications that would have been authorized under the permit, SAJ-91, until “formal consultation can be concluded for smalltooth sawfish critical habitat,” the e-mail states.

The city had been working under a five-year agreement with the Corps where the city is allowed to issue and accept permits for seawalls, which are required if anything is to be built on canal-front sites.

City spokesperson Connie Barron said details are still sketchy, and therefore couldn’t get into specifics, but said the city had anticipated getting the extension and was “thrown a curveball” when it didn’t get it.

“This has been going on for a long time. We’ve been working to resolve this issue,” Barron said.

Heather Mazurkiewicz, executive director of the Cape Coral Construction Industry Association, said the news was an unpleasant surprise, seeing as a few months ago she thought an extension was imminent.

“Three months ago, the ACE stated it would extend the permit past Oct. 12 because we were working on a solution,” Mazurkiewicz said. “You could imagine the shock when I got the e-mail Wednesday saying ‘No.'”

Councilmember Marty McClain said the biological opinion was the key to get the extension done.

“A biological opinion was made when the permit was issued, and a 45-day extension is required while the opinion is being redrafted,” McClain said.”The National Marine Fisheries didn’t pursue the process to see if they could extend it.”

Mazurkewicz said a months-long delay in the permitting process could be devastating to homebuilding at a time when the industry was finally picking up steam.

“When you have a city with 400 miles of canals, pre-platted into 80-by-120 lots, having the process halted on Monday and adding 120 days to six months will be devastating on the construction industry and have a ripple-down effect on the real estate market,” Mazurkiewicz said.

David Mulicka, owner of Honc Marine Contracting and past CCCIA president, said the decision will have ramifications beyond just seawalls.

“Homeowners need know this involves repair and replacement of seawalls, docks, lifts, dredging and repair,” Mulicka said. “If a seawall is in disrepair and it takes a year for the permit and the wall fails, the liability is with the homeowner.

“Cape Coral is in a financial recovery and the last thing we need is a permitting issue that stops construction,” Mulicka said.

Mazurkiewicz said the target review time for the ACE is 120 days, which is reached 70 percent of the time. But when the city had a similar situation with the manatees several years ago, the process took as long as 18 months.

“It’s the same as the manatees. That’s what this is based on,” Mazurkiewicz said.

McClain said nobody is to blame on the city or state level.

“We learned about this a year ago and became proactive about extending the permit,” McClain said. “I have to commend the state reps and their involvement in this. We have a barrier between us and the federal government. An apology from the ACE won’t carry much weight.”

The smalltooth sawfish is a species found in shallow tropical and subtropical waters in coastal parts of the Atlantic and Gulf of Mexico. Locally, it swims in the shallow canals.

It is vulnerable to overexploitation because of its propensity for entanglement in nets, its restricted habitat, and low rate of population growth, according to the NOAA.

There are more than 840,000 acres of sawfish habitat in Southwest Florida according to the NOAA.