When I lived in Pennsylvania, I had a ton of private clients that hired me to oversee new construction in the Poconos. People from NY & NJ were getting homes built in the Poconos but did not live nearby. They had trust issues even though the houses were being built under permit.
My experience was that the local code inspectors were simply not doing their jobs. There was no nitpicking; these were some blatant violations in framing and every other discipline, with electrical being one of the better trades. There were times I made an appointment with the local building official just to sit down and go over these issues; however, most of the time, the BO was the inspector, so some awkward moments ensued.
In one instance there was a situation where a development involved 2 different municipalities. One side of the street was one muni and the other was another. It was the same developer and same homebuilder. What was unbelievable was that because there were two different munis, the homebuilder built completely different based on what side of the street he was on. Because one of the BOs was so incompetent, the builder got away with whatever he could. No house wrap, window with zero flashing, no insulation in the basement, etc. On the other side of the street, the homes were built to code because they had a relatively competent BO. An attorney got involved, I then inspected 5 recently finished homes on the bad side and then a neighbor on the good side allowed me to inspect their home as a control/comparison. This is where we discovered that the builder was getting away with whatever he could.
In the case above, PA L&I got involved and we worked together to verify all of my reports. They notified the incompetent BO that he should hire an attorney because they were going to revoke his certifications.
So this does happen. There are those that take their job seriously and realize what is at stake and ensure the the minimum codes are adhered to per state statute and local ordinances and there are those that just want to be the nice guy/girl and go out of their way to find an excuse as to why something is not required and there are those that are simply incompetent and sucking money from the system. In the case of Boise, ID, sounds like the muni itself never took the BD seriously. How many other homes had these issues?