Land Use at the State Level

North Carolina Local Governments Mulling New Extension of Development Permit "Expiration Dates"

As the economy turned downward in 2008, many developers either opted to or were forced to postpone previously-approved projects throughout the State. This delay concerned the development community writ large that valuable and often couldn’t-do-that-again-if-we-tried approvals would expire before work could take place.

As a result, North Carolina local governments and the North Carolina General Assembly worked together to create the land development boon S.L. 2009-406, known generally as “The Permit Extension Act of 2009.” The 2009 Act provided that the running and the expiration of any time limit for taking action on a development permit would be suspended for the period January 1, 2008 through December 31, 2010. The 2009 Act defines “development approval” to include sketch plans, preliminary plats, subdivision plats, site-specific and phased-development plans, development permits, development agreements, erosion and sedimentation control plans, CAMA permits, water and wastewater permits, nondischarge permits, water quality certifications, and air quality permits, and building permits.

But December 31, 2010 is fast approaching and the economy continues to sputter. Accordingly, this summer, the General Assembly extended for one additional year this tolling period for development approvals. In other words, the January 1, 2008 – December 31, 2010 tolling period has been extended through December 31, 2011. Notably, however, S.L. 2010-177 (we’ll call this the 2010 Act) allows local governments to “opt out” of this additional extension to December 31, 2011. According to one report published the day of this post, specific municipal and county governments are in the midst of weighing their options.

According to the Triangle Business Jorunal, some North Carolina local governments are posied as follows with respect to “opting out” of the re-upping of the 2009 Act’s extension:

• The Raleigh City Council will discuss the issue at its Nov. 16 meeting and decide whether to extend all local government approvals or revisit recently amended site plan and subdivision sunset regulations.

• The Cary Town Council could discuss its options at its regular meeting on Nov. 18.

• Morrisville’s planning and zoning board has recommended that the town opt out of the permit extension, and the council will likely discuss the issue at its business meeting on Nov. 18.

• Apex and Johnston County government leaders are not planning to opt out of the additional one-year extension.

• The Knightdale planning department will present information to the town council at its meeting Nov. 17.

• Wake Forest town commissioners will consider the matter at their meeting Nov. 16.

• In Chapel Hill, Holly Springs, Wake County and Durham County, neither the planning boards nor the elected officials have brought the matter up for discussion and will likely not opt out of the extension.

• Chatham County has scheduled a public hearing on Nov. 15.

• Orange County’s county attorney is drafting a resolution that will likely be presented to the county commissioners at the Dec. 6 or Dec. 14 meeting. The resolution would advise the county to not opt out of the extension for planning and inspection approvals, but it would opt out of the extension for environmental health approvals, such as septic tank permits.

For our space, those holding but sitting on qualifying development permits issued by local governments should pay close attention to this issue.

***UPDATE Nov. 16, 2010 UPDATE***
A first of the local governments has opted out. Last evening, the Chatham County Board of Commissioners voted 5-0 to “opt out” of the new re-upping of the development approval extension through December 31, 2011. Others will follow, we’re sure.

Mike Thelen is a lawyer in Womble Carlyle’s Real Estate Litigation practice group. He regularly represents a wide variety of clients in land use and land development issues, from local governments to businesses, in both state and federal venues throughout North Carolina.

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