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Controversial vested rights ordinance wins commission approval

Thursday, October 10, 2013 by Elizabeth Pagano

After a slight delay, the city’s new Vested Rights Ordinance, formerly known as the Project Duration Ordinance, is headed to City Council with the unanimous blessing from the Planning Commission. However, it remains controversial.


Council members have already discussed the ordinance in executive session, and are expected to vote on it at their Oct. 17 meeting.


Though the discussion at the Planning Commission was fairly brief, the proposed ordinance did face criticism from McLean & Howard LLP attorney and past Real Estate Council of Austin Chair Jeff Howard, who said that he was “frankly disappointed” in the new ordinance.


“Ask yourself: Would the Legislature go to that trouble, create these vested rights? Would there be so much angst over this state-created animal called a project, if the cities can just waive their home-rule municipality magic wand and cut off those rights at whatever period they want?” said Howard. “Is that really the way the law works?”


Answering his own question, Howard said the concept defied logic and state law, and maintained the new ordinance remained in conflict with Attorney General Greg Abbott’s opinion issued last spring. He said the new ordinance still caused projects to expire earlier than state law would allow.


Despite this assertion, the Planning Commission opted to move forward with the new ordinance, and voted 8-0 in its favor. Commissioner Stephen Oliver was absent.


Faced with pointed questions from Commissioner Brian Roark about how, most likely, RECA would oppose anything other than Abbott’s position, Howard conceded that was a fair point.


In March, Council repealed the Project Duration Ordinance, after an opinion by Abbott that it was in conflict with state law. That began a scramble to codify a new law that addressed vested rights – which are the legal rights of landowners that protect them from being subject to changes in law that would impact development that has already begun.


Planning and Development Review Director Greg Guernsey explained that currently the city’s process for reviewing vested claims is not codified. Guernsey explained that right now that determination is entirely his, and without any process of appealing to Council or the Planning Commission available, though it could be addressed through the court system.


The new ordinance will replace that inscrutable system with one that lays out clear review and evaluation criteria for vested rights claims. The ordinance will also amend project dormancy requirements and create new expiration dates that will allow more time than the previous rules.


One of the new aspects introduced by the proposed ordinance are Council-approved consent agreements. These agreements could allow developers with grandfathered projects to develop new projects that came closer to meeting current standards, with Council approval.


Howard said that the expiration dates were virtually the same as the old rules, aside from the allowances for extensions – three years in the Drinking Water Protection Zone and five in the Desired Development Zone.


“The ordinance doesn’t take into consideration the type of project. It doesn’t take into consideration the size of project. I think it arbitrarily imposes one set of time frames in the Drinking Water Protection Zone and another in the Desired Development Zone,” said Howard. “An apartment project takes the same amount of time whether it’s in the Desired Development  Zone or the Drinking Water Protection Zone. There’s no reason to treat them differently from a project standpoint.”


“I think the time frames, frankly, are arbitrary,” said Howard.

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