AGENDA ITEM 21
June 15,2010
Introduction
MEMORANDUM
TO:
FROM:
County Council
~Michael
Faden, Senior Legislative Attorney
Introduction:
Expedited Bill 38-10, Buildings- Adequate Public Facilities ­
Definitions
SUBJECT:
Expedited Bill 38-10, Buildings- Adequate Public Facilities - Definitions, sponsored by
Council President Floreen, is scheduled to be introduced on June 15, 2010. A public hearing is
tentatively scheduled for June 22, 2010.
Bill 38-10 would redefine the term "existing building" for purposes of implementing the
County's adequate public facilities requirement. The amendment would not require an existing
building to have been occupied during the. preceding 12 months in order to be exempt from a
new adequate public facilities test.
For a discussion of why this change in the law may be advisable, see the letter from
attorneys William Kominers and Cindy Bar on ©5-8.
This packet contains:
Bill 38-10
Legislative Request Report
Letter from attorneys Kominers and Bar
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Expedited Bill No.
38-10
Concerning: Buildings - Adequate Public
Facilities - Definitions
Revised: 5-12-10
Draft No. 1
Introduced:
June 15, 2010
Expires:
December 15, 2011
Enacted: _ _ _ _ _ _ _ _ __
Executive: _ _ _ _ _ _ _ __
Effective: _ _ _ _ _ _ _ __
Sunset Date:
-,N~o~n:..::::e
_ _ _ _ __
Ch. _ _, Laws of Mont. Co. _ __
COUNTY COUNCIL
FOR MONTGOMERY COUNTY, MARYLAND
By: Council President Floreen
AN EXPEDITED ACT
to:
(1)
redefine certain tenns for purposes of the adequate public facilities
(2)
requirement in the building pennit law; and
generally amend the law governing the detennination of adequate public
facilities before a building pennit is issued.
By amending
Montgomery County Code
Chapter 8,
Section 8-30
Boldface
Underlining
[Single boldface brackets]
Double underlining
[[Double boldface brackets]]
* * *
Heading or defined term.
Added to existing law by original bill.
Deletedfrom existing law by original bill.
Added by amendment.
Deletedfrom existing law or the bill by amendment.
Existing law unaffected by bill.
The County Council for Montgomery County, Maryland approves the following Act:
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EXPEDITED BILL
No. 38-10
Sec.
1. Section 8-30 is amended as follows:
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10
8-30.
Purpose; definitions.
*
(b)
*
*
Definitions.
In this Article, the following words and phrases have the
meanings stated unless the context clearly indicates otherwise.
(1)
Development
means proposed work to construct, enlarge, or alter
a building for which a building permit is required.
Development
does not include an addition to, or renovation or replacement of,
an existing building if, as measured under guidelines adopted by
the Planning Board for calculating numbers of vehicle trips and
students:
(A)
occupants of the building would generate fewer than 30
total peak hour vehicle trips; or, if they would generate
more than 30 trips, the total number of trips would not
increase by more than 5; and
(B)
the number of public school students who will live in the
building would not increase by more than 5.
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(3)
*
*
Existing building
means a building that [was standing and) is
substantially [occupied during the 12 months before) intact when
an application for a building permit for renovation.1 replacement,
or reconstruction is filed.
(4)
Renovation
means an interior or exterior alteration that does not
affect a building's footprint.
(5)
Replacement
means demolition or partial demolition of an
existing building and rebuilding that building. A replacement
building may exceed the footprint ofthe previous building.
o
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EXPEDITED BILL
No. 38-10
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Sec. 2.
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*
Expedited Effective Date.
The Council declares that this Act is necessary for the immediate protection of
the public interest. This Act takes effect on the date when it becomes law.
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Approved:
Nancy Floreen, President, County Council
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Date
Approved:
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Isiah Leggett, County Executive
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Date
This is a correct copy o/Council action.
Linda M. Lauer, Clerk ofthe Council
Date
F;\LAW\BILLS\I 038 APF Definitions\1 038 BilLDoc
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LEGISLATIVE REQUEST REPORT
Expedited Bill 38-10
Buildings
-
Adequate Public Facilities
-
Definitions
DESCRIPTION:
Redefines "existing building" in the adequate public facilities
implementation law so that the building need not have been
occupied during the previous 12 months in order to be exempt
from a new adequate public facilities test.
Current law makes reuse of existing spaces more difficult
because it requires a new adequate public facilities test unless
the existing building was actually occupied during the previous
12 months.
To allow existing buildings to be reused without a new
adequate public facilities test if the number of trips generated
or students housed would not substantially increase.
Planning Board, Department of Permitting Services
To be requested
To be requested
To be requested
To be researched
Michael Faden, Senior Legislative Attorney, 240-777-7905
Applies where County subdivision regulations apply.
PROBLEM:
GOALS AND
OBJECTIVES:
COORDINATION:
FISCAL IMPACT:
ECONOMIC
IMPACT:
EVALUATION:
EXPERIENCE
ELSEWHERE:
SOURCE OF
INFORMATION:
APPLICATION
WITHIN
MUNICIPALITIES:
PENALTIES:
Not applicable.
F:\LAw\BILLS\1038 APF Definitions\1038 Lrr,Doc
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Holland
&
Knight
3 Bethesda Metro Center, Suite 800
I
Bethesda, MD 20814
Holland
&
Knight UP
I
www.hklaw.com
I
T 301.654.7800
I
F 301.656.3978
William Kominers
3012156610
wllliam.kominers@hklaw,com
Cynthia M. Bar
3016647606
xindy,bar@hklaw,com
March 4,2010
VIA HAND DELIVERY
The Honorable Nancy Floreen
Montgomery County Council
100 Maryland Avenue
Rockville, MD 20850
Dear Councilmember Floreen:
This letter follows up our conversations about provisions of the Montgomery
County Code that are of concern because of what we believe were unintended
consequences of changes to the PAMRJLATR process in 2007. As expressed when we
spoke, certain provisions of the policy as applied, have serious unintended effects on
businesses and property owners in the County. Specifically, certain provisions of
Chapter 8 of the Code, that require an adequate public facilities review prior to issuance
of a building permit, have a logical disconnect and negative economic impact with
respect to existing buildings in the County. This disconnect will likely result in more and
more serious negative impacts during the current economic downturn, because the
downturn will cause increased vacancies for properties in the County. We hope that you
agree that the application of the current LATRJPAMR policies to vacancies in existing
office buildings and shopping centers needs to
be
changed by the County Council.
The County's adequate public facilities (" APF process works in conjunction with
Section 8-31 of the Montgomery County Code. Section 8-31 requires that the Director
of the Department of Permitting Services may issue a building permit only if the Planning
Board has made a timely determination that public facilities are adequate to serve the
development" encompassed in the permit.
U
)
It
Section 8-30(b)(I) defines "development" as:
Proposed work to construct, enlarge, or alter a building for which a
building permit is required. Development does not include an
addition to, or renovation or replacement of,
an existing building
if,
as measured under guidelines adopted by the Planning Board for
calculating numbers of vehicle trips and students:
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The Honorable Nancy Floreen
March 4,2010
Page 2
(A) occupants of the building would generate fewer than 30 total
peak hour vehicle trips; or, if they would generate more than 30
trips, the total number of trips would not increase by more than 5;
and
(B)
the number of public school students who will live in the
building will not increase by more than 5. (Emphasis added.)
"Existing building" is then defined in Section 8-30(b)(3) as "a building that was standing
and substantially occupied during the 12 months before an application for a building
permit for renovation or reconstruction is filed."
Given this definition language, the issue of concern is what the Planning Board
Staff considers to be an "existing building," and the application of the interpretation of
this provision to real world situations. Our understanding is that the Planning Board
("MCPD") Staff is applying this provision to individual tenants in shopping centers and
to office buildings. For example, where a building permit is required to undertake tenant
fit-out (retail or office) or reconstruct and replace a pad site building (retail) that has been
vacant for over 12 months, the MCPB Staff requires an APF analysis that does not credit
the trips generated by either the specific prior use or by any allowed use.
If not considered an "existing building" by the reviewer, the applicant for a
building permit is required to undergo a full APF review, (1) without credit for the use
that vacated the space and (2) without credit for the possible allowable uses for the space
and upon which the original APF analysis must have been predicated. This is the case
even though such building(s) are counted in "background traffic" under the current
system -- which means that other applicants for new projects must take into account the
existing traffic from these existing (and approved) developments (vacant or not).
This interpretation leads to absurd results.
1.
A tenant moves out of a pad site in a shopping center. The owner and new
tenant wants to demolish the building and replace it with a new building of the same size.
However, finding the tenant, negotiating the lease, and preparing plans for permits takes
more than 12 months. Before the building permit can be issued, MCPB Staff will require
an APF analysis
(P
AMR
and LATR) , without crediting the trips associated with the
earlier use.
2.
In a newly constructed, single tenant office building, the tenant's lease
expires six months before the end of the APF validity period. Finding a new tenant or
tenants (including lease negotiation and plans for fit-out) takes the owner more than 12
months. The building permit for the new fit-out for the entire building now must go
through APF analysis (PAMR and LATR) again -- without credit for the earlier use -­
notwithstanding having just done APF for the original construction.
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The Honorable Nancy Floreen
March 4,2010
Page 3
Building permits for tenant fit-out in office buildings and shopping centers should
not be subject to the 12-month occupancy limitation contained in the Code. If individual
office building or shopping center tenants were required to undergo an APF review and
be subject to PAMR for individual vacancies of more than 12 months, this would have a
very chilling effect on leasing in these properties.
We submit that these longer vacancy situations are very possible in the current
economic climate and that these results are not what the Council intended in the
application of the APF and PAMR provisions to existing properties and businesses. This
application of the APF Ordinance to existing County businesses would be devastating.
Needless to say, the costs in time and dollars that result from undertaking and then
fulfilling the APF requirements, especially PAMR, has a deleterious effect on filling the
vacated spaces. More importantly, we do not believe that the Council intended to
essentially devalue property in the County by stripping it of a component of its "vested"
value after construction when the Council revised the PAMRJLATR process in 2007.
This is certainly a very anti-business measure at a time when the County should instead
be acting to encourage business.
The County Council needs to address this issue. Given the unfair application of
this provision and the current economic climate, it would be appropriate to delete the
requirement that an existing building must be substantially occupied during the preceding
12 months prior to filing a building permit request or undergo a full APF review. Instead,
existing buildings should be treated as exactly that -- existing -- and be able to be used for
any authorized uses without a new APF analysis, even if to do so requires a building
permit. So long as the building area is not expanded, there should be no APF
consequence or impact per se.
We know you remember the Loophole Bill. As passed and applied, it recognized
that re-occupancy or replacement of existing structures made sense. So long as the floor
area did not increase by more than 5000 square feet, a Loophole Property could secure
permits or be totally replaced without new APF study or APF consequences. This
approach was taken in recognition that an owner's expectation of value in property for
which their rights had been "vested" included the ability to re-lease the property without a
re-approval process. (The definition of "development" cited above from Section 8-30,
originally came into the Code, albeit in a different form, as part of the Loophole Bill in
1989. See excerpt of Bill No. 25-89, attached.)
\Ve submit that the current law should recognize that an owner's vested rights in a
building, once constructed, includes an "inchoate" right to the traffic expected to be
generated (and that has been analyzed), based on its size and use. Only modification of
either element (size or intensification of use) should give rise to the need to consider a
new APF review. So long as those elements do not change, building permits should be
issued for the existing space or for a replacement building of equal or lesser size.
Otherwise, a building could continually be at risk of being divested of some or all of its
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The Honorable Nancy Floreen
March 4, 20
to
Page
4
previous APF approval, simply by being vacant for some period, or even by leasing to a
use that generates less traffic than originally expected.
Our understanding is ·that you have been considering language to modify the
current adequate public facilities requirement. One option which has been submitted for
your consideration is to adopt the following language:
(3) Existing building
means a building that was standing and
substantially intact before an application for a building permit for
renovation or reconstruction is filed.
We endorse this language, as we believe it would address the issues and the
unintended consequences which we have described herein. We do, however, suggest
that the language be revised as follows to clearly allow a building to be replaced and
appropriately receive credit in the APF review by the County for square footage that is
already counted
in
background development
(3) Existing building
means a building that was standing and
substantially intact before an application for a building permit for
renovation, replacement or reconstruction is filed.
We would like to have an opportunity to discuss this more fully at your earliest
convenience. Please contact us to set up a time to meet.
Very truly yours,
HOLLAND
&
KNIGHT LLP
bJ~~(~)
William
Kominers
Cynthia
M.
Bar
Enclosures
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