Planning Advisor July 2008

MRSC FOCUS › Planning Advisor July 2008

MRSC has joined with Phil Olbrechts, Attorney, Ogden Murphy Wallace, Pat Dugan, Dugan Consulting Services, Arthur Sullivan, Program Manager of ARCH (A Regional Coalition for Housing), and Anindita Mitra, founder of CREÄ Affiliates, LLC, to bring you the "Planning Advisor" article series on planning and growth management issue affecting Washington Local Governments. The "Planning Advisor" will feature a new article each month with timely information and advice you can use.*

Can’t Always Trust those RCW’s: The Problems with Mandatory Pre-Application Conferences

July 2008

Phil Olbrechts, Attorney
Ogden Murphy Wallace, PLLC

“But the RCW ⁽¹⁾ allows mandatory pre-application meetings!” — That’s what I always hear when I point out the problems of mandatory pre-application conferences. RCW 36.70B.060(2) does state that nothing in the Regulatory Reform Act prevents a local government from requiring a pre-application conference. Well it should. pre-application conferences give both the applicant and staff an opportunity to roadmap a hassle-free permitting process (one can always hope). However, there is a constitutional doctrine, the vested rights doctrine, that trumps the wisdom of the state legislature in its adoption of RCW 36.70B.160(2). That doctrine could very well invalidate your pre-application ordinance or move vesting of the permit to the date of the conference or even before. Fear not! The Planning Advisor, i.e., this article, has some suggestions for addressing the situation.

The Problem

The “problem” here is that vested rights doctrine. For the uninitiated, this is the “bright line rule” established by our state supreme court in 1958 ⁽²⁾ designed to give a break to applicants “in order to provide a measure of certainty to developers, and to protect their expectations against fluctuating land use policies.” ⁽³⁾ Once an applicant files a complete building permit application that is consistent with applicable development regulations, any new development standards subsequently adopted by the city or county generally don’t apply — the developer has “vested” his application under the regulations in place at the time the complete application was submitted. In layperson’s parlance, the developer “grandfathers” a complete application upon submission.

Since the 1958 decision, the appellate courts have extended the vested rights doctrine beyond building permits to conditional use permits, grading permits, septic tank permits, and shoreline permits. The legal authority used by the state supreme court in formulating the vested rights doctrine is the Fourteenth Amendment, the due process clause. The court has determined that the vested rights doctrine is supported by “notions of fundamental fairness” and will invalidate on the basis of due process ordinances that attempt to preempt the doctrine. ⁽⁴⁾ The constitutional basis of the vested rights doctrine is significant, because the state legislature also can’t adopt any legislation that violates the due process clause, including RCW 36.70B.160(2).

At this point, some of you are thinking “ok, what does a pre-application conference have to do with the vested rights doctrine?” The fundamental problem with a pre-application conference is that it robs the applicant of the ability to control the date of vesting, undermining the vested right’s purpose of protecting against “fluctuating land use policies.” A pre-application conference gives a community notice and an opportunity to change the rules to prevent a development it doesn’t want. If, through an oversight, Bellevue’s zoning code authorized slaughterhouses adjacent to Newport Shores, you can bet that as soon as the request for a pre-application conference comes in for the slaughterhouse development the Bellevue City Council will be holding a special meeting to adopt an immediate moratorium or interim ordinance banning slaughterhouses. For these reasons, the courts have ruled that the vested rights doctrine includes the applicant’s right to control the date of vesting.

There are two key cases that address the issue of control over the vesting date. The most pertinent is West Main v. Bellevue. ⁽⁵⁾ In that case, the City of Bellevue adopted an ordinance requiring a developer to go through several procedural obstacles prior to filing a building permit application, including administrative design review approval, site plan review approval, and administrative conditional use approval. The ordinance further provided that the filing of applications for any of these preliminary approvals would not vest development rights — this would only occur upon the filing of the building permit application. The developer challenged the validity of the ordinance. The court agreed that the ordinance violated due process and was invalid, concluding as follows:

The City delays the vesting point until well after a developer first applies for City approval of a project, and reserves for itself the almost unfettered ability to change its ordinances in response to our vesting doctrine’s protection of a citizen’s constitutional right to develop property free of the “fluctuating policy” of legislative bodies. ⁽⁶⁾

Of more general relevance is the case of Erickson & Associates v. Seattle. ⁽⁷⁾ A developer challenged a Seattle vesting ordinance, which provided that a project vested either upon the filing of a complete building permit application or when the city earlier issues a master use permit. As noted by the court, the master use permitting process was an “iterative” process in which developers may start off with general design concepts and then refine them as they work with staff. The vesting ordinance gave applicants the ability to file a building permit application at any time to vest their projects and the timing of the building permit application was not dependent upon the master use review process. The developer asserted the vesting ordinance violated the vested rights doctrine because it only provided for vesting upon the issuance of a master use permit as opposed to the filing of an application for one. The court upheld the validity of the ordinance, finding it determinative that applicants could control the time of vesting by filing a building permit at any time.

Mandatory pre-application conferences are certainly distinguishable from the West Main case as a matter of degree — in the West Main case the city of Bellevue had almost limitless discretion to delay vesting. Most pre-application conference requirements require cities and counties to hold the conferences within some reasonable amount of time. In formulating the vested rights doctrine, the courts were careful to require a “complete” permit application in order to only protect developers who have backed their development expectations with some investment, which isn’t happening much at the pre-application stage. The fact remains, though, that a pre-application conference gives a city or county both notice and opportunity to change the rules prior to vesting, taking away the control an applicant has to set vesting date as found so important in Erickson. The similarities between the master use process in Seattle and pre-application conferences also don’t help — both focus upon a preliminary conceptual review designed to streamline the permitting process.

Attorneys differ as to the consequences of the intersection of the vested rights doctrine with the pre-application statute, RCW 36.70B.060(2). Some ⁽⁸⁾ look to the remedy of the West Main case and the remedy usually associated with due process violations and believe that mandatory pre-application conferences are invalid. Others believe that a court would try to harmonize statutory vesting statutes (the legislature has codified vesting for some development permits, including building permits) with the pre-application statute and the vested rights doctrine to move up vesting to the date of the pre-application conference, or possibly the date a pre-application conference is requested.

The Solution

There are at least a couple strategies a municipality could employ to deal with the vesting problems of mandatory pre-application conferences. One, just don’t make the conferences mandatory. Provide incentives for attending optional conferences. This could include lower permit application fees for those who choose to attend. Also, make applicants pay for time wasted because they didn’t attend a pre-application conference — additional review fees can be imposed for project modifications necessitated by noncompliance with development standards.

A second suggestion — allow vesting to occur when a complete request for a pre-application is filed but only allow the vesting to perfect if a complete application is filed within a set number of days. This retains the developer's control over the vesting date while protecting the city or county from the speculative vesting of permits. For example, your code could provide that a project will vest upon the submittal of a complete request for a pre-application conference if a complete development permit application is filed within 21 days of the date of the pre-application request or seven days from the end of the pre-application conference, whichever is later. You could also set 20 percent of the development permit fee as the pre-application conference fee and provide that it will be applied to the development permit application if a complete development permit application is made within the requisite time. If a complete application isn’t filed within the requisite time, the applicant forfeits the 20 percent fee.

In short, yes, RCW 36.70B.060 does recognize the authority to mandate pre-application conferences. It’s just going to take a little creativity if your community wants to take advantage of that authority.

¹ RCW” is the “Revised Code of Washington”, the codification of the state statutes adopted by the Washington State Legislature.

² Hull v. Hunt, 53 Wn.2d 125 (1958).

³ Friends of the Law v. King County, 123 Wn.2d 518, 522 (1994).

⁴ See West Main Associates v. Bellevue, 106 Wn.2d 47, 51 (1986).

⁵ Id.

⁶ Id.At 52.

⁷ 123 Wn.2d 864(1994).

⁸ Well ok, the disagreement is between me an attorney who chooses to remain anonymous and has absolutely nothing to do with this article.

Pat Dugan has a unique combination of experience in both planning and public finance, spanning 35 years. As a planner, he has been a planning director in two cities (Auburn and Burien), and two regional planning agencies in Oregon and Washington; and was a planning manager in Goleta, California. In public finance, Pat has served as the chief financial officer in four public agencies including the Cities of Auburn and Lynnwood, and the Snohomish County Public Works Department. He has written extensively on financing capital facility programs and on public finance for planners. Pat now offers planning and public finance consulting services and in his own firm, Dugan Consulting Services in Everett and can be reached at consult.dugan@verizon.net.

Anindita Mitra, AICP is the Founder of CREÄ Affiliates, LLC a planning and urban design consultancy that focuses on creating awareness of unsustainable practices, and offers a platform for affected parties to openly communicate and collaborate to arrive at creative sustainable solutions. She is also one of the Co-Chairs of the Climate and Sustainability Initiative of the Washington Chapter of the American Planning Association. Anindita's current interests include the development of sustainable master plans and streetscape designs; establishing sustainable community indicators and their integration into comprehensive plans and governance; identifying creative solutions directing communities towards energy-independence; preparing communities for the challenges potentially brought upon by the Climate Change phenomenon; and advancing the integration of transit and non-motorized travel solutions into community land use planning. She has worked throughout the United States for both the public and private sectors.

Phil Olbrechts is a member (similar to partner) and elected member of the board of directors of Ogden, Murphy, Wallace, LLC. Phil focuses his practice on land use law and currently represents seven municipalities as either City Attorney or Hearing Examiner. He has taught over a dozen credits of land use law at the University of Washington, has taught numerous land use continuing legal education courses and has made over 200 land use presentations to elected and appointed officials throughout Washington State. Phil has served on the Seattle Planning Commission and in the past served as the Planning Director for two municipalities.

Arthur Sullivan is the Program Manager of ARCH (A Regional Coalition for Housing). ARCH is a coalition of 16 public jurisdictions located in East King County. Its purpose is to facilitate efforts of public jurisdictions to create a full range of housing, with an emphasis on affordable housing. In 2004 ARCH was the winner of the inaugural Ash Institute / Fannie Mae Foundation Innovations in American Government Award in Affordable Housing. Previously Arthur was a Senior Manager at BRIDGE Housing and planner for Environmental Impact Planning. He holds a B.A. in Planning from the University of Washington, and a Master of Planning from UC, Berkeley.

*The Articles appearing in the "Planning Advisor" column represent the opinions of the authors and do not necessarily reflect those of the Municipal Research & Services Center.