Reston 20/20 Letter to Governor McAuliffe Proposing Amendments to General Assembly Proffer Restrictions Bills

The following letter is Reston 20/20's response to the General Assembly's legislation to limit local governments ability to negotiate proffers for new development as presented here on Reston 20/20's blog.

   Ltr to Governor McAuliffe Re Proffer Restrictions

Developers buy General Assembly vote to limit residential development proffers.

In a matter of a few very short, very quiet weeks early in this session, both houses of the Virginia General Assembly have passed by large margins slightly different versions of a bill that would limit the role of developer proffers in offsetting the massive impact their residential development will have on transportation, schools, parks, the environment, and more.  It may not affect development of FAR 4.0 or more around Metro stations.  While the bill language still needs to be resolved between the two houses, there is little doubt that the bill will be sent to the Governor within days.

Just for the record:

• Dick Saslaw, a Fairfax County Democratic Senator, was a CO-SPONSOR of the bill in the Senate and voted FOR it.
• Janet Howell, Reston's state senator, voted FOR the bill.
• Ken Plum, Reston's state delegate, voted FOR the bill.

You can see how little our representatives think about their constituents and the impact of developer profiteering by shifting the huge infrastructure cost load--$2.6 billion in Reston station area streets alone--to local taxpayers.

Here is the lede on the most recent news report about this bill:

Forty years ago, when development was booming Fairfax County, government leaders at the Massey Building had an idea: Create a system to make demands on builders so they would have to pay for traffic improvements and sewer upgrades. Over time, though, that system expanded and developers started offering things themselves, such as providing computers to local schools or forking over cash to an affordable housing fund. 

The problem, some Virginia lawmakers say, is that the costs of those proffers — a system that was institutionalized statewide in the late 1970s — are often passed on to homebuyers. And business leaders say the system represents little more than extortion, hitting businesses for uniform cash contributions regardless of a project's size. . . .

Yet it provides absolutely no justification for why existing homeowners should pay for the needed improvements caused by the building of new residences.

Here is the language of the Senate bill passed this morning:

SENATE BILL NO. 549 FLOOR AMENDMENT IN THE NATURE OF A SUBSTITUTE (Proposed by Senator Obenshain on February 5, 2016)

A BILL to amend the Code of Virginia by adding a section numbered 15.2-2303.4, relating to conditional zoning.

Be it enacted by the General Assembly of Virginia:

1. That the Code of Virginia is amended by adding a section numbered 15.2-2303.4 as follows:

§ 15.2-2303.4. Provisions applicable to certain conditional rezoning proffers.

A. For purposes of this section, unless the context requires a different meaning:

"New residential development" means any construction or building expansion on residentially zoned property, including a residential component of a mixed-use development, that results in either one or more additional residential dwelling units or, otherwise, fewer residential dwelling units, beyond what may be permitted by right under the then-existing zoning of the property, when such new residential development requires a rezoning or proffer condition amendment.

"New residential use" means any use of residentially zoned property that requires a rezoning or proffer condition amendment.

"Offsite proffer" means a proffer addressing an impact outside the boundaries of the property to be developed and shall include all cash proffers.

"Onsite proffer" means a proffer addressing an impact within the boundaries of the property to be developed and shall not include any cash proffers.

"Proffer condition amendment" means an amendment to an existing proffer statement applicable to a property or properties.

"Public facilities" means public transportation facilities, public safety facilities, public school facilities, or public parks.

"Public facility improvement" means an offsite public transportation facility improvement, a public safety facility improvement, a public school facility improvement, or an improvement to or construction of a public park. No public facility improvement shall include any operating expense of an existing public facility, such as ordinary maintenance or repair, or any capital improvement to an existing public facility, such as a renovation or technology upgrade, that does not expand the capacity of such facility.

"Public safety facility improvement" means construction of new law-enforcement, fire, emergency medical, and rescue facilities or expansion of existing public safety facilities, to include all buildings, structures, parking, and other costs directly related thereto.

"Public school facility improvement" means construction of new primary and secondary public schools or expansion of existing primary and secondary public schools, to include all buildings, structures, parking, and other costs directly related thereto.

"Public transportation facility improvement" means (i) construction of new roads; (ii) improvement or expansion of existing roads and related appurtenances as required by applicable standards of the Virginia Department of Transportation, or the applicable standards of a locality; and (iii) construction, improvement, or expansion of buildings, structures, parking, and other facilities directly related to transit.

"Residentially zoned property" means property zoned or proposed to be zoned for either single-family or multifamily housing.

B. Notwithstanding any other provision of law, general or special, no locality shall (i) request or accept any unreasonable proffer, as described in subsection C, in connection with a rezoning or a proffer condition amendment as a condition of approval of a new residential development or new residential use or (ii) deny any rezoning application or proffer condition amendment for a new residential development or new residential use where such denial is based in whole or in part on an applicant's failure or refusal to submit, or remain subject to, an unreasonable proffer.

C. Notwithstanding any other provision of law, general or special, (i) as used in this chapter, a proffer, or proffer condition amendment, whether onsite or offsite, offered voluntarily pursuant to § 15.2-2297, 15.2-2298, 15.2-2303, or 15.2-2303.1, shall be deemed unreasonable unless it addresses an impact that is specifically attributable to a proposed new residential development or other new residential use applied for and (ii) an offsite proffer shall be deemed unreasonable pursuant to subdivision (i) unless it addresses an impact to an offsite public facility, such that (a) the new residential development or new residential use creates a need, or an identifiable portion of a need, for one or more public facility improvements in excess of existing public facility capacity at the time of the rezoning or proffer condition amendment and (b) each such new residential development or new residential use applied for receives a direct and material benefit from a proffer made with respect to any such public facility improvements.

D. Notwithstanding any other provision of law, general or special:

1. Actions brought to contest the action of a locality in violation of this section shall be brought only by the aggrieved applicant or the owner of the property subject to a rezoning or proffer condition amendment pursuant to subsection F of § 15.2-2285.

2. In any action in which a locality has denied a rezoning or an amendment to an existing proffer and the aggrieved applicant proves by a preponderance of the evidence that it refused or failed to submit or remain subject to an unreasonable proffer that it has proven was suggested, requested, or required, formally or informally, by the locality, the court shall presume, absent clear and convincing evidence to the contrary, that such refusal or failure was the controlling basis for the denial.

3. In any successful action brought pursuant to this section contesting an action of a locality in violation of this section, the applicant may be entitled to an award of reasonable attorney fees and costs as well as compensatory damages and to an order remanding the matter to the governing body with a direction to approve the rezoning or proffer condition amendment without the inclusion of any unreasonable proffer. If the locality fails or refuses to approve the rezoning or proffer condition amendment within a reasonable time not to exceed 90 days from the date of the court's order to do so, the court shall enjoin the locality from interfering with the use of the property as applied for without the unreasonable proffer. Upon remand to the local governing body pursuant to this subsection, the requirements of § 15.2-2204 shall not apply.

E. The provisions of this section shall not apply to any new residential development or new residential use occurring in an approved area comprehensive plan that allows a density of at least 4.0 floor area ratio in a portion of a revitalization area that encompasses mass transit as defined in § 33.2-100 and mixed use development or in such a plan that allows additional density within one-quarter mile of an existing or planned Metrorail station or an approved area of a service district created pursuant to § 15.2-2400 which area encompasses an existing or planned Metrorail station.

2. That this act shall not be construed to affect any proffer related to a nonresidential development or use and shall be construed as supplementary to any existing provisions limiting or curtailing proffers or proffer condition amendments for new residential development or new residential use that are consistent with its terms, and shall be construed to supersede any existing statutory provision with respect to proffers or proffer condition amendments for new residential development or new residential use that are inconsistent with its terms.

3. That this act is prospective only and shall not be construed to apply to any proffer accepted prior to the date of enactment or to any proffer condition amendment amending a proffer accepted prior to such date.

Here is the House version of the bill passed last week:

  HOUSE BILL NO. 770

AMENDMENT IN THE NATURE OF A SUBSTITUTE (Proposed by the House Committee on Counties, Cities and Towns) (Patron Prior to Substitute--Delegate Gilbert) House Amendments in [ ] -- February 3, 2016

A BILL to amend the Code of Virginia by adding sections numbered 15.2-2303.4 and 15.2-2303.5, relating to conditional zoning.

Be it enacted by the General Assembly of Virginia:

1. That the Code of Virginia is amended by adding sections numbered 15.2-2303.4 and 15.2-2303.5 as follows:

§ 15.2-2303.4. Provisions applicable to all conditional rezoning proffers.

A. For purposes of this section, unless the context requires a different meaning:

"New residential development" means any construction or building expansion on residentially zoned property, including a residential component of a mixed-use development, that results in either one or more additional residential dwelling units or, otherwise, fewer residential dwelling units, beyond what may be permitted by right under the then-existing zoning of the property, when such new residential development requires a rezoning or proffer condition amendment.

"New residential use" means any use of residentially zoned property that requires a rezoning or proffer condition amendment.

"Offsite proffer" means a proffer addressing an impact outside the boundaries of the property to be developed and shall include all cash proffers.

"Onsite proffer" means a proffer addressing an impact within the boundaries of the property to be developed and shall not include any cash proffers.

"Proffer condition amendment" means an amendment to an existing proffer statement applicable to a property or properties.

"Public facilities" means public transportation facilities, public safety facilities, public school facilities, or public parks.

"Public facility improvement" means an offsite public transportation facility improvement, a public safety facility improvement, a public school facility improvement, or an improvement to or construction of a public park. No public facility improvement shall include any operating expense of an existing public facility, such as ordinary maintenance or repair, or any capital improvement to an existing public facility, such as a renovation or technology upgrade, that does not expand the capacity of such facility.

"Public safety facility improvement" means construction of new law-enforcement, fire, emergency medical, and rescue facilities or expansion of existing public safety facilities, to include all buildings, structures, parking, and other costs directly related thereto.

"Public school facility improvement" means construction of new primary and secondary public schools or expansion of existing primary and secondary public schools, to include all buildings, structures, parking, and other costs directly related thereto.

"Public transportation facility improvement" means (i) construction of new roads; (ii) improvement or expansion of existing roads and related appurtenances as required by applicable standards of the Virginia Department of Transportation, or the applicable standards of a locality; and (iii) construction, improvement, or expansion of buildings, structures, parking, and other facilities directly related to transit.

"Residentially zoned property" means property zoned or proposed to be zoned for either single-family or multifamily housing.

B. Notwithstanding any other provision of law, general or special, no locality shall (i) request or accept any unreasonable proffer, as described in subsection C, in connection with a rezoning or a proffer condition amendment as a condition of approval of a new residential development or new residential use or (ii) deny any rezoning application or proffer condition amendment for a new residential development or new residential use where such denial is based in whole or in part on an applicant's failure or refusal to submit, or remain subject to, an unreasonable proffer.

C. Notwithstanding any other provision of law, general or special, (i) as used in this chapter, a proffer, or proffer condition amendment, whether onsite or offsite, offered voluntarily pursuant to § 15.2-2297, 15.2-2298, 15.2-2303, or 15.2-2303.1, shall be deemed unreasonable unless it addresses an impact that is specifically attributable to a proposed new residential development or other new residential use applied for and (ii) an offsite proffer shall be deemed unreasonable pursuant to subdivision (i) unless it addresses an impact to an offsite public facility, such that (a) the new residential development or new residential use creates a need, or an identifiable portion of a need, for one or more public facility improvements in excess of existing public facility capacity at the time of the rezoning or proffer condition amendment and (b) each such new residential development or new residential use applied for receives a direct and material benefit from a proffer made with respect to any such public facility improvements.

D. Notwithstanding any other provision of law, general or special:

1. Actions brought to contest the action of a locality in violation of this section shall be brought only by the aggrieved applicant or the owner of the property subject to a rezoning or proffer condition amendment pursuant to subsection F of § 15.2-2285.

2. In any action in which a locality has denied a rezoning or an amendment to an existing proffer and the aggrieved applicant proves by a preponderance of the evidence that it refused or failed to submit or remain subject to an unreasonable proffer that it has proven was suggested, requested, or required, formally or informally, by the locality, the court shall presume, absent clear and convincing evidence to the contrary, that such refusal or failure was the controlling basis for the denial.

3. In any successful action brought pursuant to this section contesting an action of a locality in violation of this section, the applicant shall be entitled to an award of reasonable attorney fees and costs [ as well as compensatory damages ] and to an order remanding the matter to the governing body with a direction to approve the rezoning or proffer condition amendment without the inclusion of any unreasonable proffer. If the locality fails or refuses to approve the rezoning or proffer condition amendment within a reasonable time not to exceed 90 days from the date of the court's order to do so, the court shall enjoin the locality from interfering with the use of the property as applied for without the unreasonable proffer. Upon remand to the local governing body pursuant to this subsection, the requirements of § 15.2-2204 shall not apply.

E. This section shall not apply to any new residential development or new residential use occurring in an approved area comprehensive plan that allows unlimited density within one-quarter mile of an existing or planned Metrorail station.

§ 15.2-2303.5. Certain conditional rezoning proffers prohibited.

Notwithstanding any provision of subdivision A 3 of § 15.2-2286 or § 36-98, no locality shall impose or require, as part of a rezoning or proffer condition amendment, limitations on or requirements for such matters as building materials, finishes, methods of construction, or design features on a new residential development or new residential use as defined in § 15.2-2303.4 unless such new residential development or new residential use is located within a historic district designated pursuant to § 15.2-2306, a redevelopment or rehabilitation district for which a locality provides an exemption from taxation pursuant to § 58.1-3219.4, or an economic revitalization zone created pursuant to § 15.2-1129.2. In addition, this section shall not apply if the new residential development or new residential use is located within a state-designated or federally designated airport noise attenuation zone, is in close proximity to a military base or large commercial or industrial operation, or is located within a flood zone in which applicable regulations allow for the use of flood-proofing construction methods to minimize the risk of flood-related damages, provided that any such limitation or requirement is specifically directed to flood or noise mitigation, respectively.

2. That this act shall not be construed to effect any proffer related to a nonresidential development or use and shall be construed as supplementary to any existing provisions limiting or curtailing proffers or proffer condition amendments for new residential development or new residential use that are consistent with its terms, and shall be construed to supersede any existing statutory provision with respect to proffers or proffer condition amendments for new residential development or new residential use that are inconsistent with its terms.

3. That this act is prospective only and shall not be construed to apply to any proffer accepted prior to the date of enactment or to any proffer condition amendment amending a proffer accepted prior to such date.

Developers may not have to pay for the burden their development places on Virginia communities, local governments.

Fairfax County state senator Richard Saslaw, a Democrat no less, is co-sponsoring a bill in the Virginia Assembly that would restrict local governments' ability to negotiate proffers with developers to build the infrastructure needed to support that construction according to an article in The Roanoke Times.  Here are some excerpts:

Bills that would limit proffers alarm local governments

Posted: Monday, February 1, 2016 4:06 pm

By Graham Moomaw Richmond Times-Dispatch

RICHMOND — Legislation working its way through the General Assembly would make it more difficult for local governments to force developers to pay for public infrastructure or change building plans, a prospect that has caused alarm among some local officials who fear it could limit sharply their ability to manage growth.

Bills have been introduced in both chambers to dramatically reshape the proffer system, which allows localities to extract cash payments and other concessions from home builders through the residential rezoning process.

The legislation would prohibit localities from making zoning decisions tied to “unreasonable” proffers; virtually eliminate localities’ ability to request changes to building materials or designs through the proffer system; and require more proof that new residents would strain services such as schools, roads or parks.

The legislation is backed by the Home Builders Association of Virginia, which says its aim is to restore fairness to a practice described by critics as “legalized extortion.” . . .

Under the legislation, localities would be able to require proffers only for schools, roads, parks and public-safety facilities such as police and fire stations. Parks were covered through an amendment to the bill, which would prevent localities from attempting to get developers to pay for museums, libraries and community centers.

The proposed law would allow proffers to be used only to cover costs “specifically attributable” to a development project, a higher bar than the “reasonably related” and “roughly proportional” standards currently in use.

“We think those terms are vague and loose and have been defined by the local governments to mean whatever they want them to mean,” Toalson said.

Henrico only uses architectural proffers, but other localities in the Richmond area have cash-proffer policies that bring in revenue to help in responding to growth. . . .

The full article is here.

From our perspective, developers' contributions to the communities in which they build fall far short of the offsetting the impact of their construction.  If they did, in fact, meet the full impact, we would not have congested roads nor overcrowded schools to start with. 

Even more weird from our perspective is why a Democratic Senator from Fairfax County would be sponsoring a bill that would make it more difficult for our financially-challenged County government to generate the revenues needed to make Fairfax a livable county.  Did Saslaw not get the word that Fairfax needs revenues?  Does he not realize that fewer proffers will likely mean higher property tax rates in the county?  Or does he just not care because he is so well financed by the developer community?

Apparently developers are just not making enough money and don't owe their communities anything for the opportunity to make their profits. 

RA Letter to Supervisor Hudgins Proposing RA Receive Proffers from Reston Developers

Reston Patch reports that RA has sent a letter to Supervisor Hudgins "requesting that any cash contributions or recreational proffers made by developers be designated to RA."  The letter

RA Ltr to Hudgins Re Proffers