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T. Page 98 Land Use Law Report June 18, 2003 Vested Rights Rezoning Gave Developer Right To Complete Phased Project The Virginia Supreme Court has ruled a 1988 rezoning gave a developer a vested right to com- plete construction of a planned unit development under the zoning established by the rezoning, not- withstanding any subsequent zoning change (City of Suffolk v. Board of Zoning Appeals for.-the City of Suffolk, No. 021981, June 6, 2003). The case was the court's first opportunity to interpret a 1998 law that changed the criteria for vesting of development rights. In 1985, Etheridge Manor Corp. (Etheridge) bought a 164 -acre parcel in Suffolk. In 1988, the city rezoned the Etheridge property and the land of an adjoining landowner from rural residential to planned development housing. It also approved a master land -use plan for the development. The plan called for a mixed -use mixed density project in- cluding medium- and high - density residential de- velopment and commercial uses. The adjoining landowner fell into financial dif- ficulties which delayed the joint development. Etheridge decided to proceed alone. In 1994, the city approved Etheridge's request to rezone 10 acres of its parcel to general business and changed the proposed residential development to low den- sity. New Zoning Ordinance Enacted In 1996, Etheridge submitted a preliminary subdivision plan for part of the remaining 154 acres. It filed a final plan in 1998. No action was taken on that plan before the city enacted a new development ordinance in 1999. That ordinance changed the zoning of the 154 acres to "commerce park" and "office - institutional." The zoning ad- ministrator determined Etheridge had vested rights in the 10 -acre general business parcel, but not in the rest of the land. The board of zoning appeals reversed, finding Etheridge had vested rights in the original zoning of the 154 acres. The trial court af- firmed the board's determination. The city ap- pealed. The supreme court noted that before 1998, its cases had held landowners generally had no vested property right in the continuation of a particular zoning status, except under limited circumstances. In that year, the legislature passed a law setting criteria that, if satisfied, conclusively vest property rights regardless of subsequent zoning changes. It provides that a landowner's rights are deemed vested if the landowner obtains a significant af- firmative governmental act allowing development of a specific project; the landowner relies in good faith on that act, and incurs extensive obligations or expense in diligently pursuing the specific project. The city conceded the 1988 rezoning was. a significant governmental act, but argued it was not for development of a specific project. It relied on two cases decided before the 1998 legislation was passed to support its argument that detailed devel- opment plans are required before a property owner can obtain vested rights. However, the court said, the plain language of the 1998 law makes it clear that vested rights occur when any one of the six types of actions listed occurs. The court rejected the city's contention that a "specific project" can be found only where the de- veloper has filed a site plan for the entire property. No such requirement existed in the statute, it said. The board of zoning appeals and the trial court both recognized that the object of the 1988 rezoning was a specific tract. The master land -use plans filed es- tablished the highway entrances, the general road plan and recreation areas, as well as the areas des- ignated residential and commercial. That supported the implied conclusion of the trial court and the board that the rezoning was directed to a specific project. Developer Worked Diligently The city also argued Etheridge had not dili- gently pursued the project, pointing out little was done between 1988 and 1994. However, that was not relevant because Etheridge did proceed dili- gently between 1993 and 1999, when the new zon- ing ordinance was adopted. During this time, Etheridge spent over $158,000 in developing the property. The city argued those expenditures were for the already approved a portion of the development, but the uncontradicted testimony of Etheridge's engi- neer established that the infrastructure put in place was well in excess of the needs of the approved development, and was intended to serve the entire property. The court's opinion is available from BPPs DocuDial service, No. 39 -4826, 24 p. Land Use Law Report welcomes readers' com- ments, questions and suggestions. You can reach the editor, James D. Lawlor, by mail at Business Publishers, Inc., 8737 Colesville Rd., #1100, Silver Spring, MD 20910 -3928, by telephone at (301) 649 -5872, or via e -mail, land - law@boo.net. © 2003 Business Publishers, Inc. All rights reserved.