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Vested Rights Legislation

Taking the guesswork out of the permit processing game

By: Tom Larson
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Among its priorities for the 2013-14 legislative session, the WRA is seeking legislation to clarify when a property owner’s right to use or develop property in a desired manner is protected or vested from subsequent changes to local land-use regulations, zoning ordinances and permit requirements.

Overview

The concept of “vested rights” recognizes that, at some point in time, it is unfair to change the rules and regulations affecting a property owner’s ability to use or develop his or her property. More specifically, the term “vested rights” refers to the point in time when a property owner’s right to use or develop his or her property is protected from further changes to land-use regulations, such as subdivision regulations, zoning changes or other requirements. 

Wisconsin law currently establishes “vested rights” for changes to both zoning and subdivision regulations. Specifically, current law establishes the following: 

  • Zoning: A property owner’s vested right to a particular zoning classification vests when the property owner applies for a building permit that complies with the applicable regulations. See Lake Bluff Housing Partners v. City of South Milwaukee, 197 Wis. 2d 157 (1995). 
  • Subdivision plats: A property owner’s right to have a proposed subdivision plat evaluated based on current subdivision regulations vests at the time the owner submits a preliminary plat — or final plat if a preliminary plat is required. See Wis. Stat. § 236.11(1)(b). 

In summary, both of these laws recognize that a property owner’s right to use or develop his or her property vests upon submitting an application or permit to the government entity responsible for approving such application or permit.

The problems

Two problems exist with current law. First, a property owner’s vested right to zoning is found in case law, not the state statutes. This is a problem because not all local officials are attorneys and thus are often unaware of legal standards established in case law.

Second, the law is silent as to when a property owner’s rights vest with respect to future changes in other types of development regulations and permit requirements at the local level. While the same rationale applied by courts to zoning changes would seemingly apply to other development regulations and permit requirements, it is not clear how a court would actually rule on such a case. Moreover, it would be expensive and time-consuming to find out. 

Proposed solution

To ensure that the rules related to changes in the development-approval process are known by both permit applicants and permit grantors, the WRA is recommending the passage of legislation to specifically state that any changes to local land-use regulations cannot be applied to permit applications that have been submitted prior to the effective date of those changes. 

Under the legislation, once a property owner submits an application for a building permit or other development-related permit or approval that complies with all applicable local ordinances and regulations, the property owner has a vested right in (a) having the building permit or development-related permit or approval evaluated based on the local ordinances and regulations in place at the time of submission, and (b) building on or developing the property in accordance with the building permit or development-related permit/approval. Any subsequent changes made to local ordinances and regulations are not applicable to the approval of the building permit or other development-related permits and approvals. 

Providing greater certainty in the development-approval process will hopefully reduce unnecessary delays and costs related to both larger economic development projects like industrial parks, commercial/retail centers and residential subdivisions as well as smaller-scale projects like home remodeling. 

For more information on the vested rights legislation, please contact Tom Larson at tlarson@wra.org or at 608-240-8254.

Tom Larson is Vice President of Legal and Public Affairs for the WRA.

Published: March 07, 2013
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