Rhode Island Property Law : Rhode Island Real Estate & Environmental Attorney & Lawyer John Boehnert for Development & Permits in RI

Many real estate developers and property owners got a significant break from the General Assembly late last year, when legislation passed to extend the expiration date of a broad range of governmental permits.

And many don't know it!

And the General Assembly recently improved on that substantial benefit.

And many still don't know it!

Because these measures passed with so little fanfare, many are unaware that hundreds of State permits which would ordinarily have expired get a new lease on life.

The first bill extended these permits until June 30, 2011. The second bill extended them even further, given the continuing economic slump.

The Legislature was concerned that because of  the economic crisis, banks were not lending and many real estate developers and ordinary property owners were in the position of not having sufficient funds to perform under governmental permits that had been issued to them.

Why Action Was Appropriate

The legislation first enacted says it well:

“The general assembly hereby finds that the current economic conditions in the real estate market demonstrate that there is little or no demand for new construction. In addition, the banking crisis has made it extremely difficult for real estate developers to obtain financing for new real estate construction. Currently there are real estate developers who have expended substantial amounts of money to obtain permits and approvals from various local and state agencies. Many of the permits and approvals will expire prior to an improvement in the economy and the financial and banking industries.”

The General Assembly’s first solution was simple and effective. All permits in effect at the time of passage, November 9, 2009, would not expire until June 30, 2011, regardless of what the permit terms say. (See the legislation.)

But in June of this year the General Assembly acted again, as the economy remained in the doldrums and no doubt there was concern that the original extension of permits may not be sufficient.

First, the new  legislation increased the number of permits protected from expiration by providing that it was not limited to permits in effect on November 9, 2009 but also included permits issued after November 9, 2009 and on or before June 30, 2011.

Secondly, the new legislation said that permits in effect on November 9, 2009 "will be recalculated as of July 1, 2011 by adding thereto the number of days between November 9, 2009  and the day on which the permit or approval would otherwise have expired".

This second bill went on to provide that the expiration date of permits issued between November 10, 2009 and June 30, 2011 "will be recalculated as of July 1, 2011 by adding thereto the number of days between the day the permit or approval was issued and the day the permit or approval otherwise would have expired". (See most recent legislation.)

Permits Affected

The legislation extends to permits issued by the Rhode Island Department of Environmental Management, the Rhode Island Coastal Resources Management Council, and by municipalities under subdivision and zoning ordinances. (See DEM’s Emergency Regulations.)

Not just professional developers will benefit from this legislation. For example, if a homeowner has obtained a variance to put an addition on his house, only to find that the local bank will not lend for the project, the homeowner’s permit will remain valid substantially beyond its normal expiration. Hopefully, lenders will then be in a feistier mood and the funds will be flowing.

A Tip of the Hat!

Given how costly it can be to get development permits, this has to be one of the smartest things the General Assembly has done in some time. And they not only did it right once, they actually improved upon it.  A tip of the hat to the folks on Smith Hill for this one!

• Email This
• Print
• Comments
• Trackbacks
• Share Link

In the best of times, it’s hard to find anyone saying anything good about cesspools.

And this is hardly the best of times for cesspools.

Not Much Good To Say

The Rhode Island General Assembly passed legislation in 2007, R.I. Gen. Laws 23-19.15 -1 et seq., ordering the phase out of thousands of cesspools, finding:

•  cesspools are substandard and inadequate for sewage treatment and disposal
•  many cesspools contribute directly to groundwater and surface water contamination
•  wastewater disposed from cesspools contains bacteria, viruses, and other pollutants

Ouch!

Targets

The legislation targets the following cesspools for oblivion:

•         cesspools which have failed
•         cesspools on property where a sewer stub is available
•         cesspools within 200 feet of a public drinking water well or surface water supply
•         cesspools within 200 feet of the inland edge of a shoreline feature bordering tidal water

While no one knows how many cesspools have failed, it has been estimated that of the over 50,000 cesspools in Rhode Island,  approximately 4,000 are estimated to be in the State’s coastal zone.

It is safe to say that this is an issue that will affect a good number of Rhode Islanders.

Phase Out Schedule

The current legislation provides the following schedule for removal of targeted cesspools:

•        failed cesspools-- within one year of discovery or sooner if  an imminent health hazard
•        cesspools on property with a sewer stub-- within one year of sale of the property
•        cesspools within 200 feet of tidal coastal features or a water supply -- January 1, 2013.

These deadlines can be extended for up to five years for undue hardship.

The Department of Environmental Management has promulgated draft regulations to begin the phase out of targeted cesspools, which will go for public hearing on May 27, 2010. (See in particular Rule 53)

Costly Consequences

The consequences of being required to abandon a cesspool are not inconsequential.

Perhaps the best scenario is where a sewer tie in is readily available. That may be relatively cost-effective.

However, if  sewers are not available,  the property owner must install a conventional individual sewage disposal system, the cost of which could run from $10,000 to $15,000. However, if the property is located in a sensitive environmental area, high tech denitrification systems may be required, and that could cost from $20,000 to $30,000.

Recognizing Hardships

The legislation authorized the Department to grant limited waivers, up to five years from statutory deadlines, if the homeowner demonstrates “undue hardship”. The draft regulations define undue hardship as

“having an annual income of less than or equal to eighty percent (80%) of the appropriate household size area median income determined by federal Housing and Urban Development standards for the community within which the cesspool is located.”

While people often think of waterfront property as where the wealthy live, in Rhode Island there are also a lot of people of average means who live within 200 feet of tidal water in cottages and modest homes, many of which may be serviced by cesspools.  

Many of these people may be unable to afford the cost of upgrading to new systems if sewers are not available. And while there are loan programs, these are not available in all communities or in all areas of those communities where the loan programs may exist.

Having talked with the top DEM professional responsible for administering the cesspool phase out program, I am confident the Department recognizes that cost of replacement may be an issue and that it is sensitive to the burden the legislation may impose.

Depending on the experience in implementing the program, it is possible that the definition of undue hardship may have to be revisted by the Department or that the General Assembly may have to reconsider the deadlines it has imposed  by statute. This may be particularly so where systems at issue have not failed.

While there may be few goods things to say about cesspools, there will be far fewer good things to say about politicians who try to force homeowners to close cesspools they can't afford to replace.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

The Director of the Rhode Island Department of Environmental Management has statutory authority to review the decisions of DEM Administrative Adjudication hearing officers pertaining to violations or licenses. (See R.I.Gen. Laws 42-17.7-6.) 

Significant Review Authority

By statute, the Director “may in his or her discretion adopt, modify or reject such findings of fact and/or conclusions of law” by doing so in writing setting forth the rationale for the action.

That is significant authority, as the Director can not only accept or reject the hearing officer’s decision, but the Director may also modify it.

Empowering Hearing Officers

But legislation has been introduced in the House and Senate to remove this power from the Director. (See pending legislation.) This would appear to empower hearing officers, making them  the final decision maker at the Department level, subject to court review.

The legislation on its face gives no hint on the rationale for this change. And it is perhaps too early in the session to know if there is serious support for this pending legislation.

One may wonder if the Rhode Island Supreme Court’s decision in the Champlin’s Marina case influenced this proposed legislation. (Champlin’s Realty Associates v. Michael Tikoian et al.) 

In that decision, the Court limited the ability of administrative hearing decisions to be made on anything but evidence presented at a hearing and subject to cross-examination. As the Court said, quoting from its prior decision in Arnold v. Libel:

 “no litigious facts should reach the decision maker off the record in an administrative hearing” and if the decision maker “intends to consult any documentary source or person concerning facts or opinions about the merits of an appeal”, he or she must notify the parties so that they may “contest any such evidence” and “cross-examine any people consulted”.

The Long Arm of the Champlin’s Decision

Perhaps the Champlin’s decision had nothing to do with the pending legislation, but it seems clear that the Champlin’s decision would in any event impose some restrictions on the Director in reviewing hearing officer decisions.

Of course, by statute, the Director “shall have no communication, directly or indirectly, with a hearing officer relating to any issue of fact or of law on any matter then pending before said hearing officer”. (R.I.Gen.Laws 42-17.7-7)

The Champlin’s decision would appear to go further and say that any decision by the Director in reviewing a hearing officer’s decision must be based solely on the record of the hearing. Depending on the complexity of the matter and the length of the hearing, that could be a good bit of review and reading time.

And if the Director wanted to base his decision on anything outside the record, it would seem the Director would have to notify the parties and give them an opportunity to challenge any such evidence. That, of course, could result in more time-consuming review.

Who knows—perhaps a busy director would not find the proposed legislation so objectionable!

• Email This
• Print
• Comments
• Trackbacks
• Share Link