Odd provision in state law severely undercuts growth management

Printer-friendly version

By Robert McClure

InvestigateWest

An unusual provision of Washington law has repeatedly authorized major real-estate developments to go forward even after they’ve been declared urban sprawl that violates the state’s landmark Growth Management Act.

In 2007, nearly 1,000 homes were given the green light in Clark County in Southwest Washington where 10 would have been allowed otherwise, and 514 lakeside acres previously set aside for farming were designated instead as industrial and office park land, InvestigateWest’s reporting reveals. In 2005 in Spokane County, the practice authorized more than 1,500 homes to be built where 22 or fewer would otherwise have been allowed in the Five Mile Prairie neighborhood, and up to 480 homes where eight would otherwise be permitted near the Spokane airport.

Last year, this practice allowed one Whatcom County developer to lock in the right to build 1,246 homes near the Canadian border 25 days before passage of a law that allowed only one-tenth that number.

The Growth Management Act — passed in 1990 to rein in runaway development that chokes roads, spurs water pollution and carpets the countryside in concrete — is only one of a number of environmental and land-use laws to be undercut by a feature of Washington law that gives developers unusually favorable treatment compared to most other states.

Known as “vesting” and dating back more than half a century, the legal provision means that if a developer learns a new law is coming that would restrict building, he or she can draw up preliminary plans for a subdivision, file the paperwork with the county — and avoid the new, more restrictive rules. Even if construction doesn’t start for years.

This system contributes to urban sprawl that eats up undeveloped rural land and increases pollution of waterways from tainted water running off roofs, streets, and parking lots.

“It’s maddening! Savvy developers with high-paid consultants come in and game the system,” said David Bricklin, a Seattle attorney who has represented neighborhood and environmental groups fighting such developments. “It undermines the democratic process.”

But developers say they invest many thousands of dollars in preparing development proposals and count on Washington’s vesting law to preserve their investments.

They argue that already-high housing costs will rise even more if there are restrictions on vesting. And they call the practice a “lifeline” for a struggling industry.

“For us it’s like the last life preserver we have out in the choppy seas, and we’re hanging onto it for dear life,” said Jodi Slavik, an attorney and lobbyist with the Building Industry Association of Washington. Apart from the vesting laws, she said, “We have one of the most restrictive states in terms of the regulatory climate on the building industry.”

State Growth Management Hearings Board member Joyce Mulliken of Moses Lake said that although only a small number of local governments have purposely allowed developers to skirt the state’s law, the system has been abused in some cases.

“That’s not the way it’s intended to be,” she said. “That’s not honoring the intent of the law.”

In many cases, the end result is development built to older environmental and construction standards long after new standards are in place. Hearings Board member Margaret Pageler of Seattle acknowledges the problem, but says any fixes are in the Legislature’s hands.

Even developers building on lots not affected by the Growth Management Act have long benefited from Washington’s generous vesting provisions. These measures allow lots to be developed under rules that are sometimes decades old. As a result, property owners avoid new environmental regulations and lot size rules.

In King County, citizens living in and around the small rural town of Black Diamond on Oct. 11 petitioned King County Superior Court to halt a developer who is trying to lock in rights to nearly quadruple the town’s population and build 1 million square feet of big-box stores and other retailers. Opponents claim the Yarrow Bay developments’ plans to bring 6,000 new homes to a town that has about 1,500 people would also cause pollution of nearby Lake Sawyer because the town passed an ordinance that seeks to freeze in time restrictions on polluted runoff. The developer and town deny that the development would pollute the lake.

In Pierce County, a developer filed an application in 1993, giving him the right halfway through this decade to break ground on 402 homes on a 206-acre property.  Today’s rules would allow just 15 homes on the land.  The development went in right next to a facility that bred endangered wolves, which had to move.

In Snohomish County, developers who learned in 2005 the county council was considering protecting wetlands, streams, and other environmentally sensitive areas hustled to the permit counter, beating the clock to build more homes. While 616 development applications came in during the two years before the law went into effect, only about one-fifth that many came in during the two years afterward.

In Whatcom County, a builder with land by Lake Samish near Bellingham, citing a 1992 development application, says he is entitled to build 47 homes on 25 acres, where five would be allowed under today’s rules. This project was hard-fought by protesting neighbors of the Sleepy Hollow development, but a 2009 hearing examiner ruling went in developer Derek Stebner’s favor. He will also benefit from a 2001 ruling allowing him to leave 50-foot stream buffers to protect fish instead of the currently required 100-foot buffers.

Washington's vesting provisions came into sharp relief in a recent case before the Washington Pollution Control Hearings Board, the court where folks unhappy with state environmental rules often land. Part of an enormously complicated case out of Clark County in southwest Washington posed this question: Does Washington's half-century-old practice of locking in developers' rights apply even if it runs afoul of newer state and federal laws? In a ruling last week, the pollution board said vesting does not trump the Clean Water Act. But developers and county officials are expected to appeal to Superior Court.

Meanwhile, in Olympia, Sen. Adam Kline has tried several times to make Washington’s vesting law more like those in most other states, where building rights aren’t locked in until construction starts. He says he’ll try again this year and he has a new game plan.

“Washington has literally the earliest possible date” for locking in developers’ rights to build, said Kline, D-Seattle. “It’s the least sexy but probably one of the most important aspects of environmental law.”

Back when Seattle had no Space Needle and kids were digging a new form of music called rock ‘n’ roll, the would-be developer of a 12-story apartment house on Queen Anne got the city to issue him a building permit — one day before restrictions on apartment-house heights went into effect. There was just one problem: Developer A.A. Hunt didn’t yet own the property not far from the modern-day Space Needle.

Neighbors, angry that they were about to lose their stunning views of Elliott Bay and downtown, went to court. They lost. In one of the crucial first few cases to establish Washington’s vesting laws, the Supreme Court decided that the most “practical” way to decide when building rights are guaranteed is to pick the very earliest contact the developer has with the government — when he or she submits an application for a building permit. Later court cases and ultimately the state Legislature in the 1980s expanded this concept to include applications to subdivide land for development.

The basic logic behind the courts’ early decisions was that it’s unfair for a newly elected city or county council to pull the rug out from under a developer who has spent a lot of money getting ready to build under the old zoning ordinances.

Developers gained even more leeway in a series of court cases in the 1990s.  And this year, citing the massive economic downturn, the Legislature temporarily extended from five to seven years the amount of time developers have to finalize development plans after their initial plan is submitted.  So under the two-part process of development, from filing a preliminary plat to gaining approval for a final plat and beginning construction, builders who previously had 10 years to build now will have 14 years before the developer’s vested rights expire and tighter regulations kick in.

Cities and counties do not always rigorously enforce those limits anyway, said Tim Trohimovich, co-director of Futurewise, a non-profit group that supports rigorous growth-management laws. He calls it a “significant problem” and says local governments need to pay more attention.

Only a few states, including Texas, California, and Colorado, have adopted statutes similar to Washington’s in which filing an application for development secures building rights under existing codes and regulations.

In more than half the states, a developer’s right to build is not guaranteed until he or she has done “substantial construction in reliance on a validly issued building permit,” said Dwight Merriam, chair of the American Bar Association’s 11,000-member Section of State & Local Government Law.

In most of the remaining states, builders get their guarantee of development rights a little earlier in the process, when a local government approves a building permit or subdivision application.

Kathy Miotke remembers when herds of deer would thunder by her home, days when the nighthawks would fly so close she could hear their wings beating. When she moved to Five Mile Prairie near Spokane in 1969, she was definitely living out in the country. Astronomy groups would come to the mesa to escape city lights. That all changed, and one of the biggest changes came when Spokane County commissioners expanded the county’s urban growth area to include Five Mile Prairie, allowing more than 1,500 homes where 22 would otherwise be authorized.

Miotke and her neighbors, calling the commission’s act blatantly illegal, appealed the decision to the Eastern Washington Growth Management Hearings Board. They won.

But, because of a provision in the Growth Management Act, the county’s action was considered the law of the land while the growth board decided the case. That took nearly six months. In the meantime, developers filed preliminary paperwork laying out their plans for large subdivisions. Because of Washington’s vesting provisions, that meant the developers had the green light to continue — even after the growth board said the developments did not comply with the Growth Management Act.

So instead of being allowed to build one home for every 10 or more acres, up to six homes per acre were authorized on 221 acres, and up to 15 housing units were allowed for the remaining 13 acres, bringing the total possible to 1,521.

Now that the subdivisions are going in, they are causing problems with drainage, Miotke said, which comports with the county’s designation of Five Mile Prairie — even before the new developments — as “a major stormwater problem area.”

“We won, but we lost,” Miotke said recently.

The case actually had to go back to the growth board again, after which Miotke and her neighbors were again proclaimed the winners.

The growth board’s second ruling highlighted the county’s actions, lamenting in 2007: “Here, two years have passed. The area within the expanded (urban growth area) has been blanketed with developments or vested development permits. The once rural area clearly has changed."

Much the same thing happened at Spokane’s West Plains neighborhood, and in northwest Whatcom County.  In the Clark County towns of Ridgefield and Camas,  the county moved the urban development line and the cities quickly annexed the property in question — leaving it open for development forever, even after the state growth board said the county’s actions violated the Growth Management Act.

Scott Hildebrand walks around the conference room at the Bellevue headquarters of Master Builders Association of King and Snohomish County, pointing to pictures of past presidents of the powerful developers’ group.

This one declared bankruptcy. That one laid off virtually all his employees. This other one over here retired rather than try to survive in this business climate. A fourth is struggling. Hildebrand points to a lot of pictures before the list ends.

“We’re talking about people who are taking huge chances,” said Hildebrand, the group’s public policy director. “The reason we like the vesting laws the way they are is it gives the builder certainty.

“If you take away vesting, it becomes more of a gamble than it already is.”

But that’s not enough to outweigh the damage Washington’s vesting provisions are doing, said Janette Brimmer, a lawyer with the Earthjustice law firm.

“Vesting can cause all these good things you think you are making happen not happen for years past the date when you thought you got the job done,” Brimmer said. “That’s the real insidiousness of vesting.” 

Part 2 tomorrow: How far will urban development sprawl?

InvestigateWest reporter Oliver Lazenby contributed to this report.

Related stories:

How Washington's unusual developer-friendly laws allow suburban sprawl

Redmond Ridge -- an oldie but a goodie for showing power of "vesting" development

Small town's takeover by big-box developments highlights vexing vesting question

Snohomish developer proceeds with developments that no longer would be allowed

State board limits developers' ability to avoid water laws; but appeal is expected.

Byline: