Protecting Private Property: The Case for Vested Property Rights

Posted on March 01, 2004 | Type: Policy Report | Author: Jordan R. Rose
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EXECUTIVE SUMMARY

Many Arizona property owners have learned the hard way that municipalities are free to change zoning classifications and thereby "downzone" parcels of land. Also, local governments may change the zoning restrictions or requirements included in zoning ordinances. Such government actions frequently diminish the value of landowner's properties and destroy investments.

One property owner in Pima County held his property for nearly 20 years, waiting to commercially develop it, only to have county bureaucrats downzone his land, costing him thousands of dollars. A few years ago, Glendale downzoned a parcel at 51st Street and Olive to prevent the construction of a Wal-Mart store. Scottsdale downzoned several parcels of land to prevent moderate-density single-family housing developments from being constructed. There are also numerous examples of municipalities changing restrictions in zoning ordinances, including requiring more parking and limiting sign usage. Those changes deprive property owners of the right to use their properties in accordance with the zoning schemes in place at the time they purchased.

Arizona enacted legislation in 1998 in an attempt to provide some protection to property owners whose land was located in unincorporated portions of a county. The statute required the written consent of a property owner prior to the downzoning of a parcel of land. Unfortunately, the Arizona Court of Appeals struck down the statute as an unconstitutional delegation of power to the property owner. The Arizona courts have also held that unless a property owner's right "vests," local governments will continue to have the authority to downzone or amend a zoning ordinance.

Because neither the legislature nor the courts have established exactly when property rights vest, the Arizona legislature should provide protection and certainty for property owners. A starting point would be to enact legislation similar to New Hampshire's vesting statute. The statute provides that a landowner is guaranteed an exemption from all subsequent zoning changes upon approval of a plat or site plan. If Arizona adopts similar vesting legislation, it should provide that a vested right is established upon the submission of a plat or site plan to the appropriate government entity so long as the plat or site plan conforms to zoning requirements in place at the time of submission. This would allow a landowner to secure vested rights without relying on an act of the municipal government.

Read Protecting Private Property here.

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