What is Legal Non-Conforming Use?
Although the phrase "non-conforming use" may evoke something negative, in the zoning context it is not necessarily the case. Generally speaking, non-conforming uses are otherwise-classified uses of land and structures that do not conform to the current zoning laws. These non-conforming uses are generally considered to be legally permissible – or even "grandfathered-in" – and, if not already established, may not be introduced.
There are essentially two types of non-conforming use. The first is legal non-conforming use, which means that a property that otherwise does not conform to the local zoning restrictions existed lawfully before a change of those restrictions . For example, if a new zoning ordinance is issued and the new law places residential restrictions on a part of the city that previously allowed commercial development, a commercial property that was already in existence in the affected area would likely be considered a legal non-conforming use.
By contrast, an illegal non-conforming use is one that did not come into existence in accordance with any zoning laws. Using the commercial-residential example, a commercial property could be considered an illegal non-conforming use in an area where residential use was permitted, and the landowner went ahead and developed the land into the commercial enterprise without getting the proper approvals from the zoning office. In other words, a legal non-conforming use is created under the law, while an illegal non-conforming use is unlawful from the beginning.
History and Purpose of Legal Non-Conforming Use
The legal concept of non-conforming use arose in the late 19th century as a way to protect property owners from government taking through the exercise of the police power and also as a means to prevent non-conforming uses from being eliminated on a wholesale basis through zoning restrictions. Ransom v. Bond, 8 S.W.2d 699 (Tenn. 1928); 444 v. Reid, 358 S.W.2d 705 (Tenn. 1962); 899 v. Tennessee Gas Transmission Co., 349 S.W.2d 830 (Tenn. 1961). The importance placed on non-conforming use in the context of statewide planning is illustrated by the following summary of the origins of zoning in Tennessee: In the early 1900’s a number of cities and towns, including Memphis, adopted municipal ordinances regulating the height and area of buildings, and prohibiting obnoxious features, in order to promote traffic safety and convenience and regulate the location and character of commercial and industrial buildings. In 1939, a zoning bill was enacted by the Tennessee Legislature in the form of a perpetual legislative act applicable only to the cities and towns which adopted it. McNutt v. Carroll, 239 S.W.2d 803 (Tenn. App. 1956) (emphasis added). A constitutional amendment in 1953, Art. 11, Sec. 8, Tenn. Const. expressly authorized the state legislature to confer upon local governing bodies the power to make regulations regarding zoning and building lines. Id. (codifying the existence of zoning). In 1955 the State of Tennessee enacted a comprehensive zoning law applicable to all municipalities authorizing such a regional system of planning, coordinated regulation and growth. Id. It was pursuant to this 1955 general act that the zoning ordinances were enacted. The general concept in Tennessee, and most other jurisdictions, is that affected property owners are entitled to continue the same use as long as they do not enlarge or extend that use. The intent is to protect the investment made by the property owner at the time of the ordinance adoption. See City of Nashville v. Consolidated Engineering Co., 236 S.W.2d 360 (Tenn. 1950). The rationale is sound: The overwhelming majority of states, including Tennessee, allow for "vectors of growth and development so that property rights will be protected from wide fluctuations, and that land may be used consistent with good planning". Horne Properties, LLP v. City of Oak Ridge, 179 S.W.3d 523 (Tenn. 2005) (citing Community Improvement League v. City of Alcoa, 172 S.W.2d 853 (Tenn. 1943).
Case Examples of Legal Non-Conforming Use
Examples of Legal Non-Conforming Use can often be found in the following commonplace scenarios. A residential building located in a permitted commercial zone, or an office building located in a permitted residential zone. Sometimes a store or business will continue to operate in a district that has changed. For instance, a bar may have been permitted in a residential area until a change in zoning prohibited any further businesses from operating in the area, but the bar can continue to operate as long as the use has not been altered. These are but a few examples of a legal non-conforming use. In most downzoning cases there is an expected grandfathering clause applied to prevent a nonconforming use from being forced to shut down overnight.
Implications for Property Owners
The granting of legal non-conforming status is usually the best result obtained for a property under a zoning ordinance. However, all is not over at that point for a property owner and property. The granting of legal non-conforming status for a property may create a thorough list of possible issues with the zoning of that property. Sometimes zoning ordinances will apply restrictions or limitations on a legally non-conforming use or structure that would not otherwise apply if such use or structure were a permitted use or structure. For example, if the property is located in a residential zoning district, then no sales activity can take place.
A convenient way to clarify possible restrictions on a legally non-conforming use or structure is to ask for an interpretation of the zoning ordinance to clarify for purpose of the current use or structure whether or not there are any restrictions or limitations on the use or structure. An interpretation can be made pursuant to the municipal code or through a variance. Either way, it will give the municipal authorities notice as to whether or not the zoning ordinance in its current form applies restrictions or limitations on the property.
If the structure is non-conforming but still structurally sound, then the property owner can approach the municipality to get permission to renovate the non-conforming structure. Such renovation may even include the addition of new square footage because of the municipality’s interest in having the property upgraded and renovated. For example, upgrading the plumbing or electric service to meet current code is a common condition of the grant of approval for a renovation. A renovation may or may not trigger the need for proof of legal non-conforming use if the existing use or structure predates the current zoning ordinance.
With respect to the issue of property value, the general legal principle is that legal non-conforming status will not be sufficient in itself to allow a bank to appraise the use as if it were a permitted use for purposes of a loan application. Although it certainly is worth noting that the legal non-conforming use status can add some value to property because there is a waiver from compliance with the zoning ordinance, it is unlikely that an appraiser will assign significant value to the legal non-conformity. In short, a bank will be wary of the value of a property with a legal non-conformity despite what the use is if the use is risky. If the use is a bar, truck terminal or other use that is classically perceived as problematic, then the legal non-conforming use may not account for the risk that a lender concludes is involved with the use.
The impact on property owners can be significant. The departure from the zoning regulations may have a direct impact on the property value. Conversely, if a property owner has the maximum value placed on property because of extraordinary legal non-conformities, then the main purpose of the exception is achieved. Any other property owner that has similar legal non-conformities, whether with the building coverage, lot size, or use, will benefit from the development rights being exercised for that property owner. That is, they too can make use of the property and improve it to their needs. The overall practical impact of legal non-conforming uses is clarity of what has been adopted by the municipality as a permitted use.
Amending a Non-Conforming Use
A property owner wanting to change a legal non-conforming use must seek the approval of the zoning board. The process typically requires filing an application with the zoning board of appeals and paying a fee, which varies by municipality, to cover the costs of advertising the hearing to certain tax parcel owners and municipal officials. There is usually a requirement of a corresponding site plan review.
The function of the zoning board of appeals is to fairly adjudicate applications of this sort. For that reason , they are prohibited from "ex parte" communications. This essentially means that the members of the zoning board are not permitted to discuss the particular facts and circumstances of an application with the applicant or her representative off the record. The purpose of this prohibition is to ensure that the mere appearance of bias is eliminated. The comments of the members of the zoning board must be made available in the record in such a manner that all parties to the application have an equal opportunity to review the entire record and respond to the comments.
The zoning board of appeals will hold a public hearing at which time the applicant and opponents of the application will have a full opportunity to speak and offer evidence. Once the hearing is concluded, the zoning board of appeals will render a written decision that includes factual findings and conclusions of law. Thereafter any aggrieved party then has 30 days to appeal the zoning board’s determination to a court of competent jurisdiction.
Risks and Legal Implications
While legal non-conforming use status may provide useful options, it is not necessarily an asset that should be taken for granted. If the property undergoes so much renovation or redevelopment as to constitute "intensification," "enlargement," or "extension" of the use, it may lose its legal non-conforming status – a risk that should always be considered before entering into contracts for sale. Furthermore, if the development standards in the zoning district have changed since the time of the granting of legal non-conforming use status, it will be subject to all of the current development standards and the possible loss of legal non-conforming status. Many municipalities have extensive provisions in their zoning ordinances detailing restrictions on the intensification, enlargement and extension of non-conforming uses and structures; these restrictions should be carefully reviewed to determine their applicability.
Future Considerations and Trends
Future trends and developments – Legal non-conforming use (or FP and EA) There are a couple of ways to approach the future trends and developments tag. It can be a sort of forecasting or it can also be about what this post will be about, which is a review of the new FP and EA Code.
The FP and EA Code has been released and many municipalities have updated their comprehensive plans to discuss the new code or plan updates which identify the consequences of the new code.
All permit applications, developments and zoning modifications will have to comply with the new FP and EA Code. So what are some ways municipalities will deal with the new code?
The most relevant is the concept of "evaluation factors." When a parcel does not meet the new requirements, it can be evaluated to determine if it could be granted an attendance exception. The factors include compatibility with the adjoining neighborhoods, the ability to withstand a flood (which can be based on the level of proposed filling), the history of flooding on the property and its potential effects on flooding on upstream and downstream properties. Standing alone , these factors may seem similar to other variance factors or special exceptions. However, it cannot be forgotten that the intent of the new code is to reduce the flood prone area by requiring that parcels be filled and elevated to meet required dredged elevations. This in part means raising new structures or additions several feet. For many homes in lower areas, this will be 4-9 feet or more. The idea of providing these factors for elevation and fill, therefore may even require that a variance be obtained.
Additionally, the new Code has eliminated the general purpose exception once used by the Chief Engineer to grant variances or waivers in cases where the protection of the floodplain, seashore or wetlands would not be harmed. Now, the Chief Engineer will only grant variances or waivers to preserve minority rights.
Moreover, there is now a requirement for flood insurance, the cost of which is generally prohibitively expensive for residential owners. These changes will have to be dealt with as well.
Collectively, the litigation and regulatory changes make the future of maintaining legal non-conforming use more difficult.