Development Agreements

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Development Agreements

• What contract zoning?

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• The development of land is a long term business
  commonly involving 20 years
• Additionally, it has high "front-end" costs.
• Because of both high front-end costs and many
  years to reach an economic return,
• developers need some degree of certainty.
• Vested rights and equitable estoppel simply did
  not provide the necessary degree of certainty.
• Thus, development agreements.

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Chapter 163.3220 the "Florida Local Government
Development Agreement Act."

• This Act authorizes local government to enter
  into agreements contracts with developers.
• This agreement which can be in effect for up to
  10 years sets the ground rules for the
  development.

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• A development agreement sets out what are the
  relevant regulations that the developer must
  adhere to and
• it may find that the development is "consistent
  with the local government's comprehensive plan
  and land development regulations."
• Although Pinecrest Lakes made it clear that there
  can be judicial review of such findings.

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• A development agreement can fix regulations,
  i.e., warrant against changes in regulations, for
  defined periods of time up to 10 years.
• If an agreement does not specifically address a
  subject, there is no agreement on that subject
  and the development would be treated like any
  other.
• e.g., if the agreement does not address the
  imposition of impact fees, or the increase of
  existing fees, then the agreement places no
  constraint on such actions.
• See Key West v R.L.J.S. Corp., 537 So.2d 641.

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• From a developers point of view
• Silence in NOT golden.

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Giger v Omaha, 442 N. W.2d 182 (Ned.1989)

• Midlands applied to Omaha for
• A PUD that allowed
• 112,000 FT² of retail space
• 390,000 FT² of office space
• 300 residential units.
• Omaha agreed and the two parties entered into a
  development agreement.

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• Neighbors filed suit contending
• That rezoning by agreement is contract zoning and
  therefore illegal.
• The city bargained away its police powers in
  return for a 36 acre city park
• Plaintiffs asked for nullification of the
  rezoning and the development agreement on which
  it was based.
• There was another plaintiff whos interests are
  not relevant to this course.

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• Trial court dismissed plaintiffs case.

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Nebraska Supreme Court

• In upholding the lower court . . .
• Noted that zoning was a legislative function
  delegated to Omaha by the Nebraska Legislature.
• The court said that they give great deference
  to the citys determination of which laws should
  be enacted for the welfare of the people.

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• The court chose to view the development agreement
  as a means to assure that the developer complied
  with the various representations made in the
  approval process.
• They referred to the result as conditional
  zoning, which can be distinguished from
  contract zoning.

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• Conditional zoning is a legislative function and
  therefore must be within the proper exercise of
  the police power. Accordingly,
• the conditions imposed by the city for the
  rezoning must be reasonably related to the
  interests of public health, safety, morals and
  the general welfare.
• If such zoning did not meet this requirement,
  then it would be illegal, either as contract
  zoning or simply because it was an invalid
  ordinance.

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In Florida . . .

• Development agreements are common
• Under the Development Agreements Act
• and
• not under the act, thus based on a local
  governments home rule authority.
• Agreements not under the statute are commonly
  called developer agreements rather than
  development agreements.
• The statute did not preempt agreements outside of
  the statute.

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Which is better?

• If I represented a developer, I would want a
  development agreement under the statute.
• If I represented a local government, I would want
  a developers agreement under home rule.

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Recent action

• There has been a suit filed seeking to nullify a
  developers agreement between Waco Properties
  and the City of Alachua.
• This agreement was not under the Act and that is
  the basis for the action
• Because there was a route provided, any other
  agreement would not be authorized.
• If upheld, there would be chaos and subsequent
  litigation would go for years.

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