Land Use: A Follow-Up to the Hale Decision

June 29, 2009

Virginia Vested Rights Law is Further Developed in Board of Supervisors v. Crucible, Inc.

On the heels of its February vested rights case of Hale v. Board of Zoning Appeals (see our May 13 news item for details), the Virginia Supreme Court issued its opinion in Board of Supervisors v. Crucible, Inc., the second vested rights case of 2009. Crucible involves two basic issues regarding vested rights: (1) whether a property owner can bypass the zoning administrator’s vested rights determination and go directly to the circuit court; and (2) whether a zoning verification letter constitutes a “significant affirmative governmental act” under the vested rights legislation.

Recall that Virginia Code section 15.2-2307 provides that a landowner may take certain steps to establish vested rights in the zoning classification that will be retained even if the zoning law changes. One of those steps involves receiving the benefit of a “significant affirmative governmental act.” Section 15.2-2307 defines, “without limitation,” six governmental actions as “significant affirmative governmental acts” (e.g., acceptance of proffers for a specific use or density, issuance of a final site plan or subdivision plat, etc.).

In the Crucible case, Crucible, Inc. proposed to develop a facility for training government agents and employees in certain disciplines, including firearms usage, unarmed combative defensive tactics, surveillance detection and anti-terrorist evasive driving. The intended development property, located in Stafford County, was zoned A-1 (agricultural) under the Stafford County zoning ordinance, and the A-1 district regulations permitted schools “by right.” The Stafford County zoning administrator issued a zoning verification letter that confirmed that the proposed facility met the definition of a “school” under the Stafford County zoning ordinance. The verification letter included limiting language that described the determination as being valid “as of May 11, 2004, and is subject to change.” After receiving the verification letter, Crucible, Inc., on July 26, 2005, purchased the subject property for $2,250,000.00.

On August 24, 2005, (prior to Crucible, Inc. obtaining an approved site plan), the Stafford County Board of Supervisors amended the A-1 district regulations to require the issuance of a conditional use permit for schools in the A-1 district. Rather than requesting a vested rights determination from the zoning administrator, Crucible, Inc. filed a declaratory judgment action in the Stafford County Circuit Court seeking a determination that it had vested rights to develop a school on the A-1 zoned property. The county challenged the action on two counts: (1) that Crucible, Inc. had failed to exhaust its administrative remedies because it had failed to request a vested rights determination from the county’s zoning administrator; and (2) that the zoning verification did not constitute a significant affirmative governmental act and, thus, Crucible, Inc. had not established vested rights for the school use. The circuit court determined that Crucible, Inc. did not need to exhaust its administrative remedies and also determined that the zoning verification was a significant affirmative governmental act. In the circuit court’s final analysis, Crucible, Inc. had vested rights to develop the school as it had originally intended.

On appeal, the Supreme Court of Virginia stated that the circuit courts had been empowered to make vested rights determinations prior to the enactment of the provision in Virginia Code section 15.2-2286 that gives zoning administrators the authority to issue such determinations. The court noted that this code provision did not make exclusive the zoning administrator’s authority to issue vested rights determinations. Thus, the court reasoned, the circuit courts were still empowered to make such determinations. However, the court also found that the zoning verification did not constitute a significant affirmative governmental act. Although the court recognized that the realm of significant affirmative governmental acts was not limited to the six listed in Virginia Code section 15.2-2307, the court was unconvinced that the verification constituted a significant affirmative governmental act. The court, quoting Hale, stated that “when a landowner has only a future expectation that he will be allowed to develop his property in accord with its current classification under the local zoning ordinance, there is no vested right in the continuation of the land’s existing zoning status.” (internal quotes omitted). The limiting language in the letter –“as of May 11, 2004, and is subject to change”– appears to have been the key reason why the court determined that the letter provided no future expectation about the zoning.

Vested rights law in Virginia continues to evolve through legislation and case law. The Crucible case adds to that evolution by providing property owners an option with regard to obtaining a vested rights determination (whether to go to the zoning administrator or straight to the circuit court). Crucible also makes it clear that zoning verification letters like the one issued by Stafford County will not be deemed to constitute a significant affirmative governmental act upon which a vested right can be established.