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Washington Supreme Court Strikes a Blow to Vested Rights



In a blog post dated February 17, 2016, we wrote about a decision of the Washington Court of Appeals in Snohomish County v. Pollution Control Hearings Board favorable to developers. At issue in the case was the Washington State Department of Ecology’s rule that required application of new stormwater regulations to all development proposals submitted before July 1, 2015, if the developer does not start construction by June 30, 2020. The court of appeals took issue with Ecology’s rule, and held that the new stormwater regulations do not apply to “vested” developments. An owner vests its development proposal on the date it submits a fully complete land use application to a county or city. To "vest" means to fix the rules that apply to the development at the time of application. Any later-enacted land use control ordinances or regulations do not apply to a vested development. Key to the court of appeals’ decision was its holding that a developer vests to “land use control ordinances,” with the finding that stormwater regulations are land use control ordinances.

The Washington Supreme Court accepted review and issued a reversal of the court of appeals in a decision dated December 29, 2016. The supreme court took issue with the court of appeals’ essential finding that stormwater regulations are land use control ordinances that benefited from the vested-rights doctrine. The Court went into a lengthy analysis, examining the texts of the vested-rights statutes, the legislative history of the vesting statutes, the development of the vested-rights doctrine in case law, the deference rules applicable to the Pollution Control Hearings Board and the Department of Ecology, the legislative action surrounding Ecology’s 2013 stormwater permits, and the doctrine of the finality of land use decisions. In the end, the supreme court ruled:

The legislative history and our precedent demonstrate that the vesting statutes were intended to restrict municipal discretion with respect to local zoning and land use ordinances. Because state and federal law direct [counties and cities] to implement the storm water regulations at issue in this case, the regulations are not the sort of local municipal land use and zoning ordinances the legislature was concerned with.

“Bread and butter” zoning regulations governing uses, and including development restrictions not mandated by state and federal law, will continue to fall under the vested-rights doctrine. But other regulations, especially those mandated by state or federal law, may not. The Court’s thorough dissection of all the arguments on both sides of the issue should guide practitioners in determining whether the vested-rights doctrine applies to a local environmental or land use regulation.

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