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EDITORIAL: What a relief: Proffers are back on the table

EDITORIAL: What a relief: Proffers are back on the table

February 13, 2019

THE TREPIDATIONS so many local government officials had three years ago about the General Assembly’s outlawing of proffers turned out to be well-founded. Local leaders soon realized they’d lost the ability to win any concessions from developers. The threat of litigation put them on the defensive. Their bargaining power had evaporated.

Now, in an effort to undo the damage, lawmakers have approved legislation that swings the pendulum back somewhat toward the localities—apparently with the developers’ blessing. Let’s hope there are no flies in that ointment.

Proffers are the cash payments or projects local officials seek or developers offer to mitigate the impact that new residential communities have on local infrastructure. In 2016, developers used their influence in the legislature to rein in the policy.

They made the case, perhaps too successfully, that they were being taken advantage of by local officials who were unfairly upping the proffer ante, coercing developers to build or pay for public amenities that were not made necessary by the particular project at hand.

The approved legislation flipped the legal leverage in favor of the developers, leaving local officials in fear of being taken to court if they so much as mumbled a proffer deemed “unreasonable,” or too far afield. Counties such as Stafford and Spotsylvania quickly repealed their proffer policies because they were now moot and even legally dangerous.

As a member of the Stafford Board of Supervisors at the time, Bob Thomas saw first-hand the harmful effects of the 2016 developer-driven proffer law. When he won retiring Speaker Bill Howell’s House seat in 2017, Thomas found himself in the unique position of being able to right the law’s wrongs by crafting a bill that would repair them. So that’s what now-Del. Thomas did.

Thomas’ bill (HB 2342) and a matching Senate bill (SB 1373) patroned by Sen. Barbara Favola, D–Arlington, are designed to get developers and local officials talking again without fear of reprisal. The 2016 law had effectively halted discussions because of its prohibition of “unreasonable proffers,” defined as proffers addressing impacts that may not be “specifically attributable” to the development at issue.

Local officials felt stymied and at risk of legal peril. Developers, who seek rezonings to increase housing density and make projects more profitable, discovered they were unlikely to win approval for anything more than what they could build by-right. Mixed-use projects with a commercial component were particularly in jeopardy.

Two points jump right out here. First, the two sides need to feel free to negotiate. That’s what smart land use is all about. Local officials were elected to use their judgment on these issues, not sit on their hands and let possibly viable, progressive, revenue-generating projects die on the vine.

Second, county officials work hard to formulate a Comprehensive Plan which supposedly establishes desired density through zoning and directs future growth patterns. But they are then willing to trade those long-term blueprint guidelines for additional rooftops if and only if they can squeeze sufficient proffers from the developer in exchange. Like it or not, that’s the process.

The new legislation, which has been sent to Gov. Ralph Northam to sign, effectively removes the unease either side would feel about merely putting a proffer proposal on the table, thereby encouraging dialogue.

Del. Thomas suggests, and we agree, that this could be the first step toward the adoption of structured impact fees, a system that would establish a developer’s contribution based on the number of rooftops planned and any other relevant elements of a proposed subdivision. Whether the locality uses these fees strictly to improve nearby roads or extend utility lines to the development, for example, or instead chooses to build a library or public athletic facilities, would be stipulated by its policy.

The reality here is that local taxpayers shouldn’t have to foot the bill for the rippling impact new residential development has on their locality. Nor should local government be empowered to gouge too deeply into a developer’s profit margin.

Certainly there is a middle ground here that the new legislation will help establish. Perhaps it will also open the door to a more streamlined process in the future. Simply getting the two sides talking again is a step in the right direction.