Now that the extension period has ended, it is imperative for those involved in real estate development to review and understand the approvals and permits that affect their properties and properly calculate and verify the expiration dates.
Pennsylvania’s Development Permit Extension Act, 53 P.S. § 11703.1, et seq. (the Act), was initially adopted as part of Act 46 of 2010, amended by Act 87 of 2012 and further amended and recodified by Act 31 of 2015. The Act provided much-needed relief to struggling real estate developers and homebuilders during the recent recession by suspending, until July 2, 2016, the running of the period of approval for a myriad of state and municipal real estate development approvals, permits and agreements. Now that the extension period under the Act has ended, it is important for developers and others holding permits affected by the Act to understand when those permits expire and how they will be treated prior to expiration.
Calculation of Expiration
- If a permit was issued on or before December 31, 2007, the approval clock stopped on January 1, 2008, and the remaining time runs beginning on July 2, 2016.
- If a permit was issued on or after January 1, 2008, but before July 2, 2013, the entire approval period begins on July 2, 2016.
- If a permit was issued on or after July 2, 2013, the approval period is not extended beyond the normal approval period without permission or approval of the governmental agency.
For example, consider a developer that received a preliminary land development plan approval for a multiple lot residential development on January 1, 2007 and has not yet completed the improvements shown on the plan. By virtue of section 508(4) of the Pennsylvania Municipalities Planning Code, 53 P.S. § 10508(4), and the Act, that developer is permitted to complete the improvements without being adversely affected by a change in land use ordinances until July 2, 2020.
Similarly, if a commercial developer receives zoning relief on September 4, 2012, conditioned upon the issuance of a building permit within one year of the relief being granted, the developer has until July 2, 2017 to pull the building permit.
If a developer or other permit holder is uncertain when the approval is calculated to expire, the Act provides the ability to request from the issuing governmental agency a written verification of the approval’s expiration date. The request must identify the approval in question and its estimated expiration date under the Act. Except in the city of Philadelphia (and agencies established by the city of Philadelphia), failure by the governmental agency to respond within 30 days of the request results in a deemed affirmation of the approval’s expiration date as set forth in the request. However, a governmental agency may charge a fee of up to $100 for verification of a residential approval and up to $500 for verification of a commercial approval. Also, the failure of a permit holder to seek a verification cannot be grounds for the termination, revocation or other invalidation of such a permit.
Now that July 2, 2016 has passed, it is imperative for those involved in real estate development to review and understand the approvals and permits that affect their properties and properly calculate and verify the expiration dates.