NC House Passes Reg Reform Bill That Would End Protest Petitions

The North Carolina House last week passed an extensive Regulatory Regulatory Reform bill that would repeal the state statute authorizing the use of the Rezoning Protest Petition (Section 3.5 on Page 22), a tool that too often creates an costly and time-consuming hurdle for property owners and developers.

SB 734 , ‘The Regulatory Reform Act of 2014’ also includes a number of other provisions that are favorable to the real estate industry, including a required study of Local Building Inspector authority (Section 3.10 on page 23), clarification of what constitutes official misconduct for local Code Officials (Section 3.15 on page 29) and the language from HB 150, which clarifies that local governments lack the authority to mandate the aesthetic design of single-family homes, townhomes and duplexes (Section 3.17 on page 30.

But it was the provision repealing the Protest Petition that drew the most fire from opponents. Before being approved, the House rejected a proposed amendment that would have dramatically watered down this language and retained the Petition, which neighboring property owners frequently use to force financial concessions from a developer during a rezoning.

The House bill also removes a controversial provision in the original Senate version that would have allowed unlicensed employees of LLCs and general partnerships to conduct real estate brokerage activities for properties owned by other entities. Consumers harmed in such transactions would have virtually no opportunity for legal remedy, could not file a complaint with the NC Real Estate Commission, or access the NCREC Recovery Fund.

Other real estate-related provisions in the bill include:

  • Insurance Rate Study (Section 2.14) requires the legislature to study whether the Commissioner of Insurance should have the authority to set appropriate rates for homeowner insurance, including the authority to lower current rates.
  • Private Process Service (Section 2.7) directs the legislature to study whether and to what extent private process servers should be used in eviction proceedings. NCAR supports the use of private process servers to reduce costly delays in the eviction process.
  • ADA Pool Requirements (Section 2.11) clarifies that the NC Building Code shall require accessibility to swimming pools only to the extent required under the Americans with Disabilities Act.
  • ROW Notification (Section 3.1) requires local governments to notify the applicant and property owner when beginning a review or negotiation for a right-of-way dedication and associated density credit transfer.
  • DOT Condemnation Procedures and Corridor Maps (Section 3.2) broadens the provision for reimbursement to property owners for costs incurred because of a condemnation proceeding to include situations where the final judgment exceeds the amount of the initial deposit by 35% or more. It also reduces from three years to two years the building permit moratorium for structures located with a transportation corridor map.
  • Notice to Chronic Violators (Section 3.3) was amended to clarify that notices for violations of a public nuisance ordinance must be sent to the address of record for the property owner.

SB 734 now heads back to the Senate, which has not indicated when it will take it up. The chamber can either concur with the bill, which sends it to the Governor, or vote NOT to concur, in which case it goes to a Conference Committee, where members from the House and Senate will try to reach agreement over which individual provisions should remain.

REBIC supports SB 734, and will continue to work with our partner associations in Raleigh to ensure its passage by the end of the legislative session.

Some information courtesy NCAR

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