Court of Appeal Sheds Light on Moratoria, Phasing and Final Maps

By Kate J. Hart and Janell M. Bogue

In Ailanto Properties, Inc. v. City of Half Moon Bay (August 30, 2006) 2006 Cal. App. Lexis 1317, the First District Court of Appeal held that Government Code section 66452.6 (b)(1) limits the length of any moratorium-related tolling of the expiration of a tentative map to five years, regardless of the length of the moratorium itself. The court further held that when a phased final map does not conform to the requirements of the vesting tentative map ("VTM"), then the filing will not extend the life of the VTM pursuant to Government Code section 66452.6(a)(1) and (d).

The history of the development takes a long and winding road. In 1985, the Ailanto development company ("Ailanto") purchased 114 acres in the City of Half Moon Bay (the "City"). Ailanto originally intended to subdivide the large parcel and develop it into 228 single-family homes. It submitted the requisite applications and in August 1990, the City Council certified the EIR and conditionally approved the vesting tentative map. Unfortunately for Ailanto, the City adopted a sewer moratorium in March 1991 to prohibit future allocations of sewer connections until the sewage treatment plan was expanded. The sewer moratorium applied to Ailanto's development, as did an existing moratorium dealing with water supply. The water supply moratorium was lifted in 1994 and the sewer moratorium expired in 1999.

In February 1998, Ailanto submitted an application for a coastal development permit and after several years, the Coastal Commission approved the permit subject to conditions including reducing the developable lots to a maximum of 63. Naturally, Ailanto appealed the decision. With the appeal pending, Ailanto then filed a phased final map with the City engineer on May 10, 2001, which the engineer returned because the map was not in substantial conformance with the requirements of the tentative map. Specifically, the engineer noted that Ailanto had not received its coastal development permit and thus, had not satisfied the conditions of approval for the tentative map. Ailanto sued the City, and the trial court held that the tolling period was limited to five years, but that the filing of the phased final map extended the life of the VTM. Both Ailanto and the City appealed the trial court's decision.

First, Ailanto argued that Government Code section 66452.6(b)(1) prohibits any moratorium from being in effect for longer than five years. The statute reads:

(b) (1) The period of time specified in subdivision (a), including any extension thereof granted pursuant to subdivision (e), shall not include any period of time during which a development moratorium, imposed after approval of the tentative map, is in existence. However, the length of the moratorium shall not exceed five years.

The court disagreed with Ailanto and it found that though the language of the statute was ambiguous, the legislative history demonstrated that the five year limitation only pertained to the tolling period and not the length of the moratorium itself. Additionally, the court also said that "reason, practicality, and common sense" lead it to hold that the tolling period was limited to five years. The court said:

As should be obvious, Ailanto's interpretation would lead to absurd practical results. If it were adopted, then development moratoria would expire after five years without any regard for the conditions that led to their imposition. Thus, localities that lacked sufficient water or sewer capacity to accommodate new development would be able to prevent development for up to five years but would be powerless to stop it thereafter, whether or not water or sewer capacity was adequate. We are simply unwilling to impute such an intent to the Legislature.

Second, Ailanto argued that the five-year time period in the statute applies separately to each development moratorium and that multiple moratoria should lead to multiple tolling periods. The court also disagreed with this argument. The court found no support in the statutory language. Though Ailanto argued that Native Sun v. City of Escondido (1993) 15 Cal. App. 4th 892 supported its position, the court said that the issue had not been addressed. Further, the court said that the case was factually distinguishable because Native Sun involved the city's adoption of a "friendly moratorium," whereby the moratorium would end upon either the city's approval of the facilities plan or the approval of developer's final map. The court noted that the City of Half Moon Bay never agreed with Ailanto to waive the time limits on the life of its map, as was done with the "friendly" moratorium in Native Sun.

Finally, Ailanto argued that the filing of the final map operated to extend the life of the vesting tentative map for another three years pursuant to Government Code section 66452.6 (a)(1) and (d). The court of appeal disagreed with Ailanto. The court held that a final map that does not substantially conform with the VTM cannot extend the life of the same map. Here, at the time the final map was submitted, Ailanto had not yet obtained a coastal development permit - a specific requirement of the tentative map. The court said:

In this case. . .if we were to accept Ailanto's argument, it could secure extensions of its vesting tentative rights simply by filing documents that purported to be phased final maps with the city engineer, even if the documents failed to comply with the conditions of the vesting tentative map. We will not adopt an interpretation of the statute that would lead to such a result.

The first and most obvious lesson to be learned from this case is that the expiration of a tentative map cannot be tolled for more than five years under Section 66452.6(b)(1). For longer time periods, a developer should obtain a development agreement which allows tentative maps to be extended for the term of the agreement. In the alternative, developers should secure some other type of written agreement from a city or county waiving the time limitations in place for the tentative map if a moratorium has been imposed. Clearly, of the two choices, the development agreement is the preferred strategy.

Further, when submitting a phased final map, make sure it substantially conforms to the requirements of the tentative map. The subdivider must satisfy all conditions of approval prior to obtaining the final map unless a specific statutory exemption is provided (e.g., subdivision improvement agreement is executed). Facial non-compliance is a non-starter.

Kate J. Hart is an associate and Janell M. Bogue is a law clerk with Abbott & Kindermann, LLP. For questions relating to this article or any other California land use, environmental and planning issues contact Abbott & Kindermann at (916) 456-9595.

The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, LLP, nor the formation of a lawyer/client relationship. Because of the changing nature of this area of the law and the importance of individual facts, readers are encouraged to seek independent counsel for advice regarding their individual legal issues.

Trackbacks (0) Links to blogs that reference this article Trackback URL
Comments (0) Read through and enter the discussion with the form at the end