[Adapted from Owens, Land Use Law in North Carolina (4th ed., 2023)]
Conditions Not Allowed for Conventional Rezonings
Individual, particularized conditions on rezonings to a general-use district are unenforceable in North Carolina.
Section 160D-703(c) of the North Carolina General Statutes (hereinafter G.S.) provide that, except as specifically authorized, “all regulations shall be uniform for each class or kind of building throughout each [zoning] district.”
In Decker v. Coleman,[1] the court held that this uniformity requirement precluded imposition of conditions on conventional rezonings. In this case, the city of Asheville rezoned a sixty-two-acre parcel from residential to commercial in order to allow construction of a shopping center. The rezoning was conditioned upon the owner’s maintaining a fifty-foot buffer without any access connections between the proposed commercial use and the adjacent residential neighborhood. While such a condition may be entirely appropriate and legal for a special or conditional use permit, here the condition was attached to the rezoning decision. Since such a buffer requirement was not uniformly applied throughout the zoning district, the court held that the city had no statutory authority to apply it as a condition of rezoning a particular parcel. The court thus held the condition invalid and unenforceable.
The inclusion of an invalid condition does not always invalidate the rezoning. Barring other legal defects, the rezoning stands; its conditions do not. In Decker, the city council included a specific severability clause, and the court applied it to sever the condition, invalidate it, and leave the remainder of the ordinance amendment in place. The same result was reached in Kerik v. Davidson County,[2] where the court invalidated a buffer requirement imposed on a rezoning but held the rezoning itself valid.
Conditional Use District Zoning
Conditional use district (CUD) zoning is involved when a landowner requests that property be placed in a new zoning district that has no permitted uses, only special uses. Once widely used in North Carolina, this practice is no longer authorized by the statutes and has been replaced with legislative conditional zoning, described below.
The CUD concept was that a parcel would be rezoned to a new zoning district that had no permitted uses at all—only special uses. The standard practice was to use a conventional district but make all its permitted uses special uses in a parallel CUD. For example, a highway-business district might have twenty permitted uses. The highway-business conditional district would have those same twenty uses allowed, but none of them would be permitted by right and all of them would be subject to getting a special use permit.
Concurrently with consideration of a petition to rezone property into a CUD—a legislative rezoning decision—the governing board considered an individual application for a special use permit for a particular project within the new district. The special use permit—a quasi-judicial decision—could be addressed at a later time and could be issued by the board of adjustment or the planning board rather than the governing board. However, the typical practice was to consider the rezoning and the permit at the same time, with both decisions made by the governing board.[3]
This technique of CUD zoning was pioneered by Greensboro in 1972 and then authorized by local legislation for several local governments in 1973. It was incorporated into the general zoning-enabling act in 1985.
The statutory authority for use of this tool was, however, eliminated in 2019. G.S. 160D-703 now provides that a zoning regulation may have legislative conditional zoning. It may also have quasi-judicial special use permits. But it may no longer combine the two into one process and decision.[4]
Authority for Use of Conditional Zoning
In two cases arising in Charlotte, the court approved the use of purely legislative conditional zoning, without a concomitant special use permit, for North Carolina local governments.
The first case, Massey v. City of Charlotte,[5] involved the rezoning of a forty-two-acre parcel from R-3 to commercial-center district to allow construction of two “big box” retailers along with five outparcels. The trial court held that while the city could undertake the two-step CUD zoning described above, the city had no authority to undertake “conditional zoning” without using a conditional use permit (and following the requisite procedure for those permits).
In response to this ruling, while the case was on appeal, Charlotte, Mecklenburg County, and the other cities within the county obtained local legislation authorizing conditional zoning without having a quasi-judicial special use permit as part of the process. These bills allowed creation of “conditional zoning districts” with individualized development standards adopted as part of the ordinance. Property could only be rezoned to these districts “in response to and consistent with” a petition filed by the property’s owner. The petition was required to include a site plan, a specification of the actual use planned, and any rules, regulations, or conditions that would govern development of the site. The petitioner was required to conduct at least one community meeting on the proposal prior to the official hearing on the rezoning. The rezoning decision would be made “in consideration of” relevant land use plans for the area, including the comprehensive plan, strategic plans, district plans, area plans, neighborhood plans, corridor plans, and other land use–policy documents. These rezonings would not be made between the date of election of a new governing board and the time that the new board took office.
When the Massey case reached the court of appeals, the court held that the zoning-enabling statutes authorized use of CUDs but did not mandate their use or by implication limit the use of other types of zoning decisions (such as the purely legislative conditional zoning used here), especially when these statutes were read with the mandate for broad construction in mind.[6] The court noted that Chrismon did not explicitly require an accompanying quasi-judicial decision.[7] The court also held that the petitioner’s submission of detailed plans for site development did not constitute illegal contract zoning because this was a unilateral promise from the petitioner, not a bilateral agreement with obligations being made by the city. The court held that the appropriate standard of judicial review for conditional zoning was that applicable to legislative decisions.[8]
The second case addressed the constitutional dimensions of conditional zoning. In Summers v. City of Charlotte,[9] the court again held that conditional zoning decisions are legislative rather than quasi-judicial and are within the statutory authority delegated to the city. The court also found that the mandatory community meetings and formal legislative hearing provided in the course of the rezoning process afford neighbors adequate procedural due process.[10] The court held that the rezonings were not arbitrary and capricious, as they were based on fair and careful consideration of the planning board’s review, technical staff reports, and public comments. The court noted that the rezonings were consistent with adopted small-area plans for the affected area and that there was no showing of bad faith or undue discrimination.
In 2005, the General Assembly amended the zoning statutes to explicitly authorize city and county use of conditional zoning.[11] G.S. 160D-703 provides that zoning ordinances may include “conditional districts, in which site plans and individualized development conditions are imposed.” Land may be placed in a conditional district only upon petition of all of the owners of the land to be included.
The use of conditional zoning rapidly became commonplace in North Carolina following the Massey decision, particularly for municipalities. A 2006 School of Government survey of North Carolina cities and counties indicated that a third of the responding cities and a quarter of the responding counties used conditional zoning. In a 2018 survey, well over half the responding cities and conties reported using conditional zoning. The responding jurisdictions reported that 57 percent of all rezonings considered in the past year were conditional rezonings.[12]
The standard practice in North Carolina cities and counties using conditional zoning is to amend the ordinance text to create a set of conditional districts to correspond with each conventional zoning district. However, rather than requiring that all uses secure a special use permit, as was done with CUD zoning, individualized conditions and site plan provisions are incorporated (usually by reference) into the zoning-district requirements for any property rezoned to a conditional district. In most instances, the provisions in the conditional district are more stringent than those in the corresponding conventional districts. The conditional district may, for example, have a much narrower list of permitted uses and may increase the buffering requirements to provide additional protection to neighboring uses. In the absence of a local ordinance provision to the contrary, it is, however, legally permissible to tailor standards that are less restrictive than those in the corresponding conventional district.[13]
While the North Carolina courts have consistently held site-specific conditional zoning cases to be legislative, it is important to note that many of these rezonings constitute spot zoning. As such, the presumption of validity usually accorded legislative zoning decisions is removed, and the burden is on the local government to establish a reasonable basis for the rezoning.
Permissible Conditions
G.S. 160D-703(b) addresses the origin and nature of conditions that may be imposed.
This statute provides that specific conditions may be suggested by the owner or the government, but only those conditions mutually acceptable to both the owner and the government may be incorporated into the ordinance.[14] The statute was amended in 2019 to specify that the owner’s consent must be in writing.[15] If an owner objects to being in a conditional district, the local government cannot put the property in one. If an owner objects to a proposed condition, it cannot be included. If the owner objects to a particular condition, the local government has the choice of approving the conditional zoning without the objectionable condition or denying the conditional rezoning if the governing board concludes that rezoning without that condition would be inappropriate.
The statute also provides that any conditions or site-specific standards imposed are limited to those that address the conformance of the development and use of the site to city or county ordinances and officially adopted plans and those that address the impacts reasonably expected to be generated from the development or use of the site. In addition, the general statutory and constitutional limits on factors that can legitimately be considered in any rezoning also apply to the conditional rezonings. So, for example, a condition could not be imposed that discriminates on the basis of race, ethnicity, or religion.
G.S. 160D-703(b) further provides that no condition may be imposed that is not otherwise authorized by law, including taxes, impact fees, building-design standards for one- and two-family residences, and driveway-related improvements not authorized by law unless consented to in writing by the owner.[16]
Another means of securing and documenting written landowner consent is the use of a concurrent development agreement with the conditional zoning. Where there is substantial cost-sharing on infrastructure to support the proposed development or there is a voluntary provision of extra public benefits, many local governments and landowners use a development agreement in conjunction with conditional zoning. A condition included in a conditional zoning can require compliance with all the terms and conditions of an accompanying development agreement. G.S. 160D-1003(b) allows a development agreement to be incorporated into a zoning regulation and for the development agreement and a rezoning to be considered concurrently. G.S. 160D-1006(d) allows a development agreement to include mutually acceptable provisions for financing public facilities, provided that any measures offered by the developer beyond those that could be required by the local government are expressly set out in the agreement. While these additional measures in a development agreement cannot include a tax or impact fee not otherwise authorized, they can include a wide range of possible conditions, including donations of land and construction of public and community facilities. These items cannot be mandated unilaterally by the local government but can be included with the voluntary written consent of the landowner.
The limit of G.S. 160D-703(b1), added to the statutes in 2021, may be applicable to conditional zoning. This statute provides that where multifamily structures are an allowable use, a harmony requirement may not be imposed if the development includes affordable housing. On its face, this limitation only applies to a harmony requirement for “permit approval.” A rezoning to a conditional district is a legislative decision, not a permit approval. However, the placement of this limit in G.S. 160D-703, which is the section of the statutes on zoning districts, implies that it may be applicable to conditional-zoning decisions as well as to special use permits. As a practical matter, if the governing board believes harmony or neighborhood compatibility is an important factor in a pending rezoning, be it conditional or conventional rezoning, that is factored into the decision on whether or not to approve the rezoning in the first place, not as a separate finding to be made at a later date.
Conditions Typically Imposed
Not surprisingly, the two most used conditions are ones that limit the range of permitted uses and that require a detailed plan for future development of the site. Both types of conditions are permissible in North Carolina. Over 70 percent of the jurisdictions responding to the School of Government’s 2018 survey reported that their conditional zoning either always or frequently included these two conditions.
Use Restrictions. A conventional zoning district typically allows dozens of different land uses. Some of those uses may have modest land use impacts for the neighbors, while others might be problematic in a particular setting. A condition imposed on a conditional zoning can allow a specific use on a specific parcel that the owner desires while ruling out other uses that are objectionable to the neighbors or local government if placed on that property. A condition can expand the range of permitted uses, such as allowing a range of mixed uses within a building or allowing a wider range of uses within a larger site, but it more often restricts the uses that would have been allowed in a comparable conventional zoning district. Some zoning regulations allow only conditions that are more stringent than those in the corresponding conventional zoning district while others allow any modifications deemed appropriate. State law allows either approach.
Site plans. A site plan incorporated into a conditional rezoning can identify where roads, buildings, parking, particular uses, and buffers will be located. It can provide information on landscaping or stormwater management, although details on these aspects of the development may be addressed later in the permitting process. Securing agreement on the site plan for the forthcoming development at the rezoning stage provides clarity for the owner, developer, and neighbors as to how the development will proceed. It shows how potential adverse impacts will be addressed and minimized.
Site development details. A related set of permissible conditions are often used to address more specific aspects of the potential development. While not quite as frequently employed as the two conditions noted above, over 50 percent of jurisdictions responding to the School of Government’s 2018 survey reported frequently using these types of conditions.[17]
While a commercial district might require that buildings have a twenty-five-foot setback from the rear property line, a conditional district could increase that to a fifty-foot rear-yard setback to address potential negative impacts on neighboring residential properties. Alternatively, the setback could be reduced to ten feet if that was an adequate distance for the particular development and setting. It could require a solid fence, specified landscaping, or restrictions on exterior lighting to buffer the back of the commercial development from its neighbors. How streets within the development connect to neighboring streets can be specified. A condition could set a maximum density of future residential development to assure that there are adequate streets, utilities, schools, and recreational facilities. The design of buildings can be specified to assure harmony with their surroundings, as can the precise location of the buildings, parking, and support facilities. G.S. 160D-702(b) allows the imposition of building-design standards even on single-family homes if that is voluntarily consented to by all the owners during the process of seeking rezoning approval.
Infrastructure. For some developments, particularly those that are very large, securing adequate supporting infrastructure is a key consideration in development approval. The location, construction standards, and financing of roads, utilities, schools, parks, and greenways are important for both the developer and the local government. Details on how this is to be accomplished can be incorporated into the conditions included in a conditional rezoning. These types of conditions are permissible but are less commonly imposed.
Social equity. A final set of conditions that are sometimes considered are those that address social equity concerns. While common in some states, this type of condition has to date not been frequently applied in North Carolina. However, they may be proposed to secure plan compliance or to address impacts of the development. For example, some North Carolina comprehensive plans call for a full range of housing affordability in new developments. Other plans may address the need for more affordable and work-force housing. In response, some conditional zonings and development agreements have included provisions for a specified amount of affordable housing or a commitment to make payments to a local affordable-housing trust fund.
Amendment of Conditions
An amendment to the conditions included within a conditional zoning is a text amendment to the ordinance that generally must go through the entire ordinance-amendment process. For example, in McDowell v. Randolph County,[18] the landowner proposed to relocate chemical vats in a lumberyard that was in a conditional district. The site plan for the lumberyard had been incorporated as a condition in the conditional zoning. So the site-plan amendment was considered a zoning-text amendment subject to the public-hearing, planning-board-review, and plan-consistency-statement requirements applicable to any zoning amendment.
The statutes provide an exception to this rule. G.S. 160D-703(b) gives local governments the option of processing minor amendments administratively. To use this option, the ordinance itself must define what constitutes a “minor modification.” A minor modification cannot include a change in permitted uses or in the density of the overall development. Once defined, staff can be authorized to approve minor modifications administratively. Any other modification must follow the same process for approval as is required for a zoning-map amendment. If conditional district applies to multiple parcels of property, the conditions may be modified for individual parcels without the necessity of obtaining the consent of all property owners within the conditional district, but in those instances the modification only applies to the parcels whose owners consent.
Related Blog Posts
What Conditions Can Be Included in Conditional Zoning? (11/2021)
[1]. 6 N.C. App. 102, 169 S.E.2d 487 (1969).
[2]. 145 N.C. App. 222, 551 S.E.2d 186 (2001).
[3]. While the statutes did not mandate concurrent hearings and decisions, that was the near-uniform practice of jurisdictions employing this tool. The standard practice was to consider them together, with either the rezoning and the permit approved at the same time or the rezoning denied (leaving no need to rule on the permit application).
[4]. Section 2.9(b) of S.L. 2019-111 addressed the transition for CUDs created prior to the effective date of Chapter 160D. Any CUD or special use district becomes a conditional district. Any special or conditional use permit issued as part of those approvals remains valid and is deemed a special use permit after that date.
[5]. 145 N.C. App. 345, 550 S.E.2d 838, review denied, 354 N.C. 219, 554 S.E.2d 342 (2001).
[6]. Massey, 145 N.C. App. at 353–55, 550 S.E.2d at 844–46.
[7]. On the contrary, the Massey court noted,
[n]othing in Chrismon suggests that the Board [of County Commissioners] engaged in a two-step, part legislative, part quasi-judicial process which would warrant the “competent and material evidence” standard of review. Rather, the re-zoning decision and the decision regarding the conditional uses that would be allowed on the land were determined in a single proceeding.
145 N.C. App. at 351, 550 S.E.2d at 843.
[8]. The court cited the Chrismon standard that the rezoning be upheld if it is “reasonable, neither arbitrary nor unduly discriminatory, and in the public interest.” Id. at 349, 550 S.E.2d at 842. See also Ashby v. Town of Cary, 161 N.C. App. 499, 588 S.E.2d 572 (2003) (CUD rezoning is to be overturned only if it has no foundation in reason and bears no substantial relationship to the public health, safety, morals, or welfare).
[9]. 149 N.C. App. 509, 562 S.E.2d 18, review denied, 355 N.C. 758, 566 S.E.2d 482 (2002). This case involved neighbors’ challenges to two Charlotte rezonings. The first rezoned 11.6 acres from an office district to a mixed-use-development district allowing offices, retail establishments, multifamily residences, and a hotel. The second rezoned the 95.6-acre site of SouthPark Mall from shopping-center and office districts to a commercial-center district. Both rezoning petitions included site plans, specifications of proposed uses, and proposed site-specific development guidelines. After a series of public meetings and a legislative hearing, the city adopted both rezonings. In each rezoning the council specified that the general zoning-ordinance provisions for the respective districts, the site plans, and the additional individualized proposed regulations and conditions all constituted the binding zoning regulations for each property.
[10]. In most situations procedural due process is not an issue in legislative rezoning decisions, as neither the owner nor the neighbors have a property right in the existing zoning. Here, the court noted that procedural due process only applied if a party’s vested property rights were affected, and “even assuming Plaintiffs have a vested right,” the notice and hearing procedures used for legislative zoning decisions were adequate. Summers, 149 N.C. App. at 518, 562 S.E.2d at 25.
[11]. S.L. 2005-426, §§ 6(a), (b).
[12]. The use of conditional zoning is even more pronounced in municipalities with larger populations. Cities with populations over 25,000 reported that 79 percent of their rezonings were to conditional districts. David W. Owens, 2018 Survey Report: Adoption and Administration of Local Development Regulations, Conditional Zoning, and Subdivision Administration, Plan. and Zoning L. Bull. No. 30 (UNC School of Government, Dec. 2020), at 17.
[13]. Rakestraw v. Town of Knightdale, 188 N.C. App. 129, 136, 654 S.E.2d 825, 830, review denied, 362 N.C. 237, 659 S.E.2d 739 (2008).
[14]. Of course, if a proposed condition is unacceptable to the owner, the petition can be withdrawn and the proposed rezoning cannot go forward. Likewise, if a condition is unacceptable to the governing board (or the owner refuses to agree to a desired condition), the petition can be denied and there is no rezoning.
[15]. If written consent is not provided to the local government at the time of adoption of the conditional zoning, a common practice is to add a provision that the zoning is not effective until written consent from the owner is delivered to the local government (which often must be done within a specified time, such as within 10 days of adoption). Several local governments require an affidavit from the owner; many allow a signed letter of acceptance of the conditions.
[16]. The regulation also should be clear that the owner has the option to reject the conditions, as consent must be voluntary. Similarly, the regulation should be clear about the implications of rejection of the conditions, for example noting that If rejected, the conditional rezoning is not effective and the prior zoning remains in place.
[17]. Id. at 19–20.
[18]. 256 N.C. App. 708, 808 S.E.2d 513 (2017).
