By:   Biff Craine
Bricklemyer Smolker & Bolves, P.A.

August 2009

Introduction

During the 2009 legislative session, two pieces of legislation affecting Florida’s Growth Management Laws were passed - SB 360 known as the Community Redevelopment Act and HB 1021 which has impacts on the way traffic studies will be conducted.

Holders of DRI Development Orders in areas defined by SB 360 as Dense Urban Land Areas (or “DULA”) instantly have choices created by SB 360.  This article is about those choices.

SB 360

There has been much confusion over what SB 360 does and what it allows to be done.  Things that many supporters and proponents of the legislation thought SB 360 did were filtered through the lens of DCA Secretary Tom Pelham, who has issued statements as to what the Department believes SB 360 does and allows local government to do.  Secretary Pelham was quick to point out at the 2009 Department’s Growth Management Implementation Workshop in late June that SB 360 was his agency’s to implement and the agency’s interpretation of the act would be given “great deference” by the courts.

Notwithstanding alternative interpretations or possible legal challenges to interpretations made by the DCA Secretary, issues with regard to SB 360’s effect on DRI review are somewhat less confusing, and under almost any interpretation offers DRI developers alternatives worth exploring.

DULAs were designated by the Department and will be areas within 8 of the most urbanized counties in Florida (Dade, Broward, Duval, Hillsborough, Orange, Pinellas, Palm Beach and Seminole) as well as over 200 municipalities.

New Transportation Concurrency Exemption Areas (“TCEAs”) are created by the legislation, the immediate effect of which is the removal of state mandated concurrency requirements.  Although there are arguments to the contrary, the consensus is that policies establishing transportation concurrency requirements found within local comprehensive plans live on until those policies are changed by the local government.  In other words, nothing happens to transportation concurrency until it happens by action of those local governments that qualify for the new TCEAs.

With few exceptions, DRIs within DULAs may be kept by developers, modified or relinquished.  DRIs that are under review may be withdrawn from the DRI process and DRI sized projects yet to apply in DULAs need not apply to go through the DRI process – they are exempt.  For DRI developers, struggling with the cold reality of these economic times, these options should be carefully evaluated. It may be worth the time and expense to reanalyze existing transportation mitigation requirements, either within the DRI regulatory framework or outside the burdens of that framework.

The legislature provided one more tool to factor into these evaluations – HB 1021.  HB 1021 is a bill which traveled well below the radar screen which was lit up with controversy over SB 360.  HB 1021 deals with, among other issues, the scale of transportation mitigation that can be properly assessed to development.

Among the provisions of HB 1021 that need to be closely scrutinized for their effects on transportation mitigation costs are the new, clear definitions of what a backlogged facility is.  It has long been law that a DRI is only responsible for its “proportionate share” of the improvements required to the transportation system, not for the additional cost of reducing or eliminating backlogs.”  Now we have a clear expression by the legislature as to what a “backlog” is: “backlog means a facility or facilities on which the adopted level-of-service standard is exceeded by the existing trips, plus additional projected background trips from any source other than the development project under review that are forecast by established traffic standards, including traffic modeling…”

What does this new definition mean?  Potentially, expensive costs assessed to a project as part of its proportionate share to expand backlogged facilities may be reduced or in some cases eliminated.  How does this work?  Here’s an example.

XYZ DRI has 20% of its traffic distributed on ABC highway, a four lane divided arterial which is operating below its desired level of services.  Current methodology causes an improvement to ABC highway to be triggered, adding a 5th and 6th lane to accommodate XYZ’s traffic at the desired level of service.  XYZ is charged a share of that fix as part of that proportionate share calculation.

Under the new backlog definition, ABC is a backlogged facility.  Since, by law, XYZ DRI is not required to reduce or eliminate backlogs, two interpretations seem plausible.  First, because the 5th and 6th lanes are already required to fix this backlogged facility, the DRI may not be required to pay a proportionate share for those improvements.  A second plausible alternative interpretation could be XYZ DRI is only responsible for not making ABC Highway worse than its current backlog status, meaning XYZ DRI can propose capacity improvements to maintain the volume to capacity ratio (V/C ratio) rather than a share of the 5th and 6th lanes to “fix” ABC Highway and raise it to the desired levels of service.

Putting dollars and cents to this equation, let’s assume the 5th and 6th lane improvement to ABC Highway costs $80 million and XYZ’s share is 20% or $16 million.  Let’s also assume that by extending acceleration and deceleration lanes at the project and adding left turn lanes at two nearby intersections maintain the V/C ratio.  The cost for these intersection and access improvements are $6 million to allow no further degradation of the backlogged facility.  100% of the $6 million is much less than 20% of $80 million.  The potential savings could be $10 million of proportionate share dollars or $16 million if no contribution to the backlogged facility is required.

Summary

SB360 and HB 1021 demand that a prudent DRI developer consult his legal counsel and transportation consultants to evaluate whether these new laws offer opportunities to reduce his project’s transportation mitigation requirements.  This is especially true based on the current, substantially lower growth projections as compared to those that have been assumed in the past.