Agenda - Planning Commission - 03/03/2016

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Zoning Bulletin January 25, 2016 1 Volume 10 1 Issue 2 ity, 807F.3d 62 (4th Cir. 2015) The Fourth Circuit has jurisdiction over Maryland, North Carolina, South Carolina, Virginia, and West Virginia. FOURTH CIRCUIT (NORTH CAROLINA) (12/1/15)—This case ad- dressed the issue of whether a county acted ultra vires beyond its statu- tory authority—in collecting fees from a subdivision developer for water and sewer services that were not provided, were not immediately available for provision, and were not concretely planned for provision. The Background/Facts: Tommy Davis Construction, Inc. ("TDC") was developing a residential subdivision with 29 lots, located on Cape Fear, in the southern part of New Hanover County (the "County"). In Feb- ruary 2005, TDC applied for building permits from the County for a few lots in the subdivision. The County advised TDC that it was required to pay "impact fees" to the County Water and Sewer District (the "District") before the County would issue the building permits. The County Board of Commissioners had created the District as a public utility in 1983 to provide water and sewer services to the unincorporated areas of the County. The District, however, did not offer service throughout its entire jurisdiction. Portions of the County, including the area where TDC's subdivision was located, were instead served by private water and sewer utilities. Even though the Water and Sewer District did not offer ser- vice to every area within its jurisdiction, it nonetheless assessed, and the County collected, impact fees for all new development in every area, including the area of TDC's subdivision. In assessing those fees, the County relied on an ordinance that required "[a]ll new development . . . obtaining a certificate of occupancy" to pay a "facility fee . . . based on average daily flow" as a "[o]ne-time sewer charge [ 1." (New Hanover County, N.C., Code § 56-312(b) (2005).) According to the County, the impact fees were used "to develop [the County's] wastewater infrastructure with the goal of providing expanded service coverage in the unincorporated areas of [the County]." TDC objected to the fees because the Water and Sewer District was not going to be providing water and sewer services to its subdivision and it had already paid impact fees to a private water and sewer utility provider. Eventually, TDC paid the fees under protest so that it could proceed with the subdivision's development. Between March 2005 and July 2006, it paid $34,268.96 in impact fees to the District to build houses on 23 lots. In 2007, the Cape Fear Public Utility Authority (the "Authority") as- sumed all the rights and liabilities of the District and began operating the region's public water and sewer infrastructure. In 2010, TDC requested that the Authority refund the impact fees that it had paid. The Authority denied the request. TDC then sued the Authority and the County, seeking a refund of the impact fees it had paid in 2005 and 2006. TDC alleged that the County's actions in collecting impact fees were ultra vires—beyond its statutory authority. Under North Carolina statutory law—N.C.G.S.A. § 162A-88— ©2016 Thomson Reuters 3