DEVELOPMENT AGREEMENTS "freeze" land use rules, regulations,
and policies in effect at a particular point in time. Subsequent
legislative amendments or enactments then don't apply to the project
that's the subject of the agreement. Locking in the rules protects
the project from application of those rules in a manner that prevents
the construction of the project. It also confers vested rights
to proceed with an approved development.
PRACTICE TIP: To avoid potential validity problems of the development
agreement, make sure it: (1) adheres to the city's general plan
and to the principle that the development agreement and the project
must be consistent with the general plan; (2) adheres to the goals,
purposes, and procedures set forth in the development agreement
statute; and (3) demonstrates that the agreement constitutes a
present exercise of governmental authority rather than a deferral
or an abdication of that authority.
PRINCIPAL PROVISIONS of the development agreement statute are
set forth below.
*Cities are given express authorization to enter into a development
agreement and may adopt procedures to do so by resolution or ordinance.
Gov't
Code § 65865.
*The development agreement shall be enforceable by any party
thereto, notwithstanding any change in any applicable general
or specific plan, zoning, subdivision, or building regulation
adopted by the city. Gov't Code § 65865.4.
*Unless otherwise provided by the development agreement, the
applicable rules, regulations and policies shall be those which
are in force at the time of the execution of the agreement. Gov't
Code § 65866.
*A development agreement is a legislative act which must be approved
by ordinance, be consistent with the general plan and any specific
plan, and is subject to repeal by referendum. However, the opportunity
for such repeal expires 30 days after the city's adoption of the
ordinance approving the agreement, and thereafter the project
is immune to subsequent changes in zoning ordinances and land
use regulations which are inconsistent with those provided for
in the agreement. Gov't Code § 65867.5.
*The city may terminate or modify a development agreement if
it finds and determines, on the basis of substantial evidence,
that the applicant or successor in interest thereto has not complied
in good faith with its terms or conditions. Gov't Code § 65865.1.
*A city is authorized to enter into a development agreement
for property outside the city limits but within its sphere of
influence; the development agreement, however, does not become
operative until annexation proceedings are completed within the
period of time specified by the agreement. Gov't Code § 65865(b).
*If, prior to incorporation of a new city (or annexation to a
city), a county has entered into a development agreement with
the developer, that development agreement shall remain valid for
the duration of the agreement, or for 8 years from the effective
date of the incorporation or annexation, whichever is earlier,
or for up to 15 years upon agreement between the developer and
the city. Gov't Code § 65865.3.
This statute applies to incorporations where the development
agreement was applied for prior to circulation of the incorporation
petition and entered into between the county and the developer
prior to the date of the incorporation election. Id. The statute
also allows the newly incorporated or annexed city to modify or
suspend the provisions of the development agreement if it finds
an adverse impact on public health or safety in the jurisdiction.
Id. However, as to annexations, if the proposal is initiated by
a petitioner other than a city, the development agreement is valid
unless the city adopts written findings that implementation of
the development would create a condition injurious to the public
health, safety or welfare of the city's residents.
