Tuesday, May 14, 2013

TNCPA §208(c): Expanding NCFPs & Constructing new facilities

We’ve been talking about the Tennessee Non-Conforming Property Act, Tenn. Code Ann. §13-7-208, and in our last post, we talked specifically about §208 (b) which allows a non-conforming property to continue its non-conforming activities. Today, we’ll take a look at §208 (c), which allows non-conforming property to expand its operations and even construct additional facilities so long as there is no change in the use of the property.

Section 208 (c) allows the expansion of the non-conforming property, including the construction of additional facilities as desired for expansion. It is important to note that under this subsection, there is no requirement that the expanded facilities comply with other bulk regulations such as front, side, and rear setbacks. The expansion may go so far as desired so long as it does not create a nuisance to adjoining landowners. So, to the extent that there may be other regulations in the zoning ordinance which might restrict the expansion, those do not apply. This provision specifically prevents a local government from denying a building permit when a commercial or industrial business seeks to expand its current operations.

There is one important restriction on this right to expand: under §208 (h) off-site signs are not permitted to expand beyond certain dimensions specified in the statute. This section does make clear that the protective provisions of the act do apply to off-site signs, and it even defines such signs as “any sign that advertises or gives direction to any business, product, service, attraction or any other purpose or interest, other than the industrial, commercial or other business establishment located on the site where the sign is located.” Thus if you represent a sign interest, these restrictions are of significant importance.

Since §208 (h) limits only the size of off-site signs, presumably the expansion of an on-site sign is permitted without limitation, so long as the sign does not need to be destroyed and entirely rebuilt (see §208 (d) which we will discuss in our next entry). For example, if the structure holding the sign face aloft remains, and the sign face is replaced with a larger sign face, this would appear to be an expansion under §208 (c), and no matter how much larger the sign face of the on-site sign happens to be, it is permitted (unless it’s so big that it causes a nuisance to adjoining property owners).

Let’s take another example of the application of this section of the statute. Assume that you own a funeral home and while at the time of its initial construction, the property was owned for that use, the zoning is now changed in the mortuary is legally non-conforming. However, you want to expand the services provided by the funeral home by including cremation, which means that you will have to add a crematorium. Unfortunately, the local zoning ordinance does not allow a crematorium in the zoning district where you are located, just as it doesn’t allow the funeral home itself. In fact, a crematorium is permitted only in the industrial zoning district in your city. Does §208 (c) allow the expansion of the funeral home by the construction of a crematorium? It does.
Clearly, the funeral home is a commercial business establishment and also clearly under the terms of our hypothetical, it was in operation and permitted operate before the zoning changed making it legally non-conforming. Under those circumstances, §208 (c) says that the commercial business establishment “shall be allowed to expand operations and construct additional facilities which involve an actual continuance and expansion of the activities of the… business which were permitted and being conducted prior to the change in zoning…” Given the language of the statute, the only remaining question would be whether the construction of a crematorium involves a continuation and expansion of the mortuary services. Probably no one would disagree but that cremation is a mortuary service and thus the expansion is permitted. This is exactly what happened in BMC Enterprises v Mt. Juliet,  273 S.W. 3d 619 (Tenn. App. 2008; perm app den Oct 27, 2008). This case is interesting not just because it is a good example of the application of §208 (c), but in addition it involves what would seem to be a fairly significant expansion in the operations of the mortuary and significant construction of additional facilities. Finally, this was all done in the face of an outright prohibition by the city zoning regulations .

Finally, I cannot be emphasized enough that the expansion in business operations and construction of additional facilities must all relate to the same business use. If the use changes as a byproduct of the construction of additional facilities, then §208 provides no protection. A good example of this was a bed-and-breakfast in Winchester, Tenn., which applied for and received permission to expand its operations ostensibly to allow for modest dining facilities for guests and friends. The expansion however turned out to be a bar with live entertainment. The Tennessee Court of Appeals had no difficulty whatsoever in concluding that §208 offered no protection in the face of the change in use. Lafferty v Winchester, 46 S.W. 3d 752 (Tenn. App. 2000).

One final issue that is worthy of investigation here is by what standard is the land use evaluated. For example, in the Mt. Juliet case, should we look to the local zoning regulations to determine what a funeral home is, or should some other standard apply? The courts really haven’t reached a decision with regard to this issue, although in BMC Enterprises, the court did note that the local zoning regulations did not have a definition of funeral home, and as a result it looked to Tennessee state law for a definition.

Some land uses are defined in § 208 itself, such as the definition of off-site signs in §208 (h). Certainly it seems to me that since the Non-Conforming Property Act applies across the entire state of Tennessee (with certain limited statutory exemptions which we will review in a post later in this series), that there should be general definitions applicable across the state and not grounded in local zoning provisions. Otherwise, and expansion which is permitted in Mt. Juliet might not be permitted in Gallatin. Surely, this state limitation on local zoning powers should apply across local government boundaries to allow commercial and industrial businesses to continue operation, expand operations, and destroy and rebuild their facilities in like manner no matter where they are located. I’m sure that the Tennessee appellate courts will address this issue sometime in the not-too-distant future and will get an answer to this somewhat perplexing question.

Next time, we'll discuss §208(d) of the TNCPA, one of the most interesting provisions of the statute.

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