The 2019 Legislative Wrap-Up

If I had to sum up the 2019 Legislative Session for the home building industry in one word, OUTSTANDING! The tenor of the House and Senate begin with the appointed leaders, House Speaker Jose Oliva and Senate President Bill Galvano. A big thank you to both of them for fostering a free-market environment that recognizes local governments can and do over-reach when it comes to regulations and fees on new construction. Also, none of these would pass without the support of Rules Chairs Rep. Sprowls and Sen. Benacquisto.

For those of you who attended Spring Conference and passed out the legislative leave behind, here is an updated, post-session version. A check next to the priority indicates accomplished! Click here to view the post-session leave behind.

Below is a summary of the major FHBA priorities. Please keep in mind, this summary is preliminary, pending a comprehensive review of all the passed bills and adopted amendments from the final days. This is only a summary of issues appearing on our legislative leave behind. Please stay tuned for additional materials for updates and discussion of other relevant issues.

Impact Fees

CS/HB 207 by Representative Donalds – (SB 144 by Senator Gruters)

As one type of regulatory fee, impact fees are charges imposed by local governments against new development to provide for capital facilities’ costs made necessary by such growth. Examples of capital facilities include the provision of additional water and sewer systems, schools, libraries, parks and recreational facilities. Impact fee calculations vary from jurisdiction to jurisdiction and from fee to fee. Impact fees also vary extensively depending on local costs, capacity needs, resources, and the local government’s determination to charge the full cost or only part of the cost of the infrastructure improvement through utilization of the impact fee.

SB 144 prohibits local governments from requiring the payment of impact fees prior to issuing a property’s building permit. The bill also codifies the ‘dual rational nexus test’ for impact fees, as articulated in case law. This test requires an impact fee to have a reasonable connection, or rational nexus, between 1) the proposed new development and the need and the impact of additional capital facilities, and 2) the expenditure of funds and the benefits accruing to the proposed new development.

Additionally, the bill requires any impact fee ordinance earmark impact fee funds for capital facilities that benefit new residents and prohibits the use of impact fee revenues to pay existing debt unless specific conditions are met. The bill provides that certain statutory provisions related to impact fees do not apply to water and sewer connection fees.

If approved by the Governor, these provisions take effect July 1, 2019.

Vote: Senate 39-1; House 101-12

Key Legislators Helping: Reps. Donalds, La Rosa, and Ingoglia and Sens. Gruters, Flores, and Hutson

Property Development

House Bill 7103 by Fischer – (HB 1730 by Senator Lee)

The bill contains the impact fee provisions of HB 207 (see above) and:

  • Restricts counties and municipalities from imposing certain mandatory affordable housing ordinances.
  • Imposes time limits for a county or municipality to review applications for development orders or permits and provides procedures for addressing deficiencies.
  • Allows parties to a development order challenge to use summary proceedings under s. 51.011, F.S.
  • Expands the scope of work for private providers who review site plans and inspect buildings.
  • Reduces the time from 30 business days to five business days for building departments to review permit applications when a private provider approves the plans.
  • Limits local government’s authority to audit a private provider to four times annually and prohibits a building official from replicating plan reviews or inspections done by a private provider.
  • Allows one hiring a private provider to seek judicial relief for noncompliance with the law.
  • Amends how local governments impose or give credits for impact fees and clarifies that water and sewer connection fees are not governed as impact fees.
  • Authorizes local governments to exempt or waive impact fees for affordable housing projects.
  • Requires mobility fee-based funding systems to be governed by the impact fee statutes.
  • Requires credits for required contributions for public educational facility development be allocated to reduce applicable impact fees on a dollar-for-dollar basis at fair market value for the entire impact fee imposed rather than just those exactions imposed for a specific educational facility.
  • Requires municipal comprehensive plans adopted after January 1, 2019, and their corresponding land development regulations, to incorporate the terms of existing development orders.
  • Prohibits a municipality from purchasing or annexing real property within the boundaries of another municipality without the latter’s consent.
  • Limits the tolling and extension of time to exercise rights under a development order, building permit, certain environmental permits, or the buildout date for a development of regional impact to the time covered by declaration of a state of emergency by the Governor for a natural emergency.
  • Provides legislative findings about the need for to develop affordable workforce housing and creates a new definition for “essential services personnel.”

Effective Date: July 1, 2019

Key Legislators Helping: Reps. Fischer, La Rosa, and Ingoglia and Sens. Lee, Hutson, Flores and Simpson,

Alternative Graduation Pathway for Career and Technical Education

HB7071 by Representative Mariano – (SB 770 by Senator Hutson)

The bill provides an alternative graduation pathway for kids seeking a future in technical and career fields. The bill specifies that a student may earn two mathematic credits by successfully completing Algebra I through two full-year courses. This means that the student would be able to meet all mathematic credit requirements by completing two credits in Algebra I, one credit in Geometry, and earning an industry certification that may be substituted for another mathematics credit. Career Education Courses That Satisfy High School Graduation Requirements. The bill also requires the State Board of Education to determine, at least biennially, if sufficient academic standards are covered in career education courses to warrant the award of academic credit, including satisfaction of assessment requirements. The bill also requires the instructional methodology used for these courses to emphasize workplace skills, including reading for information, applied mathematics, and locating information, emphasized by the Florida Ready to Work Certification Program.

The bill also sets requirements for the Scholar High School Diploma Designation. The bill revises the mathematics requirements to earn the Scholar high school diploma designation so that students, in lieu of earning a credit in Algebra II, can earn a credit in an equally rigorous course. Academically Challenging Curriculum to Enhance Learning Options (ACCEL). The bill authorizes the required three electives under the ACCEL graduation pathway to include credits in work-based learning and career and technical education resulting in program completion and an industry certification.

The bill specifies that a high school student may be included in the school grades acceleration component if he or she earns college and career credit by completing career clock-hour dual enrollment courses totaling 450 or more hours that are identified by the SBE or who successfully completes a registered preapprenticeship program with a minimum length of 300 hours.

In addition to the “Academic Scholarship Signing Day,” the bill authorizes school districts to declare a “College and Career Decision Day” to recognize high school seniors for their postsecondary education plans, encourage early preparation for college, and encourage students to pursue advanced career pathways through the attainment of industry certifications.

Key Legislators Helping: Reps. Donalds, Massullo, and Mariano and Sens. Hutson, Perry and Diaz

Excess Permit Fees/Open Permits

House Bill 447 by Diamond – (Senate Bill 902 by Perry)

The bill, which until the final days of session related solely to establishing a methodology for closing open permits, was amended to include the FHBA Excess Permit Fee Bill.

The bill provides that local government excess building permit funds may not exceed the average of the prior 4 year’s operating funds. There is an exception for a jurisdiction that statutorily created, as of January 1, 2019, an advisory committee of stakeholders who pay into the fund and that committee approves of maintaining funds in excess of the specified amount. Any carryover funds exceeding the 4 year average must be used to lower fees or be rebated.

The bill also prohibits local governments from attaching surcharges unrelated to enforcing the building code.

Lastly, the FHBA priority provisions provide that a 558 (right to cure claim) does not toll the 10-year statute of repose. In essence, this provision takes us back to how the law was interpreted prior to the recent Centex case.

With respect to its original intent, the closing of open permits, the bill provides that local governments may:

  • Send written notice, by mail or e-mail, to the owner of the property listed on a building permit, and the contractor who was issued the permit, that a building permit is about to expire. If the local government decides to send the notice, it must send the notice no less than 30 days before the permit expires.
  • Close a building permit 6 years after the issuance of the permit, and even in the absence of a final inspection, if the local enforcement agency determines that there are no apparent safety hazards.

The bill provides that local governments may not:

  • Penalize an arms-length purchaser of property solely because a previous owner failed to close a building permit for the property.
  • Deny a contractor a permit solely because the contractor has expired building permits.

The bill also:

  • Provides that a contractor who takes over a job from a previous contractor is not liable for any defects in the work performed by the previous contractor.
  • Provide that a local government must close a permit in accordance with the building code in effect when the building department received the permit application regardless of whether the permit has expired.
  • Excludes a property owner, who is performing construction contracting on a residential property under the owner-builder exemption, from the requirement to reside on the property for at least a year if the owner is closing a permit where the contractor substantially completed the work related to the permit.
  • Provides that local governments may only charge a person one search fee for identifying the building permits for units or sub-units that are assigned to one parcel of property. Such fee shall be commensurate with the research and the time costs incurred by the local government.

The bill provides for an effective date of October 1, 2019.

Key Legislators Helping: Reps. Diamond, Robinson, Renner, Ingoglia, La Rosa, Eagle, Santiago and Payne and Sens. Perry, Gruters, Gibson, Flores, Passidomo and Simpson.

Wetland Mitigation

CS/HB 521 by Representative McClure – (CS/SB 532 by Senators Lee and Farmer)

Mitigation banking is a practice in which an environmental enhancement and preservation project is conducted by a public agency or private entity (banker) to provide mitigation for unavoidable wetland impacts within a defined region (mitigation service area). The bank is the site itself, and the currency sold by the banker to the impact permittee is a credit, which represents the wetland ecological value equivalent to the complete restoration of one acre. The number of potential credits permitted for the bank and the credit debits required for impact permits are determined by the Department of Environmental Protection or one of the state’s water management districts. A banker must apply for a mitigation bank permit before establishing and operating a mitigation bank.

In 2012, the Legislature prohibited a governmental entity from creating or providing for mitigation for a project other than its own unless the governmental entity uses land that was not previously purchased for conservation and unless the governmental entity provides the same financial assurances as required for mitigation banks permitted under s. 373.4136, F.S.

CS/HB 521 authorizes a local government to allow permittee-responsible mitigation consisting of the restoration or enhancement of lands purchased and owned by a local government for conservation purposes if state and federal mitigation credits are not available. Such mitigation must conform to the permitting requirements for mitigation banks.

Effective Date: July 1, 2019

Legislators Helping: Rep. McClure and Overdorf and Sen. Lee

A quick note about the two other issues on the leave-behind.

Sadowski (the Affordable Housing Trust Fund) received more money than last year. However, $115 Million will be sent to the panhandle for housing recovering associated with Hurricane Michael damage. For the remainder of the state, that leaves about the same amount of money as last year. In totality, the 2019 Legislature accomplished more than the 2018 legislature, but it is not full funding. Partial credit here.

Transferring the statewide Septic Tank regulations to DEP was part of a deal reached on water legislation early in the final week of session. Though it appeared all the major players had agreed, the plan was ultimately scuttled, not to be considered. Close but, the issue was not closed.

This leaves a litany of other issues such as the deregulation package, contractor fraud, permit fee transparency and others to discuss. Lets save that for another day!

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