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Homeowners Bill of Rights signed by Gov. Walker
Posted: January 15, 2018
Gov. Walker recently signed into law two pieces of legislation, Assembly Bill 479 and Senate Bill 380, that will have a significant impact on private property rights in Wisconsin. The legislation, commonly referred to as the "Homeowners Bill of Rights," was aimed at improving the regulatory environment at the state and local levels to provide property owners with greater certainty regarding the ownership and the future use of the their property. Several recent United States and Wisconsin Supreme Court decisions made it very clear that the legislature needed to enact uniform, statewide policies to better protect the rights of property owners and eliminate some of the uncertainty associated with the development process.
This legislation was a top priority for the WRA, which engaged in a comprehensive grassroots advocacy campaign through the Wisconsin Homeowners Alliance with funding assistance from the National Association of REALTORS® targeting property owners throughout the state to encourage them to contact their state legislators in support of this legislation.
The new law contains numerous provisions that will benefit property owners across Wisconsin, and the five provisions described in this article are likely the most important for REALTORS® to understand.
All substandard lots are grandfathered.
Numerous local governments, including 50 counties throughout Wisconsin, had ordinances in place that prohibited property owners from selling or building on substandard lots if those lots were adjacent to another lot and under common ownership. A substandard lot is defined in AB 479 as "a legally created lot that met any applicable lot size requirements when it was created but does not meet the current lot size requirements." By prohibiting the sale or development of these lots, local ordinances severely decreased their value of lots. Moreover, such ordinances discouraged potential buyers from purchasing property next door for investment purposes because the future sale or development of those lots could be restricted.
Under the new law, all substandard lots, both existing and future, will be grandfathered. Moreover, local governments are prohibited from enacting or enforcing any ordinance that prohibits the sale or development of substandard lots or requires such lots to be merged. Finally, the law is retroactive, so it effectively nullifies any prior actions by local governments to merge substandard lots.
The conditional use permitting process will provide more certainty to property owners
In the past, property owners who tried to obtain a conditional use permit (CUP) were often at the mercy of local government officials who were given plenary power to approve or deny a CUP based upon whatever criteria they wished. This often resulted in decisions being made arbitrarily based on personal relationships or personal preference for the proposed project. In fact, neighbor opposition was often the key factor in determining whether a project was approved or disapproved, even if the proposed project was consistent with the community's comprehensive plan and met all the CUP requirements set forth in the local ordinance.
Under the new law, all approvals and denials of CUPs must be based upon "substantial evidence." "Substantial evidence" means facts and information other than merely personal preference or speculation, directly pertaining to the requirements and conditions an applicant must meet in support of a conclusion. Moreover, all CUP conditions and standards must be reasonable, measurable and may include conditions as the permit's duration, transfer or renewal. Finally, local governments are required to grant the CUP if the property owner satisfies or agrees to satisfy all CUP conditions and requirements. These changes will make the CUP process more fair and equitable for property owners.
Homeowners can challenge their assessments even if they deny assessors entry into their homes
The new law also repeals a statute that limited the ability of property owners to challenge their assessments. Under the old law, property owners were prohibited from challenging a property tax assessment to either the board of review or circuit court if they denied the assessor entry into their home. Even if the assessor made a mistake or intentionally inflated the value of the home, the property owner was prohibited from challenging the assessment.
The new law removes this restriction and restores the ability of all property owners to challenge their assessments, even if they deny assessors entry into their personal residence. In addition, to ensure that property owners are aware of their right to deny entry to assessors, assessors are required to provide written notice to property owners informing them of their right to deny assessors entry into their homes. Moreover, the new law clarifies that denial of entry into a home cannot be the sole reason for increasing an assessment. Finally, the new law extends the amount of time, which is no later than seven days before the first meeting of the board of review, a business owner has to provide information about the business' income and expenses to the assessor. Under the old law, if a business owner didn't provide this information before the open book, the business owner was prohibited from challenging his or her assessment.
No changes to the rules after a permit application has been submitted
In the past, local communities had broad authority to change the rules required to obtain any permit, except building permits, at any point in the approval process before the permit was granted. This caused tremendous frustration for property owners who would often spend thousands of dollars on preliminary studies, tests, architectural drawings and other information necessary to meet the local government's permit requirements only to have the rules change after the permit application was submitted.
Fortunately, the law was changed in 2013 to grandfather all development permits from any changes to local ordinances after the permit application was submitted. However, some attorneys interpreted the law to provide this protection only if one approval was required by a local government, or if multiple approvals were required by more than one local government. In other words, the law did not protect property owners from changes if there were multiple approvals required by the same local government. So, if a local government required approvals from multiple committees or entities, a property owner would not necessarily be grandfathered from changes to regulations after submitting an application for a development permit. Under the new law, that potential loophole is now closed, and property owners will be grandfathered from all changes to ordinances or regulations after submitting an application for a development permit, regardless of the number of approvals required by one or more local governments.
All variances are not equal
Finally, the new law codifies recent case law that established different standards for use and area variances. An "area variance" is defined in Wisconsin law as "a modification to a dimensional, physical, or locational requirement such as a setback, frontage, height, bulk, or density restriction for a structure." A common example of such a variance is allowing a garage to encroach a few inches or feet into a side yard setback. The law defines "use variance" as an "authorization for the use of land for a purpose that is otherwise not allowed or is prohibited by the applicable zoning ordinance." An example would be allowing a commercial use in a residential neighborhood.
Under the new law, an area variance is much easier to obtain than a use variance. To obtain an area variance, a property owner must show that the ordinance would unreasonably prevent the property owner from using the property for a permitted purpose or that compliance with the zoning ordinance would be unnecessarily burdensome. To obtain a use variance, a property owner must show that without the variance, the property owner has no reasonable use of the property. While this law change simply codifies current case law, having it in the statutes will hopefully result in less confusion for local zoning officials and property owners as to the appropriate standard to apply for use and area variances.
Article from WRA.org. https://www.wra.org/WREM/Dec17/BillOfRights/