The Northern Virginia Builders Association (NVBA) and Prince William County are at odds over whether the county has the right under a new state law to require bonds for improvements offered by builders, such as off-site roads and swimming pools.
"They are cutting off the hand that feeds them," said Samuel A. Finz, NVBA executive officer. If Prince William can bond these types of improvements, developers will be reluctant to offer them at all, he warned.
Developers offer certain improvements, known as "proffers," during rezoning applications in exchange for higher-density zoning.
NVBA argues that a new law due to take effect July 1 will eliminate the bonding of amenities, whether proffered or not, unless they are essential to public health and safety.
But Prince William County attorney John H. Foote contends that the law fails to supersede legislation adopted in the 1970s that allowed proffers to be bonded.
"They're just blowing smoke at us if they are saying the General Assembly changed the rules. It just didn't," Foote said.
The builders association said last week that it was considering legislative or legal action to resolve the dispute. NVBA spokesman Tony Ahuja said the builders could seek an opinion from the General Assembly's oversight committee or from the state attorney general on the intent of House Bill 1033, could file suit or could lobby for clarifying legislation during the next session of the General Assembly.
This week, however, Finz downplayed these options, calling them too "aggressive and premature." Although Finz said he intends to warn developers to think twice before proffering improvements in Prince William County, he added that he is confident that the county staff will act reasonably and not require excessive bonding.
The changing tune apparently comes because NVBA does not want the threat of a lawsuit or new legislation to cloud its major victory in getting a bill critical to its members passed in the first place. That bill (House Bill 1033) was designed primarily to curb what NVBA considers excessive bonding in Fairfax County and was opposed fiercely by the Fairfax County Board of Supervisors. NVBA lobbied hard for its passage during the last session of the General Assembly. Builders, county officials and county legislators hoped the new law would finally put to rest years of bickering over what items a local government has the authority to bond.
Moreover, the sponsor of the bill, Del. Ralph Axselle (Henrico), confirmed in a telephone interview this week that the intent of the law is to halt bonding of proffered items.
"Even opponents cannot justify requiring that private amenities should be bonded. Only if it is necessary to protect the public should it be bonded," Axselle said.
He disputed Foote's claim that proffer legislation remains in effect, saying, "It is a concept well founded in law that the latest legislation overrides the earlier."
The new law allows jurisdictions to require bonds for public-access streets, entrances and exits to developments, storm-water management facilities and retaining walls for slope stabilization -- in other words, items critical to a safe and viable community.
Fairfax County had been requesting bonds at the site-plan stage for such amenities as tot lots, community rooms and trails that would be privately maintained. Bonds issued by a surety company act as guarantees to the county that, if the builder goes into default, the surety company can provide the county with the funds to complete the improvements.
Although Prince William County rarely has exercised its right to bond proffered improvements, county supervisors last week said they want to retain that option.
"I can't just take your word and a handshake. Those days are over," Supervisor Guy Anthony Guiffre told NVBA's attorney Ahuja at a board meeting June 18. Michael Giguere of the Prince William County Builders Association (PWCBA) urged the board to consider using the site plan approval process and occupancy permits instead of bonds if developers are reluctant to build proffered improvements.
"Bonding every little blade of grass doesn't really benefit us when you have other leverage over us," Giguere said.
But the board voted 7 to 0 to require bonding of "all improvements proffered during the rezoning application as required by the zoning administrators."
Although the decision was a disappointment for builders, the president of PWCBA, Michael Sorenson, called it a minor setback. To date, Prince William's staff has not abused its bonding authority, Sorenson said, adding that he hopes builders would not be subject to the whim of county officials.
Prince William County so far is the only jurisdiction in Northern Virginia to have enacted a bonding policy that conflicts with NVBA's interpretation of the new law. Finz said he will wait to see how Prince William County implements its new policy before deciding what action to take next.