Enforcement of Tax Liens

This year, one subject that raised a lot of questions related to title to real estate acquired by the foreclosure process for failure to pay real estate taxes and the sales of those properties. Although the process is laid out very clearly in the statute, Title 36, particularly §§ 942 and 943, it has proven challenging for tax assessors to always get things right. The Law Court has been very clear that if there is even a minor error in the tax foreclosure process, it will be declared to be void if challenged by the taxpayer.

One of the particular areas of concern is the requirement under Title 36, Section 943 (the so-called 30-day notice), which must be served to complete the foreclosure process. A common mistake that is made is that the notice is simply sent to the address of the property itself, rather than to the owner’s usual place of abode, or last known address. Another problem we have seen is that when a town isn’t careful, it assesses property to one property owner when there are multiple property owners, including husbands and wives. A notice of foreclosure only sent to one property owner may not be effective against the property as a whole, and, at a minimum, will not be effective against the interests of the property owner who was not notified. Even when it is clear that the process was handled properly, towns often choose to file a quiet title action to ensure that they have good title to property before attempting to re-sell it. The title standards of the bar generally require a ten-year waiting period for titles to be considered clear. There is no impediment to the town selling the property once it obtains title through the foreclosure process, even if title has not been declared by a court. It is critical that the assessor carefully follows the exact process laid out in Title 36, §§ 942 and 943, for the municipality to properly acquire title to property acquired because of tax delinquency.

Adult Use Marijuana Rules Passed

The Maine Office of Marijuana Policy has adopted final rules regarding the cultivation, manufacture, sale and use of adult use marijuana in Maine. These rules will take effect on December 6, 2019. Municipalities that have been holding off on passing marijuana-related ordinances while awaiting the adult use rules may find this a good time to restart the process. However, the law remains that adult use marijuana facilities may not locate in a community that has not “opted in” to adult use marijuana by passing a town meeting article or ordinance to allow them in some or all areas of towns. For facilities looking to locate in towns that have already opted in, applications for state licenses will be available starting December 5, 2019.

Here is a link to the adopted rules.

NH Supreme Court Weighs in on Short-Term Rentals

In an opinion issued on September 27, 2019, the New Hampshire Supreme Court addressed the regulation of short-term residential rentals. The Court’s decision provides guidance for municipalities in regard to the allowance of short-term residential rentals, such as through websites like Airbnb, Home Away, and VRBO. 

In Working Stiff Partners, LLC v. City of Portsmouth, single-family, two-family, and multi-family dwellings were allowed in the applicable zoning district. The Portsmouth Zoning Ordinance (PZO) defined a “dwelling unit” as follows: 

… A building or portion thereof providing complete independent living facilities for one or more persons, including permanent provisions for living, sleeping, eating, cooking and sanitation. This use shall not be deemed to include such transient occupancies as hotels, motels, rooming, or boarding houses. (Emphasis added.) 

The Court found that short-term rentals of as little as one day at a time constituted “transient” occupancy and were thus explicitly excluded by the PZO definition from being a “dwelling unit.”

However, many zoning ordinances in New Hampshire have a definition of “dwelling unit” similar to Portsmouth’s definition except that they do not expressly exclude transient occupancy. The Court’s decision thus leaves open the question of whether short-term rentals may be prohibited where the local ordinance definition does not expressly exclude transient occupancies. 

There were other facts in the Portsmouth situation which may have influenced the Court’s decision. The property in question was advertised on Airbnb as allowing occupancies of as little as one day; and was also advertised as being suitable for “family parties, wedding parties, and corporate stays.” The Court may have reached a different result if the property in question could only be rented for longer periods of time (e.g., a minimum of one week), or if the property’s use did not include wedding parties, corporate stays, and other events, but was limited to single-family residential usage.

Thus, while the Court’s decision appears to allow municipalities to regulate short-term residential rentals, municipalities may not want to prohibit them, or may only want to prohibit them in specific zoning districts, or may only want to regulate them, for example: 

• By allowing short-term residential rentals but prohibiting wedding parties, corporate stays, or other commercial uses; or 
• By requiring residential rentals to be a minimum duration (say, one week); or 
• By requiring short-term rental owners to register as such and be subject to inspections for health and safety purposes. 

Whatever municipalities decide, they should consult counsel to make sure that their zoning definitions and provisions accomplish the result they want to achieve.

Definition of Subdivision

Condominium and other multi-unit projects located within a single structure often pose challenges to municipal planning staff and developers alike, particularly as to whether a certain project should be reviewed under the municipal subdivision ordinance, municipal site plan ordinance, or both. Prior Legislative committee amendments to 30-A M.R.S.A. § 4401 and § 4402 were intended to broaden exemptions to municipal subdivision review by exempting projects reviewed under municipal site plan ordinances. After adoption, however, the Revisors Office included language in the printed bill that review must be in accordance with Title 38, section 488, subsection 19 or Title 38, section § 489-A; i.e., DEP Site Location of Development Act. 30-A M.R.S.A. § 4402, sub-§ 6. Instead of broadening the exemption for certain projects, as the Legislature had intended, the final printed language of the bill limited the exemption to only those projects reviewed under Site Law.

These two statutes where again amended on May 30, 2019, by Legislative Document 550, which will take effect on September 19, 2019, and will be applied retroactively to June 30, 2018. The 2019 amendments delete the reference to DEP Site Law and instead define municipal site plan review as “review under a municipal ordinance that sets forth a process for determining whether a development meets certain specified criteria, which must include criteria regarding stormwater management, sewage disposal, water supply, and vehicular access, and which may include criteria regarding other environmental effects, layout, scale, appearance, and safety” (30-A M.R.S.A. § 4402, sub-§ 6).

The new law also states that the municipality’s reviewing authority shall determine whether a municipal site plan review ordinance meets the requirements previously delineated. It also changes the dates for when definitions of “subdivision” in municipal ordinances must comply with the definition of “subdivision” in state law. The prior statute required municipal ordinances to comply with the state law’s definition of “subdivision” by January 1, 2019. 30-A M.R.S.A. § 4401, sub-§ 4, ¶ H–2. Legislative Document 550 changed this date to January 1, 2021 (S.P. 172, L.D. 550, 129th Leg., 1st Reg. Sess. [Me. 2019]). The prior statute also required municipalities to file their conflicting definitions at the country registry of deeds by June 30, 2018, in order for the definition to remain valid through the grace period ending on January 1, 2019 (30-A M.R.S.A. § 4401, sub-§ 4, ¶ H–2). A municipality now “must file its conflicting definition at the county registry of deeds by June 30, 2020, for the definition to remain valid for the grace period ending January 1, 2021” (S.P. 172, L.D. 550, 129th Leg., 1st Reg. Sess. [Me. 2019]).

Municipalities Await Guidance as to How to Apply New Tax Exemptions for Wind and Solar

The 129th Legislature passed several laws to promote renewable energy in Maine. One of these was LD 1430, enacted as PL 440, which exempts wind and solar energy property from assessment. The exemption applies to both real and personal property, whether used residentially or commercially. It does not apply to “grid-scale” projects that sell energy to the grid for profit. It will apply starting with the April 1, 2020, assessment date.

While the exemption may seem simple on the surface, the law contains some ambiguities that are making it a bit difficult for assessors to plan ahead. The biggest question pertains to renewable energy facilities that are fixtures to real property. For instance, a piece of real estate may be benefitted by solar panels, but the municipality may have not specifically accounted for the value of those panels in making the overall valuation for the property. PL 440 will allow taxpayers to file a “report” with the assessor(s) by April 1 of the relevant tax year “identifying” the property for which exemption is claimed. The law is unclear as to whether it would require the assessor to reduce the assessment by the claimed value of the solar panels even if those panels were not considered in making the assessment.

The new law directs the Department of Revenue Services to provide guidance by December 1, 2019, regarding the methods by which renewable energy facilities should be valued. Although the law does not specifically mandate municipalities to assess renewable energy facilities, the intent appears to be that municipalities will value the facilities (with guidance from Revenue Services), and then that value will then be subject to exemption. For the purposes of the 2019-2020 tax year, municipalities are still free to assess solar and wind facilities according to their standalone value or to their impact on the overall property value. The Cumberland County Superior Court recently upheld the Town of Brunswick’s practice of applying per-panel assessment for solar facilities, finding that the panels did have inherent value and that the taxpayers had not proven otherwise.

A New Twist in the Road for Road Disclosures

While intended to make real estate transfers more opaque, 33 MRSA section 193 likely will result in more demands upon municipal public work’s directors, CEOs, assessors, and planners.

On August 1, 2018, 33 MRSA § 193 went into effect, requiring sellers of nonresidential property to disclose “information identifying any abandoned or discontinued town ways, any public easements and any private roads located on or abutting the property, if known by the seller” along with “information identifying the party or parties responsible for maintenance of any abandoned or discontinued town way, public easement or private road on or abutting the property identified pursuant to subsection 1, including any responsible road association, if known by the seller” (Me. Stat. tit. 33, §193). It was subsequently repealed by Legislative Document 1151 on March 7, 2019. 

On September 19, 2019, a new statute, 33 MRSA §193, sub–§3, will take effect, requiring sellers of nonresidential property to disclose information “describing the means of accessing the property by a public way” and “any means other than a public way, in which case the seller shall disclose information about who is responsible for maintenance of the means of access, including any responsible road association, if known by the seller” (H.P. 622, 129th Leg., 1st Reg. Sess. [Me. 2019]).

While the prior act required disclosures of known information about abandoned or discontinued town ways, public easements, private roads, and their maintenance, the new rule requires sellers to disclose information about all means of accessing the property, but only requires disclosure of who is responsible for maintenance for means other than a public way. Thus, the disclosure requirements are no longer limited to abandoned or discontinued ways, public easements, and private roads. Rather, sellers must disclose “any means” of accessing the property.

Since the answers to these questions are often unclear, it is likely that municipalities will field more phone calls and inquiries about the status of roads.

Notice Under Maine Tort Claims Act Increases to One Year

A new law passed by the Maine Legislature goes into effect on January 1, 2020. Under the Maine Tort Claims Act, Title 14. § 8101, et seq., within 365 days after any tort claims or cause of action arising under the Maine Tort Claims Act, a claimant must send a written notice to the municipality. Formerly, notice had to be filed within 180 days. The notice must contain the name and address of the claimant and claimant’s attorney, if any; a precise statement of the basis for the claim and the circumstances; identifying information about the governmental employee involved; and a statement regarding the extent and nature of injury and monetary damages. There is an exception if the claimant is able to show good cause why the notice could not reasonably have been filed within the 365-day limit. 

The Maine Tort Claims Act provides immunity to municipalities except in specific situations outlined in the statute. The areas for which a municipality is responsible include ownership, maintenance or use of vehicles; construction, operation or maintenance of buildings or the appurtenances to any public buildings; the discharge of pollutants; and, during the active performance of construction, street cleaning or repair operations on a road. There are specific exceptions under the Act, depending on the circumstances.

While formerly a municipality was in the clear if a notice was not received within 180 days, now it must wait a full year.

Maine Bicentennial Grants Available to Municipalities

In preparation for Maine’s celebration of the 2020 Bicentennial (I am sure everyone remembers that we became a State in 1820 because of the Missouri Compromise), the State is offering grants to state and local governments, including municipalities, nonprofit organizations, schools and other organizations in partnership with the above. The Maine Bicentennial Commission will be distributing $500,000 as part of this program, with up to 10% of funds set aside for small grants of $500 or less, up to one large grant per county of $10,000, with the remaining funds used to fund grant applications in amounts that range between $500 and $10,000 until all funds are dispersed.

The grants will fund public programs such as lectures, storytelling workshops, discussion groups, and other programs to provide context to the Bicentennial Commemoration and will sponsor events such as parades, fairs and festivals, exhibitions, history projects, curriculum development for schools, student projects and activities, preservation projects and arts performances. Priority will be given to projects that are directly tied to the commemoration of Maine’s Bicentennial, are supported through local matching funds or in-kind contributions, are designed to reach and engage as many members of the diverse communities as are possible, create lasting resources, and involve multiple community partners such as schools. The following four themes are strongly encouraged: 

• Living in Maine 
• The Business of Maine 
• Maine Leads 
• The Maine Character 

Grant applications must be submitted to the Maine Bicentennial Commission, in care of the Maine Arts Commission, to be reviewed by a panel of representatives from the Maine Cultural Affairs Council and from practicing educators. There are three cycles, with application deadlines of September 21, 2019; February 1, 2020; and June 1, 2020. The screening committee will make awards based on the priorities and a distribution geographically across the state. Commemoration activities must involve a public component for participation in the grants and recipients must upload a photo of activities to the Bicentennial Facebook page and complete a brief summarizing of how funds were expended. The money must be expended by March 30, 2021. 

To What Extent Does a Zoning Board of Adjustment or Planning Board Have to Make Specific Findings of Fact to Support Its Decision?

In a recent case, Dietz et al. v. Town of Tuftonboro (decided January 28, 2019), the New Hampshire Supreme Court held that a Zoning Board of Adjustment (ZBA) did not have to make written findings to support the granting of an equitable waiver pursuant to RSA 674:33-a. In that case, the owner of a house on Lake Winnipesaukee sought an equitable waiver because two additions that it had built (and which had been allowed by the Town of Tuftonboro building inspector) violated the 50-foot Lake setback requirement of the Town’s Zoning Ordinance. (The Supreme Court’s decision addressed other issues of law, but this blog will focus on the question of whether a ZBA needs to make written findings of fact supporting its decisions.) 

RSA 674:33-a, I, provides that: “The [ZBA] shall, upon application by and with the burden of proof on the property owner, grant an equitable waiver from the [zoning ordinance] requirement, if and only if the board makes all of the following findings.” The statute then lists four findings that the ZBA must make in order to grant the equitable waiver. Reasoning that the statute did not explicitly state that written findings were required, and that if the Legislature intended to require written findings, it could have done so, the Court held that the ZBA had not erred by failing to make specific written findings on the statutory criteria. 

The Court’s decision with respect to equitable waivers is consistent with its decisions in regard to written factual findings to support the granting of a variance. Presumably, although this author is not aware of any cases so holding, a ZBA also does not need to make specific findings when granting a special exception. 

However, these general principles should not lull ZBA members into thinking that they need only make broad conclusory findings with respect to the variance, special exception, or equitable waiver criteria. Though a ZBA may not generally be required to make specific written findings, ZBA members should keep in mind the following:

1. The Court in Dietz et al v. Town of Tuftonboro stated that “although disclosure of specific findings of fact by a board of adjustment may often facilitate judicial review, the absence of findings, at least where there is no request therefor, is not in and of itself error” (emphasis added). Thus, the Court has suggested that a ZBA should make specific findings of fact if requested to do so by the applicant or another interested party. If such request is made, the ZBA should make the specific findings that are requested, as long as they reasonably relate to the variance, special exception, or equitable waiver criteria that are at issue.
2. Even when the ZBA does not make specific findings of fact with respect to the variance, special exception, or equitable waiver criteria, ZBA members should at least discuss those criteria and give them due consideration.
3. ZBA members should be aware of whether the ZBA’s own Rules of Procedure require specific findings to be made. Although the Supreme Court has held that the applicable statutes do not require specific findings to be made, a particular municipality’s Rules of Procedure could require them. If so, the Rules would govern and specific findings should be made.

Law Court Finds FOAA Complaint Properly Dismissed

Maine’s Law Court recently issued a brief decision reminding Freedom of Access Act (FOAA) practitioners that FOAA complaints are subject to dismissal, like any other complaint, where they fail to allege facts that would entitle a plaintiff to relief under the statute. 

The facts in the case, Dubois v. Town of Arundel, involved a denial by the Town of Arundel’s Planning Board of an application to renew a conditional use permit submitted by an agricultural composting facility. The Planning Board denied the application during a public hearing, which was not attended by any representative from the composting facility, including the two plaintiffs in the case. Following the Planning Board’s denial, the plaintiffs filed a complaint alleging that a memorandum drafted by the Town Planner and distributed to the Planning Board members led to an illegal executive session. The Town of Arundel moved to dismiss the complaint for failure to state a claim that would entitle the plaintiffs to relief, which the trial court granted and the plaintiffs then appealed.

On appeal, the plaintiffs argued that a complaint brought under the FOAA is not subject to dismissal for failure to state a claim. However, the Law Court rejected this argument and found no merit for the proposition that a motion to dismiss is barred in the context of a FOAA complaint. 

Turning to the substance, the Law Court examined the complaint to determine whether it alleged facts that would entitle the plaintiffs to relief. Here, the Law Court explained that the complaint failed to allege that any action was actually taken during an executive session that would violate the FOAA. On the contrary, the complaint merely alleged that a memo from the Town Planner led to an executive session, and that the Planning Board then held a public hearing at which the composting facility’s application was denied. Consequently, because the complaint failed to allege that any specific action was taken during an executive session, the Law Court found that the trial court properly dismissed the complaint for failure to state a claim under the FOAA that would entitle the plaintiffs to relief.

Animal-Related Ordinances – Out of Sight and Out of Mind?

When was the last time you checked your animal-related ordinances to confirm that they were keeping up with, and meeting the needs of, your ever-changing community? These ordinances are easy to overlook until you need them and then, unfortunately, the tools you need may not be there. Maine law provides broad authority to enact and enforce animal-related ordinances. 

We see in our state, municipalities that include within their borders urban, residential, industrial, rural, and agricultural areas. We also see municipalities entering into contract zones or approving conditional zoning ordinances as appropriate when faced with development projects. Our rapidly changing communities need animal-related ordinances that will keep up with the new realities. For example, the person who has for many years kept horses on his or her property that may have escaped from their fenced in area from time to time, finds that his or her property is now near a road with increased traffic—an escaped horse puts both the drivers of automobiles and the horses at risk. Or, how about the person that keeps their dogs tied outside all the time. While every municipality should consider having an ordinance that puts some parameters around this, especially in the heat of the summer and the frigid winters, what do you do about the barking? Maybe you rely on your noise ordinance, but will it be enough? 

New realities include how animals are viewed, especially pets. The pet business is growing and raking in billions of dollars, which evidences the evolving view of animals kept in the household. You may recall the outrage generated when the Town of Scarborough was discussing enacting ordinances that would ban dogs from certain of its beaches during certain times. Even though this was in response to an incident related to a bird and the IF&W threatened to fine the Town, members of the community demanded that the Town act proportionately. The Town created an Animal Control Advisory Committee who generated a report attempting to balance the environmental issues with the rights and needs of dog owners. 

Also for consideration: Do you allow residents to keep a small number of chickens, even in urban areas, to provide eggs to the family? Does your ordinance contain reasonable requirements for dog day care and boarding facilities, a service used by so many people? 

Finally and importantly, are your animal-related ordinances humane and actually help you get the results you wish to achieve? Do they impose the punishment on the right party—the person violating the ordinance as opposed to the animals he or she is supposed to care for? Do you have the tools you need?

Marijuana Caregivers – A Regulatory Challenge in Residential Areas

Last session, the Maine Legislature passed LD 1539, which provided that registered medical marijuana caregivers could serve an unlimited number of patients. The law also requires municipalities to “opt in” if they wish to allow medical marijuana caregivers to open retail storefronts. We are all thankful for the clear language as to medical marijuana retail stores, but one aspect of the law that is proving challenging to municipalities is what—if anything—to do about regulating caregivers who do not wish to operate retail stores. 

We do know that municipalities have the authority under 22 M.R.S. § 2429-D to regulate registered caregivers, whether they operate a retail store or not. The only express limitation on that authority is that municipalities may not prohibit registered caregivers or limit their number. This means that municipalities are free to zone caregivers, require them to obtain licenses, or require them to comply with ordinance standards related to odor prevention, security, or other concerns. 

If your town is considering applying regulations to non-retail caregivers, here are some points to consider: 

1. Because the identity of registered caregivers is kept confidential, municipalities cannot simply obtain a roster to determine whether caregivers are a common use in town, or where they are located.
2. Many caregivers may fall within existing provisions related to home occupations. Consider whether specific restrictions would help ensure against negative impacts on the neighborhood, such as odors or traffic.
3. If you are considering requiring licenses, know that this will create a sort of registry of caregivers, since the municipality’s licensing records will likely not be subject to the same confidentiality that applies in the hands of the State. Some have noted that having such a list might subject those on it to safety or security concerns.
4. Make sure that any regulations on non-retail caregivers are in keeping with the scale of the operation. Consider whether proposed licensing fees or technical requirements are so onerous that they have the consequence of prohibiting small-scale caregivers.
5. Confirm that any proposed zoning regulations are (1) in conformity with the comprehensive plan; and (2) tailored to address concerns that are particular to the use.
6. Consider how pre-existing caregivers will be treated under the ordinance. Caregivers that were operating with any sort of municipal approval should clearly be treated as grandfathered against any new ordinance, but that right may be less clear for caregivers that were operating under the radar prior to an ordinance change.

As with the development of all ordinances, it is important to take your time and invite all stakeholders to the table. We have participated in and are monitoring municipal efforts throughout the state and can speak to the wide range of options that are being implemented. There is an approach that will work for your town, although it may take some work to get there.

Town Prevails on Whistleblower Protection Act Case

The Law Court entered a decision on April 11, 2019, which took the rare step of granting summary judgment in favor of the Town of Denmark in a case that an employee brought against the Town. The underlying facts were that the employee worked from 2003 to 2014 under a written employment contract with the Town to serve as a part-time Code Enforcement Officer (CEO). The contract stated that he was to “perform all duties as specified by the law and ordinance and to perform such other proper duties . . . as assigned by the Board of Selectmen.” In September 2014, the Town’s new Town Manager advised the CEO to report directly to him rather than the Board of Selectmen. The employee complained to the Manager and the Board that the directive was an illegal violation of his employment contract with the Town because he interpreted the contract to require that he report to the Board, not the Town Manager. Shortly thereafter, the Board of Selectmen approved a new job description for the CEO position and offered it to the employee. He objected to the new job description, asserting that it breached his contract and stated “that because it changed the CEO job description, the Town would need to form a Charter Commission and then call a public meeting to call a special election.” The following month, the employee was placed on paid administrative leave because of an allegation that he had been falsifying pay records. After investigation, it was determined that he had not falsified pay records and the Board voted unanimously to rescind his suspension. The Town Manager resigned his position. 

Under these facts, the Superior Court granted summary judgment and the Law Court affirmed. It closely analyzed the requirements of the Whistleblower Protection Act, 26 MRS §§ 831, et seq., to determine whether the employee reported to his employer what he had reasonable cause to believe was the employer’s unlawful activity. The Court found that the reasonable cause requirement required that the employee present evidence showing he had both a subjective belief that the employer engaged in illegal activity and, also, that the belief was objectively reasonable such that a reasonable person might believe illegal activity occurred. The employee argued three sections of statute—30-A MRS §§ 2601, 2601-A and 4451—plus the CEO job description demonstrated that the change was illegal. The Court rejected this argument and stated that an employee must report something other than a standard breach of an employment contract to put himself within the provisions of the Whistleblower Protection Act. Further, the Court held that even if the employee subjectively believed that the Town’s actions violated Maine law or the Town’s charter, that his subjective belief alone was insufficient to meet the reasonable cause requirement because neither the law nor the charter by any reasonable reading made the Town’s actions unlawful. 

Because these cases are generally very difficult to win on summary judgment, this narrower interpretation of the Whistleblower Protection Act is good news for municipalities and employers in general. 

(2019 ME 54 Michael A. Lee v. Town of Denmark)

Are Notices of “No Violation” Appealable in Maine?

If a code enforcement officer (CEO) issues a written decision finding “no violation” of a land use ordinance, is that decision appealable? Recently, Maine’s Law Court tackled this very question and answered “yes”—but only so long as the ordinance does not say otherwise.

In Raposa v. Town of York, an abutter became concerned about how a neighbor was using property. The abutter contacted the CEO, who responded to the abutter with an email explaining that no violations were warranted based on the neighbor’s use of the property. The CEO’s email included a notice advising the abutter that the Board of Appeals could hear an appeal from “any order, requirement, decision, or determination” made by the CEO or any other person charged with administering the ordinance. Heeding that advice, the abutter appealed the CEO’s “no violation” determination to the Board of Appeals and then to the Superior Court, where the Town of York moved to dismiss the appeal for lack of jurisdiction. The Superior Court granted the Town’s motion, finding that the Board’s review of the CEO’s decision was advisory and therefore unreviewable.

Reversing the Superior Court, the Law Court explained that Notices of Violation (NOVs) have been generally appealable since 2013—when the Legislature amended the statute governing appeals from municipal boards—except where an ordinance expressly provides that certain decisions are only advisory and may not be appealed. Although the Law Court noted that the plain language of the amended statute does not explicitly address “no violation” notices, the Court also noted that its previous decisions have “expressed the understanding that such ‘no violation’ actions are similarly appealable” because of their potential impact on property uses. In Raposa, the Law Court took the opportunity to make its previous expressions more concrete, holding conclusively that “a CEO’s written decision interpreting a land use ordinance is appealable to the Board and in turn to the Superior Court—whether the CEO finds that there is or is not a violation—so long as the ordinance does not expressly preclude appeal.” Because the Town of York’s ordinance did not have a provision that expressly precluded appeal, the Law Court found that the abutter’s appeal was not subject to dismissal by the Superior Court. 

In light of Raposa, municipalities should review the appeal provisions in their land use ordinances and update them accordingly.

Municipal Officers Can Pass Certain Ordinances

Even in towns where all legislative authority rests with town meeting, the Selectmen or Town Council have authority to pass certain kinds of ordinances. Following is a list of those topics: 

Traffic Control Ordinances – Title 30-A M.R.S. § 3009 allows the municipal officers to enact ordinances governing: 

• Pedestrian traffic, including the use and maintenance of sidewalks and crosswalks. (Yes, the municipal officers can pass an ordinance requiring property owners to clear snow from sidewalks.)
• The operation of vehicles in the public ways and on publicly owned property. (Towns have used this to pass Jake brake ordinances, motorcycle noise ordinances, and various other issues that aren’t covered by state law).
• Parking in public ways or public parking areas.

Extension of Moratoria – While town meeting must enact the original moratorium, the municipal officers may act to extend the moratorium for additional 180-day periods upon a finding that the conditions which called for the moratorium still exist. (30-A M.R.S. § 4356)

Cable TV Ordinances – The municipal officers may enact ordinances governing the franchising and regulation of cable TV within the municipal boundaries. (30-A M.R.S. § 3008)

General Assistance Ordinances – These ordinances govern the processing and application requirements for receiving general assistance from the municipality. Each year, the municipal officers must also amend the local maximum levels of assistance. (22 M.R.S. § 2305) (Note that Maine Municipal Association provides a model ordinance as well as annual suggested maximums.)

Local Snowmobile and ATV Access Routes – Under state law, snowmobiles and ATVs may not travel within the public way. However, 12 M.R.S. 13106-A(5)(G) gives the municipal officers authority to pass ordinances allowing for such travel if they determine that it can be done safely.

How to Handle Tax Foreclosures When the Property Has an IRS Lien

After a municipality goes through the statutory foreclosure process because of delinquent taxes on a piece of real estate, it normally takes the property free and clear of any pre-existing liens, mortgages, executions of judgment, or other clouds on the title to real estate. The exception to this is when the property has an IRS lien against it for unpaid income taxes by the property owner. There is, however, a method for dissolving those liens if the proper procedure is followed. When the lien is dissolved, the municipality will own the property free and clear of the IRS lien at the time that it takes title. 

At the time of foreclosure, the tax collector should send a copy of the lien certificate to the IRS at the same time it is recorded with the registry of deeds. The municipality should also send a copy of the notice of impending foreclosure to the IRS itself. The way to extinguish an IRS lien against the property is by the municipality sending the IRS a copy of a notice pursuant to 26 U.S.C.A. § 7425. Samples of the notice can be found on the IRS website (IRS publications 786 and 4235). The statutory notice will extinguish the IRS lien as long as it is sent to the IRS by certified mail at least 25 days prior to the date of automatic foreclosure. It is best to send the section 7425 notice to the IRS at the same time that the 30–45 day notice of pending foreclosure is sent. The IRS has a redemption period of 120 days following the date that the municipality takes title through the foreclosure process. Thus, it would be wise to wait the 120 days after taking possession before selling the property. 

While it is not clear that the IRS would foreclose on a lien against property that is no longer owned by a taxpayer, but rather is owned by the municipality, obviously clean title to the property is preferred, and the sending of this notice is the way to achieve that.

Amendments to Rule 15c2-12 Coming into Effect in February

On February 27, 2019, two new required municipal securities disclosure events will come into effect pursuant to amendments to U.S. Securities and Exchange Commission Rule 15c2-12. The amendments apply to municipal securities issued on or after February 27, 2019.

Currently, there are 14 different events for which notices must be filed pursuant to Rule 15c2-12, which include events such as rating changes or events affecting the tax-exempt status of the security. The purpose of these notices is to provide certain information to investors. These event notices are part of the continuing disclosure obligations Rule 15c2-12 stipulates underwriters of municipal securities must ensure the issuer or obligated person will fulfill. In addition to the event notices, the rule includes other requirements, such as the filing of annual financial information. This continuing disclosure information is provided to the Municipal Securities Rulemaking Board (MSRB) on an ongoing basis and made accessible to investors through its Electronic Municipal Market Access website. 

As of February 27, notices will be required for two new events:

1. The incurrence of a financial obligation of the obligated person, if material, or agreement to covenants, events of default, remedies, priority rights, or other similar terms of a financial obligation of the obligated person, any of which affect security holders, if material; and
2. A default, event of acceleration, termination event, modification of terms, or other similar events under the terms of a financial obligation of the obligated person, any of which reflect financial difficulties.

As with the current list of events, notice of these two new events must be provided to the MSRB within 10 days of the event’s occurrence.

Standing to Appeal Requires “Continuous Participation”

Local appeals boards are usually in the habit of considering the particularized injury prong of the standing test, but often brush over the participation prong. The Lincoln County Superior Court recently issued a decision in Our Town, et. al. v. Town of Damariscotta, et. al. (Lin. Cty. Super. Ct. Dkt. WISSC-AP-2018-3), which serves as a good reminder to local boards of appeals that they have jurisdiction to review and determine whether the appellants before them have sufficiently participated in the hearing process. 

Most municipal ordinances allow for an “aggrieved party” to appeal local administrative decisions. To be “aggrieved,” a party must show that he or she participated throughout the administrative process, and that the decision causes him or her to suffer a particularized injury or harm. Participation generally requires the party to have attended the relevant meetings (whether in person or through written comments) and raised any issues he or she may have. When the appellant is an individual, participation is usually easy to demonstrate through examination of the meeting record. However, as discussed in the Our Town case, it can be more complicated when a group or coalition is appearing as an appellant. 

In Our Town, a group of affected individuals presented an appeal of a site plan approval issued by the Damariscotta Planning Board. When the Board of Appeals considered whether the group had standing, it noted that one of the members had appeared at a pre-application workshop, that none of the members had appeared at the Planning Board meetings on the application, and that one of the members had submitted written comments after the close of the hearing. Accordingly, it found that Our Town did not have standing because its members had not continuously participated in the review process. The Court agreed, holding that because it was the group that was asserting standing, the individual members had to have identified themselves as members of the group when they appeared. The Court also held that participation before and after, but not during the hearing, was not sufficient to demonstrate continuous participation. 

Appeals boards should, as a preliminary matter, evaluate both prongs of the standing test before proceeding to the merits of an appeal. If, on review of the record, it is clear that the appellant did not sufficiently participate in the review process, the Board is free to deny the appeal, and a court is likely to give that decision a good degree of deference.

Why Municipalities Should Convey Real Property by Quitclaim Deed

Municipalities own real estate that they convey to third parties in a variety of situations. Most often this occurs in the context of conveying property the town acquired because of unpaid property taxes back to the taxpayer once the past due amounts have been paid in full, but also in the context of municipal-owned property in industrial parks and other property suitable for development. Almost always a municipal quitclaim deed is the appropriate instrument for conveying tax acquired property. A municipal quitclaim deed releases any right, title, or interest the municipality may have in the described property to the identified grantee, without any covenants or guarantees of title. Put another way, such deeds do not contain any representation or warranty by the municipality as to whether or not it actually has title to the described property or whether or not the property is subject to any lien or encumbrance. Muni-quitclaim deeds are truly the “buyer beware” of deed forms.

Nonetheless buyers of property and other parties acquiring title to real property from a municipality often ask for a warranty deed or a quitclaim with covenant deed. The rationale these buyers offer is that they, unlike taxpayers paying back taxes, are paying real money for the property and they are entitled to know that the municipality has title and that it is free and clear of liens and encumbrances. These buyers are in effect asking the municipality to perform the buyer’s due diligence and search title to the property. For a number of reasons, this burden switching is inappropriate and improperly places the burden of insuring title on the municipalities’ residents.

While municipal quitclaim deeds offer nothing in the way of promises to the buyer, other forms of deeds—for illustration purposes, warranty deeds and quitclaim deeds with covenant—provide a number of such promises. A warranty deed is the seller’s promise that it has the interest in the property it is purporting to convey to the buyer; that there are no encumbrances on the property, such as mortgages, liens, or easements, other than those referenced in the deed; and that the buyer’s possession of the property will not be interrupted by someone with a superior interest in the property. Most importantly, the seller promises that its title to the property is free of defects, and that it will defend the buyer’s possession of the property against the claims of “all persons,” even with respect to defects or claims that may have arisen years before the seller acquired the property. By giving a warranty deed, then, a seller takes on potential liability not just for what the seller has done during his or her period of ownership, but also for claims arising well before he or she acquired the property, of which it likely has no knowledge. Quitclaim deeds with covenant offer similar promises, with the exception that the guarantee of no defects or claims covers only that period of the seller’s ownership.

A municipality often acquires property without having performed a complete title examination and is thus unable to know whether it has title to the property, whether such title is subject to any liens or encumbrances, and whether others have claims to the property. Only by a thorough title examination is the municipality able to answer these questions and to meaningfully evaluate what such promises might entail for potential future liability. Even though a tax foreclosure provides that a municipality owns a property free and clear of any encumbrances, the title standards require either a five- or fifteen-year waiting period for clean title, depending on when the period of redemption expired.

Even though the possibility of selling a property for more money exists when a deed other than a quitclaim is given, absent an action to quiet title, the risks outweigh the benefits.

Neighborhood Cats

“The phrase ‘domestic cats’ is an oxymoron.” —George Will

Municipalities must deal with a wide variety of issues involving animals, from dangerous dogs to animals on highways, alive and dead. Funds for the Animal Control Officer (ACO) are limited due to budget constraints and the ACO may not be experienced in dealing with certain issues, such as the problems involving feral or so-called neighborhood cats. 

First, though, some brief background information on neighborhood cats generally.

Although a rough number, the Humane Society of the United States (HSUS) estimates that about 85% of owned cats are spayed or neutered, while only 2% of unowned or semi-owned cats (what we refer to as “neighborhood cats”) are spayed or neutered. These estimates also attribute about 80% of all kittens born each year to neighborhood cats.

There is, however, a way to spay or neuter these neighborhood cats (and vaccinate them), reducing the number of neighborhood cats born each year and, in turn, reducing their overall number over time. In “Return to Field” (RTF) programs, healthy, unowned cats are sterilized, ear tipped, vaccinated, and put back where they are found. Part of the rationale behind this approach is that these cats know how to survive on their own, so there is no need to euthanize them to avoid future suffering. This approach also helps reduce the financial and emotional burdens on shelters in having to euthanize healthy cats.

Similar programs, such as “Trap, Neuter, and Release” (TNR), which also includes spaying, are widely used throughout the country and offer another humane way to manage neighborhood cats. Should you decide to pursue a TNR program, you may find that there are resources in your community that are ready, willing, and able to help—animal rescue groups, wildlife agencies, and maybe just individual volunteers. The trapping part needs to be managed diligently—checking traps no less than once a day, and more often in cold or hot weather, is important to ensuring a humane process.

The HSUS guide Managing Community Cats, A Guide for Municipal Leaders contains a lot of useful information about which neighborhood cat population control methods have worked, those that have not worked, and where you might find funding in the form of grants or otherwise to help support your RTF/TNR efforts.

The Neighborhood Cats TNR Handbook contains detailed information about how to set up a TNR program, with potential funding sources found on page 151. 

As Mark Twain once said: “If man could be crossed with the cat it would improve the man, but it would deteriorate the cat.”

Recent New Hampshire Supreme Court Case Places Limits on Planning Boards’ Site Review Authority

In Trustees of Dartmouth College v. Town of Hanover, _____ N.H. _____ (2018), decided November 6, 2018, the New Hampshire Supreme Court reversed the decision of the trial court, which had upheld the Hanover Planning Board’s decision denying Dartmouth College’s proposed construction of a new Indoor Practice Facility (“IPF”). Dartmouth sought approval for a 69,860 square foot IPF within the College’s existing athletic complex located in Hanover’s Institutional Zoning District (in which athletic facilities were an allowed use). The Planning Board, in a 4-1 decision, denied the site plan application on the grounds that it: (1) did not conform with the Hanover Master Plan; (2) negatively impacted abutters, the neighborhood, and others; and (3) did not promote the harmonious and aesthetically pleasing development of the town. The trial court upheld the Planning Board’s decision, finding that it was not unreasonable or unlawful.

The Supreme Court, however, overturned the Superior Court’s decision, finding that a reasonable person could not have reached the same decision based on the evidence before the Planning Board. The Supreme Court held that the Planning Board members had improperly denied the College’s site plan application based upon ad hoc reasoning characterized by conclusory statements and personal feelings unsupported by the evidence.

The case provides a number of issues for planning board members to consider when they are reviewing a site plan application, including the following:

1. Though a planning board is entitled to rely in part on its members’ own judgment and experience when acting upon a site plan application, the decision cannot be based solely upon personal opinions or “vague concerns” of its members.
2. Although on appeal a planning board’s factual findings are considered prima facie lawful and unreasonable, personal opinions and vague concerns are not factfinding entitled to deference.
3. A planning board cannot deny a proposed use simply because its members do not feel that the use is appropriate, where the use is allowed in the applicable zoning district.
4. A planning board cannot deny an application based upon general concerns if specific standards in the zoning ordinance addressing those concerns have been met. (For example, the Hanover Planning Board had denied the proposed IPF on the ground that it was too large and imposing, despite the building’s compliance with the zoning ordinance’s specific provisions relating to a structure’s height and size.)
5. If a use is permitted by the zoning ordinance, it cannot be barred by the site review process unless the use would create unusual public health, safety, or welfare concerns.

The case signals a subtle shift in the New Hampshire Supreme Court in favor of individual property rights (versus a planning board’s regulatory authority). This does not mean that a planning board cannot impose conditions that are reasonably designed to promote the public health, safety, or welfare. But where a proposed project meets the objective requirements of the zoning ordinance, a planning board must base a denial of that project upon specific facts showing a substantial risk of harm to the public health, safety, or welfare.

New Governor, New Era for State/Municipal Partnership

Governor Janet T. Mills is being inaugurated today as Maine’s first female Governor. Municipal officials and leaders throughout the state should expect a more positive relationship between the Governor and the State of Maine and local municipal government during this new administration. As everyone is well aware, despite having been the former Mayor of Waterville, Governor Paul LePage had a very testy and unproductive relationship with municipalities throughout his tenure as Governor. He was generally opposed to revenue sharing for municipalities and went out of his way to foist responsibility onto municipalities for programs and the costs of those programs for which the State historically has taken responsibility. Governor Mills, in her interview with the Maine Municipal Association which occurred prior to the election, made it abundantly clear that she welcomes the support and advice of municipalities and fully intends to restore that relationship and stop the process of shunting costs onto local property tax payers. Since Governor Mills worked her way up through the ranks of local and state politics before becoming Attorney General and finally Governor, she has a keen understanding of what local officials go through and will likely be far more sensitive to those concerns than the previous administration.