Development Projects and the Limits of Moratoria

I am always struck at how vigorously some property owners oppose development projects, despite their having previously, and successfully, pursued identical projects. Do they not remember that they did the exact same thing? Is there some definition of fairness I am not aware of? Whatever the cause, it can be exasperating for the developer and detrimental to sound zoning and planning.

A recent case in my small town has really shined a light on just how absurd this can all be.

A landowner, in compliance with state law and as is her right, created a number of lots under the so-called 2 in 5 rule. Subject to a number of exemptions and exclusions, the general rule is that a landowner can create 2 lots in any 5-year period without needing municipal (i.e., planning board) approval. 30-A MRSA section 4401(4):

4. Subdivision. "Subdivision" means the division of a tract or parcel of land into 3 or more lots within any 5-year period that begins on or after September 23, 1971. This definition applies whether the division is accomplished by sale, lease, development, buildings or otherwise. The term "subdivision" also includes the division of a new structure or structures on a tract or parcel of land into 3 or more dwelling units within a 5-year period, the construction or placement of 3 or more dwelling units on a single tract or parcel of land and the division of an existing structure or structures previously used for commercial or industrial use into 3 or more dwelling units within a 5-year period.

For the landowner the benefits of this approach are numerous, but for the most part all revolve around not having to build infrastructure such as roads, sidewalks, electric utilities, water, sanitary sewer, and stormwater infrastructure, as well as not having to set aside or otherwise provide open or common space. For Maine’s relatively “cash poor, land rich” population, the 2 in 5 rule has been a way to monetize their land over time without a lot of upfront development costs or risks.

But back to my town where the land adjacent to this landowner’s 2 in 5 development was bought by a developer “from away,” who applied to the planning board for a residential subdivision approval. Almost a year later, the project is still languishing in front of planning board. The 2 in 5 landowner is now on the planning board and is circulating a citizens petition to enact a 24-month moratorium on any subdivision needing planning board approval. Putting aside the potential conflict of interest issues at play here, a 24-month moratorium is laughably illegal.

State law limits moratoria to a definite term of not more than 180 days. In certain circumstances, a moratoria may be extended for an additional term of not more than 180 days. Moratoria are not intended to simply stop development, but are instead intended to provide a municipality breathing room to thoughtfully look at issues and impacts around development and make evidenced-based policies to guide development.

In order to adopt a moratorium, the municipality must first have evidence that additional development is likely to overburden existing facilities or that there is a shortage of such facilities. What form this evidence takes is subject to some debate, ranging from mere statements from public facilities managers (e.g., school district, water district, sewer district, public works, and so on) to glossy consultant’s reports concluding that existing public facilities are or may be insufficient to adequately address additional development.

The second criteria is that the municipality’s comprehensive plan or ordinances are inadequate to protect resources from serious harm. I find this criteria sort of odd in that municipalities, if they have a zoning ordinance, must enact a zoning ordinance that is in compliance with a comprehensive plan, that, as its principal function is supposed to protect resources from serious harm and guide development in a responsibly and thoughtful way. It might be said that a moratorium allows a municipality to correct an otherwise deficient comprehensive plan.

Anytime a municipality considers a moratorium, it should do so carefully and thoughtfully.

Maine Governor Issues Executive Order Regarding the November Election

Governor Mills has issued a new executive order to facilitate the November 2020 general election. The stated purpose of the order is to ensure the integrity of the ballot and to protect the public health during the COVID-19 emergency. 

The order includes a limit of 50 or fewer people in each polling place and that the statutory minimum number of voting booths are not required if it would make it difficult to have them more than 6 feet apart. Voter lines must be marked to enforce a six-foot separation between voters. Voter registration is modified to allow voters to register 15 days before the election rather than 21 days. Municipalities may consolidate their polling places with a public hearing 30 days prior to election rather than the standard 90 and move polling places with a public hearing 20 days prior to the election rather than 60. The requirement that all polling workers reside in the municipality or county in which they serve is suspended. School budget elections are simplified. Absentee ballots may be processed 7 days before the election, rather than 4. Voters may vote in person by absentee ballot without giving a reason until 5:00 pm on the second business day before the election (Friday October 30). The Secretary of State will help Clerks have secure external boxes to drop off absentee ballots.

What Is the Municipal Liquidity Facility?

There is no question that COVID-19 has had a major impact on state and local governments’ revenue and expenses. To what extent it will impact any particular governmental unit will vary depending on its mix of revenue sources. In an effort to address state and local cash flow pressures and tax revenue shortfalls, the Board of Governors of the Federal Reserve System (the “Federal Reserve”) and the U.S. Treasury established the Municipal Liquidity Facility (the “Facility”). The Facility’s purpose is to support credit and liquidity flow to state and local governments by providing short-term financing to certain governmental issuers. The Facility has the ability to purchase up to $500 billion of debt from impacted state and local governments. The Facility also monitors conditions in the primary and secondary markets for municipal securities in order to determine if any additional action will be necessary. 

Under the Facility, the Federal Reserve purchases short-term municipal notes issued by the states, the District of Columbia, eligible local governments, and Multi-State Entities. Eligible issuers must pay an origination fee of 10 basis points on the principal amount of notes purchased by the Facility. Notes purchased by the Facility may be called by the issuer at par any time before maturity. Unless extended, the Facility will cease buying notes after December 31, 2020. The Facility will be funded until its assets mature or are sold. Through this special purpose vehicle, the U.S. Department of the Treasury will provide $35 billion in initial equity to the program from its Exchange Stabilization Fund, as appropriated under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The remaining funding, up to $465 billion, will come from the twelve regional Federal Reserve Banks.

Eligible local governments include counties with populations of at least 500,000 people, and cities with populations of at least 250,000. In addition, smaller states were given the option to designate a certain number of cities and/or counties to be eligible for the program, even if that city and/or county did not otherwise meet the population requirement. The number of allowed designations depends on the state's size, but the maximum was two designations. As both Maine and New Hampshire were considered to be smaller states, both governors were given the ability to designate a total of two cities and/or counties. Governors that have the ability to designate two Designated Cities and Designated Counties (on a combined basis) may choose any of the following combinations: (i) the most populous city and most populous county; (ii) the most populous city and second-most populous city; or (iii) the most populous county and second-most populous county. Massachusetts was not given the ability to designate any cities or counties based on its size.

In addition, state governors also can designate two "Revenue Bond Issuers" whose revenues are generally derived from operating government activities, such as utilities or airports, that could also sell bonds to the Facility. The municipal debt instruments eligible for purchase by the facility include tax anticipation notes (TANs), revenue anticipation notes (RANs), and bond anticipation notes (BANs), as well as other similar notes. Additionally, eligible debt securities must have terms to maturity of no more than 36 months from their dates of issuance. A given state, county, or city may have multiple entities, authorities, or instrumentalities that issue debt on its behalf. However, the Facility will limit itself to purchasing notes issued by only one issuer per state, county, or city. The Facility also will limit its purchases of notes from a given state, county, or city to an amount equal to 20% of its general revenues during its 2017 fiscal year. However, states may apply for exceptions under which the facility will buy notes in excess of these limits. The Facility is limited to 20% of a Multi-State Entity or Revenue Bond Issuer's gross revenue for fiscal year 2019.

In order to reap the benefits of this program, your municipality must meet the above eligibility requirements or have been specifically designated by the governor of your state as a Designated City or County. While the Facility is limited in eligibility scope and only aimed at new issuance, not secondary market purchases, the establishment of this program generated a positive response in the municipal bond market almost immediately upon its creation.

Parties Close to Settlement of Voting Rights Case

A lawsuit was filed in U.S. District Court on July 17, 2020, against the State of Maine and the Cities of Augusta, Portland, and Bangor and the Town of Winslow, alleging violations of the Americans with Disabilities Act on behalf of four visually impaired voters. The aim of the case is to cause the State and municipalities to implement a system which would allow blind voters to vote absentee without help from their personal computers. A system like this is available in a few other states, including Maryland. The plaintiffs allege that because of COVID, accommodations are necessary to avoid vulnerable citizens having to go to the poll or vote absentee and lose their privacy by having a trusted friend help them vote. A conference was held on July 23 with Judge Woodcock and the parties were given two weeks to work out a deal. The State is willing to implement a remote system for blind people to vote by computer based on a system already in place which allows active duty military to vote remotely anywhere in the world. The more complicated part will be figuring out how to make such a system work for local elections. The problem is that each municipality would have its own unique ballot, which would have to be provided to the vendor early enough to be included. There is expected to be a cost to the municipalities, which is unknown at this time. Preti Flaherty attorneys Laura Rideout and Steve Langsdorf are representing Augusta in this case.

Superior Court Supports Portland’s Home Rule Argument

Justice Kennedy of the Cumberland County Superior Court recently ruled in favor of the City of Portland, giving significant deference to a municipality’s interpretation of its own charter. In the case of Fair Elections Portland v. City of Portland, the Court held that in a disputed factual context the judiciary would defer to the City’s determination that a petition that had been circulated for signatures and presented to the Council to put to the people for a vote, was a charter revision, not an amendment. A revision requires a charter commission and a more extensive process, whereas an amendment may simply be voted on at a municipal election if petitions are properly submitted. The Court implied that she was not convinced that was the proper result but felt constrained due to the deferential standard of review and separation of powers. The continuing lesson is that a municipality is not always compelled to put questions out to vote even if all other standards are met to call for an initiative or referendum. The question may be illegal, inconsistent with the existing charter, or otherwise improper, as here where it purported to be an amendment but was determined to be a revision.

State Issues COVID-19 Guidance Document for Reopening Public and Community Buildings

As part of Phase 2 of the Restarting Maine's Economy initiative, the State yesterday released guidance on safe reopening of municipal and other government buildings. Read the full COVID-19 Prevention Checklist here.

State Ceases Enforcement of Marijuana Business Residency Requirement

The Office of Marijuana Policy issued a letter on May 11, stating that, “Following the advice of the Office of the Attorney General, DAFS and OMP will cease enforcement of the residency requirement included in the Marijuana Legalization Act and the Adult Use Program Rule.” This decision is issued in response to a lawsuit filed against DAFS, which challenged the constitutionality of the requirement under the “dormant Commerce Clause” of the U.S. Constitution.

Many Maine municipalities have adopted marijuana licensing and zoning ordinances which require business owners or applicants to be Maine residents. These were largely considered to be supportive of the existing residency requirements under state law. With OMP and DAFS having concluded that their requirements are void, similar ordinance provisions would also likely be considered unenforceable. Municipalities should work with legal counsel and consider repealing those portions of their marijuana ordinances that require residency. Such requirements will clearly be subject to challenge as local businesses learn of the state’s decision.

NH Governor's Emergency Order Re: Excess Expenditures

Under RSA 32:10, the governing body of a municipality may transfer an unexpended balance in one appropriation to another appropriation, provided that the total amount spent for the year shall not exceed the total amount appropriated at Town Meeting. However, RSA 32:11 provides that when "an unusual circumstance arises during the year which makes it necessary to expend money in excess of an appropriation which may result in an overexpenditure of the total amount appropriated for all purposes at the [town] meeting or when no appropriation has been made," the selectmen may apply to the Commissioner of the Department of Revenue Administration (DRA) to make such expenditure.

Section 4 of Governor Sununu's Emergency Order Number 23 relaxes a number of the requirements of RSA 32:11 which must be met prior to the actual expenditure of monies in excess of an appropriation or of the total amount appropriated at Town Meeting. Specifically:

1. RSA 32:11, I requires that before application to DRA may be made, a majority of the budget committee (or if no budget committee, the governing body) must hold a public hearing. The Governor's order waives the public hearing requirement "during the current health emergency."
2. Under the Governor’s Order, DRA must review the overexpenditure application and notify the governing body of its decision within two business days of DRA's receipt of the application. (RSA 32:11 contains no timeframe within which DRA must notify the governing body of its decision.)
3. Applications to DRA may now be submitted by email to the DRA’s Director of the Municipal and Property Division. 

The Governor’s Executive Order Number 23 may be found at https://www.governor.nh.gov/news-media/emergency-orders/index.htm.

Crazy Times, Even in the Municipal Bond Market

The last few weeks have seen the municipal bond markets feeling the effects of the COVID-19 pandemic. Today, however, the Bond Buyer reported in its “Daily Briefing” that there was some stabilization last week in the municipal bond market.

During the weeks of the worsening of the pandemic, the municipal bond markets saw less investments in municipal bonds and increased sales by holders of existing municipal bonds. With investors in mutual funds holding municipal bonds withdrawing their investments in those funds, those mutual funds in turn were selling the municipal bonds in which they were invested. Compounding this sell-off, mutual funds were not purchasing, at their historical pace, other municipal bonds. This outflow of cash from the municipal bond market, together with a reduced inflow of cash, resulted in lower prices being paid for municipal bonds, leading to increased interest rates being paid by issuers and increased yields to investors. 

Various reasons have been suggested for this change: for example, investor risk assessments associated with municipal bonds may have changed; potential increase in the cost to municipal bond issuers for public support systems; holders seeking to move into cash positions; and general uncertainty. 

Not all issuers and municipal bonds are of equal risk in the current economic environment. Consider, by way of example, that some issuers have sufficient rainy day funds to see them through the crisis; some municipal bonds are supported by a revenue stream that may be less impacted by the pandemic. 

This is all part of the new economic world we are living in and what is written here at this point in time could change by the time you read it.

Maine State Primary Postponed – What to Do About Municipal Meetings and Budgets?

With the news that Governor Mills has ordered Maine’s primary election to be postponed until July 14, many towns are facing a dilemma about whether to postpone their own town meetings and elections. For those towns that like to coincide their local secret ballot meetings with the June primary, on top of the already existing health concerns, this is more reason to push local meetings off until July 14. But what to do about the budget? The Omnibus COVID Bill (LD 2167), provides that if the annual meeting is delayed beyond the date the annual budget is customarily approved, the prior year’s approved budget is deemed the budget for the ensuing year until a final budget is approved. The municipality may even commit taxes based upon last year’s budget, if needed. Schools are also authorized to operate according to the past year’s budget until subsidy numbers are finalized and the state of the emergency is over.

We take this budget extension provision to mean that the town may make operational and administrative expenses in the same amounts, in the same categories, as approved in the prior year. It may also allocate revenues as spelled out in the prior year’s budget. If capital improvement accounts were funded within the last year’s budget and the purpose remains, the town could choose to fund them on a month-to-month basis per the last budget. Alternatively, a cash-strapped town might wait to fund capital improvement accounts and eventually ask the budget meeting to reduce or eliminate the total allocation for the year.

While the COVID bill helps alleviate the pressure to hold budget meetings, it still leaves concerns about how to bridge the gap where the spending authorization remains unchanged from the prior year but revenues may have plummeted due to extended tax deadlines or other economic pressures. Many of our clients are using tax-anticipation notes, which can be borrowed on authority of the municipal officers without the need for town meeting. Others are relying on provisions in the last approved budget which allow the municipal officers to either spend from reserve accounts or appropriate from surplus to fund emergency expenses. In this economic environment, expenditures that previously would not have counted as emergencies probably do now meet that criteria. For towns that don’t have this type of spending authority or enough funding in place, there does remain the possibility of holding a small, special town meeting to make any approvals necessary. Anticipating low turnout, such a meeting still may legally be held, although the town will obviously have to take careful precautions to ensure that attendees are adequately spaced and protected.

Are Stay at Home Orders an Unconstitutional Taking?

In the midst of the COVID-19 pandemic, a question some are asking is whether there is a risk that governments will have to deal with claims that they have unconstitutionally taken value from property owners with the various stay at home edicts, closures, and other similar responses to the pandemic. The short answer is that such claims are unlikely to be successful as long as an ordinance and the local charter are followed, but it is a worthwhile discussion to keep in mind as municipalities consider their response to the pandemic.

The Constitution separates takings into two categories: physical and regulatory. A physical taking is, just like it sounds, when a government takes property away from an owner. It is fairly easy to identify physical takings, such as when DOT or a municipality takes property to build or expand public roads. A physical taking is unlikely – I am not aware of any governmental bodies in the U.S. physically taking property in response to the pandemic – but conceivably a municipality could take a building for quarantine or medical purposes. Should that occur, the municipality would need to pay the owner fair market value of the property taken. Since most of the buildings or spaces suitable for such uses are public buildings or spaces (e.g., the tents in Central Park in New York City), it is improbable that municipalities will need to compensate in such a way. 

On the other hand, regulatory takings could, in theory, apply to certain federal, state and local responses to the pandemic. Certain businesses deemed nonessential and specifically ordered to close undoubtedly will take a financial hit. Hair salons, theaters, and gyms, among others, forced to close could make an argument for lost income as a result of government measures to curb the spread of COVID-19 by claiming governments have violated the U.S. and Maine Constitutions in doing so. The Fifth Amendment provides protection against federal takings, while the Fourteenth Amendment protects against state and local takings.

Given what the CDC, the Maine CDC, and most public and private medical professionals have stated concerning COVID-19, governmental stay at home orders, forced closures, and so on are almost certainly a “valid use of police power,” which powers are given to states under the Tenth Amendment to act for the well-being of the public. The most important thing will be to make sure any emergency actions or orders strictly follow a local emergency planning ordinance and the municipal charter.

DOL Publishes Required FFCRA Poster and Guidance

The federal Department of Labor has released the poster that all covered employers must post to inform them of emergency benefits available under the Families First Coronavirus Response Act (FFCRA). The poster can be found here. Municipalities whose employees are principally working from home during this time should plan to circulate it by email on April 1, the effective date of the Act.

The DOL has also issued helpful guidance regarding the applicability of the Act. However, uncertainty remains and we are happy to answer any questions that arise.

Maine Legislature Passes COVID-19 Omnibus Bill re Public Meetings, Finance, and Other Municipal Concerns

The Maine Legislature last night passed emergency legislation, LD 2167 (referred to as the COVID-19 Omnibus Bill), which addresses many of the concerns being faced by municipalities in this unprecedented situation. Following is our summary of the provisions of this law which impact municipal government:

Public meetings

• During the declared state of emergency, meetings of municipal boards and committees may be conducted remotely by telephone, video, or Internet. The method must be adequate to allow members to hear and speak to one another, and must allow the public to hear what is said.
• Notice must still be provided (we recommend emphasizing web and press announcements during this time, if offices are closed and physical postings are not possible). The notice must include information on how the public may watch and/or participate. Again, remember that you do not need to make provision to accept public comments unless the meeting will include a required public hearing.
• The law does not appear to require that you provide a physical space and phone, terminal, or display where the public can attend in person to watch or listen to the proceedings.
• Votes taken at a remote meeting must be by roll call.

Budget and finance

• Similar to the process for enacting school budgets, the law allows for a municipality that cannot adopt its budget at the customary time to spend according to the prior year’s adopted budget until the current year’s budget can be passed. If these delays continue to the point at which commitment becomes necessary, taxes may also be committed based upon the prior year’s budget.
• During the period of the declared state of emergency and for 30 days after, disbursement warrants may be signed by a majority of the municipal officers with no public meeting required. The implication is that the municipal officers may sign individually with no meeting required.
• If the level of state education subsidy is not finalized before June 1, 2020, the school budget meeting and validation process may be delayed until 30 days after either DOE notifies the school unit of the amount of subsidy or the state of emergency ends. If the budget is delayed under this provision, the school may operate based on the prior year’s budget between July 1 and the date the new budget goes into effect.

Elections

• During calendar year 2020, the municipal officers may postpone a municipal secret ballot election by posting a notice in a conspicuous public location at least two days prior to the election. The notice must either indicate the new date of the election or indicate that the municipal officers will schedule it at a date to be determined. Ballots already printed for that election may be reused for the rescheduled election (despite including the wrong date), and absentee ballots already cast for the election must be held by the clerk and processed on the rescheduled election date.

Employment

• If an employee is laid off as a result of the state of emergency, unemployment benefits paid to him/her will not be charged against the employer’s experience rating.
• Employees will be eligible for unemployment benefits if they are (1) subject to a quarantine or isolation requirement; (2) have been temporarily laid off due to COVID-19 related closures; or (3) are on temporarily leave due to quarantine, isolation, or need to care for dependent family members as a result of COVID-19.

Education

• The Governor and Commissioner of Education may develop a plan to waive compulsory attendance requirements and/or allow remote learning to take the place of in-person instruction requirements.
• The Governor and Commissioner of Education will also implement a plan to continue to provide nutrition services during any period of COVID-19 related school closures.

Other municipal business

• Vehicle registrations, liquor licenses, and dog licenses are deemed extended until 30 days after the end of the state of emergency.
• Vehicle registrants may use the Rapid Renewal program even if their municipality does not already participate.

Municipal COVID-19 Update

We are understandably getting many questions from our municipal clients regarding how to handle public meetings, annual meetings, and public transactions given the Governor’s order prohibiting large gatherings. The other significant area of concern involves questions about how to balance serving the public while protecting your workforce. Several municipalities, including Portland and Augusta, have declared local states of emergency invoking powers only contemplated in times of crisis.

We are expecting that the emergency legislation being considered by the State Legislature tomorrow will include provisions suspending all or some of the FOAA requirements related to public meetings. For now, our best guidance as to how to handle meetings is as follows:

• Postpone non-essential board and committee meetings.
• If a meeting must be held, consider using Facebook Live, YouTube Live, or another streaming service. Remember that the public has the right to view all meetings, but not the right to speak (unless it is an advertised public hearing). For those members of the public who demand to attend in person, reduce risk by spacing out seating and/or providing a secondary room or location where the meeting will be streamed for those who do not have internet access from home.
• Members of boards who are particularly vulnerable due to age or underlying medical conditions may participate in the meeting by phone, Skype, Facetime, etc.. At this time, you should not worry if a quorum or majority of the board is participating remotely.
• (For town meeting towns only) If your annual town meeting falls within the next two months, consider having a special meeting only to make appropriations to fund municipal government as necessary to allow extension of the annual town meeting. Even if your charter requires that the annual meeting be held on a certain date, delay is very unlikely to impact the legality of the meeting whenever it is held. We expect this issue to be addressed by the Legislature.

Employee issues must be dealt with on a case-by case basis with an eye to consistent policies and fair treatment.

We will be in touch tomorrow evening or as soon as possible thereafter with clear, updated guidance following the Legislature’s vote. In the meantime, please do not hesitate to contact us with any questions.

Be well,

Stephen Langsdorf and Kristin Collins

Superior Court Ruling Supports Municipal Authority

Michaela Murphy of the Kennebec County Superior Court recently issued a decision in favor of the Town of Readfield. The case was brought by a property owner whose occupancy permit for a residential structure had been revoked by the Code Enforcement Officer because he had misrepresented its intended use.

 The permit was revoked because the property owner was openly using the site as a commercial concert and events center where it was not allowed per zoning map. The Town also refused to put a rezoning question out for town meeting vote despite receiving the required number of signatures on the petition because the rezoning would have violated the comprehensive plan. 

Justice Murphy ruled in favor of the town on all counts. She strongly reinforced a municipality’s right to revoke a permit when clear misrepresentations had been made regarding its use and the use was in violation of applicable land use restrictions. This is an alternative way to enforce a claim rather than going to District Court for an 80K action. The Court also upheld the Select Board’s right to make a determination that certain questions not be put to a Town meeting vote.

This case was handled by Kristin Collins and Stephen Langsdorf of Preti Flaherty.

NH Supreme Court Clarifies Law Relating to Highways by Prescription

Public highways established by prescription are only those that have been used for public travel for 20 years prior to January 1, 1968. (See NH RSA 229:1.)  In Town of Dunbarton v. Guiney et al. (decided February 5, 2020), the New Hampshire Supreme Court clarified the nature of the proof needed to establish a highway by prescription. The trial court in that case found that a highway by prescription had been established; however, the Supreme Court reversed, finding that there had been insufficient proof as to the “adversity” of the public’s use of the way. 

The Supreme Court first cited the general law that to establish a highway by prescription it must be shown that the general public used the way continuously for a period of 20 years prior to 1968 and that the public use was adverse (i.e., without the owner’s permission). The primary evidence introduced to show the highway by prescription was maps that pre-dated 1968 by more than 20 years. The Court held that the maps, by themselves, were competent evidence to support an inference of continuous and uninterrupted public use but were not sufficient to support a finding that the public use was adverse to the owner over whose property the way traversed. 

The Court held that to meet the adversity requirement, the nature of the use must be such as to show that the owner knew, or ought to have known, that the right was being exercised, not in reliance upon the owner’s permission, but without regard to the owner’s consent. The only evidence introduced in that regard was that the Town had used the area in question to allow its plow trucks to turn around safely. The Court held that this was insufficient to put the owner on notice that the use was adverse and being made under a claim of right by the Town. The Court appeared to establish the standard as whether or not a reasonable person would understand the municipality to be making a claim of right to the property by its use of the way. 

Lessons learned from this recently decided case include: 

1. Maps predating 1968 are insufficient by themselves to meet the “adversity” requirement for establishing a highway by prescription; 
2. There must be some further indication of adversity, of a claim of right without the owner’s permission, such as stone walls or commercial enterprises along the road; and 
3. To establish the requisite adversity, the general standard is whether a reasonable owner would understand the public to be making a claim of right by its use of the way.

Regulating Tiny Homes

On January 30, the Joint Standing Committee on Transportation heard public testimony regarding LD 1981, An Act Regarding the Regulation of Tiny Homes. The concept draft bill proposes to define a “tiny house” and allow for the titling of a tiny house as a camp trailer or trailer.

This bill comes after the Maine State Bureau of Motor Vehicles ceased registering, assigning vehicle notification numbers, and titling tiny homes on wheels in June 2019, preventing tiny home buyers from securing financing from traditional lenders. Prior to June 2019, the Bureau of Motor Vehicles registered and titled tiny homes as camp trailers or trailers under Title 29-A. Owners could freely move their tiny houses as often as they wished. 

Currently, owners of tiny homes must obtain a one-time transit permit from the Secretary of State in order to move their homes. The Bureau of Motor Vehicles has taken the stance that tiny homes do not fall within the definition of a camp trailer or trailer, nor do they fall within the definition of manufactured housing. 

Tiny homes may present an environmentally friendly solution to the rising cost of housing and, for some, play into a desire to live a more minimalist, “off the grid” lifestyle. However, their ambiguous status under state law has traditionally made it difficult to say where they fall under municipal land use ordinances and building codes, and whether they should be taxed as real or personal property. If tiny homes with wheels can be titled and registered as vehicles, this may provide some clarity regarding both issues.

Abandoned Roads: Not Abandoned Yet

This week, the Legislature will hold a public hearing on LD 1415, “An Act to Improve the Laws Regarding Discontinued and Abandoned Roads.” The status of formerly maintained public roads has been (and almost certainly will continue to be) perennially and vociferously debated at the Statehouse. Few issues coming before the State and Local Government Committee raise emotions like former public roads do. Nor are few issues so repeatedly and substantively revisited by the Committee.

Under current law, a presumption of abandonment exists if a municipality fails for a period of 30 or more years to keep a way passable for the use of motor vehicles at the expense of the municipality. LD 1415 eliminates that presumption for ways that have not met that statutory requirement by January 1, 2020, and instead specifies that the only process that a municipality may use to terminate its interests in a public way is through the discontinuance process established in 23 M.R.S.A. section 3026-A.

The public hearing on this bill is scheduled for 11:00 am on Wednesday, January 29, 2020, in the State and Local Government Committee Room.

Bill to Allow Public Sector Strikes Meets Opposition in the Legislature

LD 900, which was introduced in February 2019, and carried over to the short 2020 session of the 129th Maine Legislature, would allow public employees the right to strike. Strikes by public sector employees are illegal by statute in Maine. All that would be necessary is for a majority of the membership of the union to vote in favor within three days prior to the date upon which the strike is intended to start. The bill does not set forth any standards which must be met in order to call a strike. The only exception to the bill is that employees whose duties include public safety would not be allowed to strike. 

If this bill was enacted, it would be a major change in public sector labor law and would dramatically affect the balance of power in Maine between municipalities and other governmental bodies and labor unions. 

It is apparent that the bill will not have an easy time passing at the Legislature. A work session scheduled for January 15, 2020, was cancelled. All indications are that Governor Mills would veto the bill if it somehow passed both the House and Senate. 

To be blunt, this legislation would be devastating for municipalities and would have a detrimental effect on employee relations. You are urged to let your Legislative representatives know that you as a municipality or other public sector employer are opposed to this potential legislation.

An Introduction to Green Bonds

For starters, “green bonds” are not issued pursuant to any governmental program like, for example, the federal program for Qualified School Construction Bonds. Rather, the issuer of a bond requests a non-governmental organization to evaluate (there is a fee involved) the project being financed to determine if those bonds are eligible for a green bond designation. 

Green bonds are attracting investors with an appetite or need to invest in projects that have positive environmental effects. There is no subsidy or credit associated with a green bond designation, but there is potentially a marketing advantage that could lead to lower costs – in particular, lower interest costs. 

Over time, the process for attaining green bond status is becoming more uniform. For example, Climate Bonds Initiative (www.climatebonds.net) and S&P Global Ratings (www.spglobal.com) have programs for evaluating eco-friendly projects. Just last year, the City of Portland obtained a green evaluation score from S&P Global Ratings in connection with refunding certain of its 2010 bonds. The bonds were issued in connection with a U.S. Green Building Council Leadership in Energy and Environmental Design (“LEED”) Gold Certified Jetport terminal expansion project. While the “green bond” designation was related to the LEED certification, S&P Global Ratings evaluated and scored the environmental benefits. 

Next time your municipality is considering financing or refinancing an eco-friendly project, including a green construction, transportation, water, waste, or energy-efficient project, it might be worthwhile investigating the benefits of a green bond designation.