Home Builders Association of Virginia
Representing Virginia's Residential Land Development and Construction Industry
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Legislative & Regulatory Update - September, 2019

This month's update includes:

  • Housing News
  • 2018 Code Development Cycle
  • Virginia Submits Phase III WIP to the U.S. EPA
  • Consolidation of the Virginia Stormwater Management Act and the Virginia Erosion and Sediment Control Law
  • Virginia Housing Commission's Proffer/Impact Fee Work Group
  • Chesapeake Bay Preservation Work Group
  • Washington Post - HBAV: Addressing VA's Affordable Housing Crisis
  • 2019 State of the Nation's Housing Report
Housing News


Here's Why Housing is So Expensive : " “I have to spend $80,000 before I can drive one nail into a piece of wood....And you wonder why homes have become unaffordable?”

Governor Announces Administration Appointments : Governor Northam recently announced two appointments to the Virginia Board of Housing and Community Development (BHCD). Among other responsibilities, the BHCD is responsible for evaluating changes to Virginia's building and fire codes. Governor Northam appointed Brett Meringoff of WinnDevelopment Comp any and Patricia Shields of Metro Green Home Builders. Brett will be replacing JP Carr of Glaize Developments - because each appointment is term-limited, JP was not eligible for re-appointment. We'd like to sincerely thank JP for his eight years of service to the Board! Patricia has served on the Board for several years and was eligible for reappointment.

Military.com: "Navy Housing Survey Shows Poor Rank for Virginia's Hampton Roads"

Realtor Magazine: Unlocking Inventory : " Your sales volume should be higher. To some extent, the reason it isn’t lies with the persistent housing shortages nationwide"

Washington Post (Perspectives Page): "Why do so many affordable housing advocate rejects the law of supply and demand?"

Washington Post : "Area residents, not Amazon newcomers, are fueling Northern Virginia real estate frenzy, agents say"
2018 Code Development Cycle
Earlier this year, the Department of Housing and Community Development (DHCD) began the 2018 Code Update Cycle. Stakeholders have submitted numerous proposals related to fire sprinkler requirements, energy efficiency, rehabilitation of existing buildings, fire codes, and building codes. DHCD formed several workgroups comprised of building officials, fire officials, local governments, private sector representatives, and other interested parties to begin reviewing proposals. These workgroups are responsible for making recommendations (consensus vs. non-consensus) to the Board of Housing and Community Development. 

The Board of Housing and Community Development will hear the first round of code proposals later this month. HBAV has formed a committee to review and provide input to HBAV staff on each of the code proposals.

We will provide additional updates at the conclusion of the preliminary phase of this regulatory process. If you would like to review the proposals that have been submitted and discussed by the workgroups, you can sign up for a free cdpVA account here . You can also email Andrew Clark at [email protected].
Virginia Submits Phase III WIP to the EPA
Two weeks ago, Governor Northam submitted the Commonwealth’s Final Draft of the Phase III Watershed Implementation Plan (WIP) to the US Environmental Protection Agency (EPA). In 2010, the EPA established the Chesapeake Bay Total Maximum Daily Load (TMDL) to address pollution threatening the waterways in the Chesapeake Bay and restore the region’s watershed, streams, creeks, and rivers. The Phase I, II, and III WIPs have been developed by each watershed jurisdiction to achieve the TMDL for nitrogen, phosphorus, and sediment. The Phase III WIP, which is the result of an extensive stakeholder review process, will guide local, state, and federal actions through 2025 to reduce nutrient and sediment pollution.



Over the next several months, the EPA will be reviewing Virginia’s (and other states’) WIPs to determine if additional information/action is needed to meet their standards.
DEQ Consolidation Regulatory Advisory Panel
During the 2016 General Assembly Session, HB 1250 and SB 673 were introduced to combine the existing Virginia Stormwater Management Act (VSMA) and the existing Virginia Erosion and Sediment Control Law (VESCL) to create the Virginia Erosion and Stormwater Management Act (VESMA). The legislation also directed the State Water Control Board to permit, regulate, and control both erosion and stormwater runoff. In order for this legislation to become effective, the Board is required to initiate a regulatory action to consolidate and clarify program requirements, eliminate redundancies, and correct inconsistencies between the erosion and sediment control and stormwater management program regulations to implement the Virginia Erosion and Stormwater Management Program (VESMP). Affected regulations may include: 9VAC25-830 – Chesapeake Bay Preservation Area Designation and Management Regulations; 9VAC25-840 – Erosion and Sediment Control Regulations; 9VAC25-850 – Erosion and Sediment Control and Stormwater Management Certification Regulations; 9VAC25-870 – Virginia Stormwater Management Program Regulation; 9VAC25-880 – General VPDES Permit for Discharges of Stormwater from Construction Activities; and 9VAC25-890 – General VPDES Permit for Discharges of Stormwater from Small Municipal Separate Storm Sewer Systems.
 
To implement the consolidation, the Department of Environmental Quality (DEQ) formed the Consolidation Regulatory Advisory Panel (RAP) – the Home Builders Association of Virginia was selected to represent the industry on this RAP. This RAP will focus on 1) program consolidation per the Virginia Stormwater Management Act and 2) clarify or eliminate redundant or conflicting programmatic regulations such as exemptions and definitions. The RAP will NOT focus on modifying the stormwater technical criteria or ESC minimum standards, BMP specs, VESCH, or other substantive changes.
 
If you have any comments or input that you would like HBAV to raise at future RAP meetings, please contact Andrew Clark at [email protected].
Virginia Housing Commission: Proffer/Impact Fee Work Group
During the 2019 General Assembly Session, the Home Builders Association of Virginia (HBAV) successfully passed SB 1373 (Favola) and HB 2342 (Thomas) to address concerns of our members and local governments as a result of the passage of the 2016 Proffer Law. In short, the 2019 legislation sought to 1) re-open the lines of communication between applicants and local governments during the development review process and 2) expand flexibility for applicants and local governments to discuss and agree upon different types of on-site and off-site proffers. Both bills passed the General Assembly with overwhelming bipartisan support, were signed by the Governor, and became effective July 1, 2019. 

Although many local governments felt that the proposed changes were a substantial improvement from the 2016 legislation, there were some stakeholders who felt that the 2019 legislation did not go far enough; and several other stakeholders who wanted to expand Virginia’s current impact fee enabling statutes. As a result, HBAV agreed to participate in several meetings of a workgroup of the Virginia Housing Commission focused solely on Proffers and Impact Fees – the purpose of this workgroup would be to discuss the challenges that were faced with the 2016 Proffer Law, provide feedback on the 2019 amendments to the Proffer Law, solicit input on any additional changes to the proffer law, and gauge stakeholder interest in pursuing the expansion of Virginia’s impact fee enabling statute.

The workgroup was comprised of individual local governments, residential and commercial real-estate industry representatives, the American Planning Association, the Virginia Coalition of High Growth Communities, Virginia Association of Counties, Virginia Municipal League, and other stakeholders. On June 10 th and July 8 th , the workgroup heard testimony from Albemarle, Loudoun, and Goochland counties, the Virginia Coalition of High Growth Communities, HBAV, Virginia Association of Realtors, Virginia Association for Commercial Real Estate, and the American Planning Association. 

You can find a copy of HBAV's presentation to the workgroup here . 

In summary, HBAV held the position that:

  • The 2019 Proffer Law was drafted with significant input from local governments, members of the housing industry, and stakeholders – and it sought to address many of the concerns that we’ve heard over the last several years re: the 2016 Proffer Law.

  • The 2019 Proffer Law was the second significant change to the proffer statutes in three years –because the 2019 Law was fairly well received by all stakeholders, it would be premature to consider or propose additional changes to the proffer law in upcoming General Assembly Sessions. Local governments and industry need the opportunity to enact ordinances to implement the legislation and work through residential rezoning applications.

  • There are various perspectives on whether cash proffers or impact fees are the right policy for Virginia. Impact Fee statutes can be fairly complex, with a lot of policy considerations that would need to be discussed by the stakeholders in advance (see attached presentation). Right now, we should focus on implementing the 2019 Proffer Law and getting rezoning applications submitted and processed.

  • The 2019 Proffer Law made a lot of progress in finding ‘middle ground’ between industry and local governments; in most regions of the Commonwealth, the gap between housing supply and demand continues to grow – we need to focus our legislative efforts on increasing housing supply and affordability and let the 2019 Proffer Law play out.

Ultimately, there was consensus among the Housing Commission Proffer/Impact Fee Work Group to NOT recommend any additional changes to the 2019 Proffer Law during the upcoming General Assembly Sessions – and to allow local governments and industry an opportunity to work through the new provisions of law locally. There was also consensus among the group that our efforts, at this time, would be best spent on addressing the housing shortage in many regions of the Commonwealth. The Work Group also agreed that additional meetings were not necessary at this time and we committed to keeping the lines of communication open between local governments and the residential and commercial development industry. We were very pleased with this outcome, as were many other stakeholders at the table. 
 
Here is a brief overview of some of the other key takeaways from the work group meetings:

  • Some local governments and other stakeholders did not support the 2016 Proffer Legislation – it stifled or shut down communication between applicants and local governments; it was difficult to implement; it limited flexibility.
  • Local governments and other stakeholders believed that the 2019 Proffer Law made substantial improvements to the statute; some local governments stated that the 2019 legislation didn’t accomplish everything that they had hoped but did recognize that there was a lot of positive things in the legislation. 
  • Local governments are currently working with industry to implement the new proffer law
  • Some local governments and stakeholders expressed a desire to explore ways to expand Virginia’s impact fee enabling statute – however, there was not consensus among local governments and stakeholders on several fronts, including whether Virginia should give localities the option to implement impact fees and/or cash proffers; how much authority the General Assembly should give local governments to craft local impact fee ordinances; and various other policy considerations that go into developing an impact fee statute.
Chesapeake Bay Preservation Act Working Group

In April, Governor Northam’s Administration released the Commonwealth’s Draft Phase III Watershed Implementation Plan (“Phase III WIP”) for meeting the Chesapeake Bay Total Maximum Daily Load. The Phase III WIP includes a provision to establish a work group to develop recommendations for extending the beneficial management measures established under the Chesapeake Bay Preservation Act to areas west of Interstate 95.

The workgroup will consider identifying, mapping, and protecting sensitive natural resources on lands west of I-95, protecting water quality through local land use planning and decisions, ensuring septic pump outs are increased to equal 20% of all systems in the Bay watershed being pumped in a year, determining financial and technical assistance needs of local governing bodies west of I-95, and existing state and federal programs that provide water quality protections. The workgroup will also review implementation and oversight of the existing CBPA with a focus on identifying and recommending improvements. Governor Northam’s Administration asked HBAV to serve on this workgroup which held its first meeting in early July.

For more information, please contact Andrew Clark at [email protected]
Additional Legislative/Regulatory Resources


Washington Post - HBAV: Addressing Virginia's Affordable Housing Crisis

Two weeks ago, the Home Builders Association of Virginia (HBAV) was featured in Sunday's  Washington Post's Local Opinion Page  highlighting the emerging affordable housing crisis in Virginia.

We hope that you will take a moment to share HBAV’s piece from the Washington Post with your local media outlets, candidates for state and local office, your local Chamber of Commerce, and other local business organizations! 

The Local Opinion piece from HBAV can be found  here .


The 2019 State of the Nation's Housing Report

The Harvard Joint Center for Housing Studies recently released their 2019 State of the Nation's Housing Report. This is one of the most comprehensive national assessments of the nation's for-sale and rental housing market and industry.

"Although household growth is returning to a more normal pace, this year's State of the Nation's Housing report shows that housing production still falls short of what is needed, which is keeping pressure on house prices and rents and eroding affordability. While demographic trends alone should support a vibrant housing market over the coming decade, realizing this potential depends heavily on whether the market can provide a broader and more affordable range of housing options for tomorrow’s households."