Homebuilders jump into N.C. Supreme Court case over disputed Ashe asphalt plant

affordable housing, construction, supply chain, townhomes
  • The N.C. Home Builders Association is sharing its concerns about a recent court ruling against an Ashe County asphalt plant.
  • Home builders say the case addresses "an issue of critical importance to the homebuilding industry."

The N.C. Home Builders Association is taking an interest in a legal fight over a proposed Ashe County asphalt plant. The case addresses “an issue of critical importance to the homebuilding industry,” according to a brief filed Tuesday with the N.C. Supreme Court.

The state’s highest court is slated to take a second look at Ashe County v. Ashe County Planning Board. The case dates back to 2015. It involves a dispute over whether a company seeking to build an asphalt plant secured necessary permits before local officials changed development rules to block the plant.

A trial court and the N.C. Court of Appeals initially ruled in favor of the company, Appalachian Materials, and the local planning board. The county government, which opposed the plant, appealed to the state Supreme Court. In a unanimous December 2020 opinion, the state’s highest court changed course.

The state Supreme Court ruled that lower courts had made a mistake when determining that a letter from the local planning director served as a binding document protecting Appalachian Materials from later changes in local development restrictions.

Justices sent the case back to the Appeals Court, which issued its second ruling on Aug. 2. In a split 2-1 decision, the appellate court’s majority ruled against Appalachian Materials. Justice Chris Dillon dissented, ruling that “AM is entitled to have its permit application considered under the more developer-friendly version of the County’s ordinance in place when AM’s application was submitted in June 2015.”

A key issue in the dispute involves state “permit choice statutes.” They “provide, in general, that if a land use regulation changes between the time a permit application is ‘submitted’ and the time a permit decision is made, then the applicant may choose which version of the regulation applies,” according to Judge Darren Jackson’s majority opinion from the N.C. Court of Appeals.

“The purpose of these provisions is to protect the investment and reasonable reliance of developers on the decisions of local government regarding ‘site evaluation, planning, development costs, consultant fees, and related expenses,’” Jackson wrote. “Our General Assembly has found that they ‘strike an appropriate balance between private expectations and the public interest’ by ‘provid[ing] for the establishment of certain vested rights in order to ensure reasonable certainty, stability, and fairness in the development regulation process, to secure the reasonable expectations of landowners, and to foster cooperation between the public and private sectors in land-use planning and development regulation.’”

Despite this legislative intent, Jackson and Chief Judge Donna Stroud determined that Appalachian Materials had not legally “submitted” its permit application before Ashe County enacted a moratorium and later tightened its development rules. The company had not secured a state air quality permit when it filed the rest of its paperwork.

The state Supreme Court will now review that piece of the dispute.

“This case presents an issue of critical importance to the homebuilding industry because it impacts the extent to which a project can be frustrated by an intervening change in local law,” according to the Home Builders Association brief.

“The purpose of the permit choice statutes is to promote certainty, stability, and fairness in the application of land-development regulations,” the brief added. “However, the Court of Appeals’ holding — i.e., that an application is not ‘submitted’ until all ordinance requirements for approval are met — will undermine that purpose.”

The home builders group cited three major concerns with the Appeals Court ruling.

“First, development permit review is a dynamic process which requires plan amendments and additional submissions in close coordination with local planning staff,” according to the brief. “Certainty and fairness cannot be established in the land-development process unless the applicant can rely on existing ordinances before incurring the time and expense inherent [to]
this dynamic land development planning.”

“Second, the Court of Appeals’ interpretation of the permit choice statutes confers less statutory protection to land development permit applicants than the protections afforded by common law,” home builders argued.

“Finally, the majority’s adopted standard will promote litigation over the application of the permit choice statutes, which is inconsistent with both the manifest legislative intent of those statutes, and this [Supreme] Court’s stated goal of avoiding fragmented litigation over land-use regulation,” the brief concluded.

The state Supreme Court has not yet scheduled the Ashe County case for its second round of hearings.