Permit Extension Act Extended Once More in Massachusetts

The development community within the Commonwealth was the recipient of a welcome benefit following Governor Deval Patrick’s signature of the “Jobs Bill” on August 7, 2012.  The Jobs Bill, otherwise known as “An Act Relative to Infrastructure Investment, Enhanced Competitiveness & Economic Growth in the Commonwealth,” contains provisions that extend the Permit Extension Act (Section 173 of Chapter 240 of the Acts of 2010) and makes the extensions granted available to a larger number of permit holders (Sections 74 and 75 of Chapter 238 of the Acts of 2012).

In response to the slowdown in real estate development activity since 2008, in 2010, the Commonwealth enacted legislation extending the term for execution of permits, orders, variances and other forms of state and local governmental approval relevant to the development of real property for an additional period of 2 years from the date upon which a protected permit would have expired by its terms.  The 2010 legislation applied to permits issued during the period beginning August 15, 2008 and continuing through August 15, 2010.  The recently enacted legislation improves the position of existing permit holders in two ways: first, those permits benefiting from the 2010 legislation are extended for an additional 2 year period, providing affected permit holders with a period of 4 years from the stated date of expiration of covered permits within which to undertake the work contemplated thereby.  Second, permits issued subsequent to August 15, 2010 through August 15, 2012 are now covered by the statute, providing affected permit holders with the ability to move forward on the permitted activity at any time through and including the last day of the 4^th year after the stated date of expiration of the subject permit.

While the legislation is broad in its applicability, permits issued by the federal government or any United States agency are unaffected by this state Act, as are permits issued under sections 20 to 23, inclusive of chapter 40B of Massachusetts General Laws (relating to zoning approvals with respect to low or medium income housing), and any permit issued by the division of fisheries and wildlife under Chapter 131 of Massachusetts General Laws (protecting certain wildlife species).  Note permits issued under Chapter 131A the Massachusetts Endangered Species Act (MESA) are included in the Act.

For many developers, the extension of time and the increased applicability of the extension to permits issued subsequent to August 15, 2010 will provide the opportunity to extend timelines to accommodate continued caution in the financial markets and the affect of the current economic climate on industry sectors and construction starts.