Rafael Eloy Montero Gosálbez
Lawyer, MBA, PMP
The new Valencian Region’s Urban Planning Law, that the current Valencian Government leaves us as a farewell before the election, contains many new features. However, not all of them have been addressed. As a matter of fact, it seems that so far new features have been explained in inverse proportion to its relevance.
In this paper I want to talk about what is new and remarkable for me, emphasizing its effects on their “target audience”.
The media has spoken of the extension of time for restoration actions against illegal constructions. The term the Town Council has to push your constructions into legality again goes from 4 to 15 years, although the term in which is possible to be amended remains in four years.
The practical consequence of this is that, even after a lapse of four years after an unlicensed construction work, when City Council can no longer punish you for those works, they still have another 11 years to force you to legalize or demolish those unlicensed works. The City Council could even demolish it at the expense or in replacement of the required people, alwais after several penalties.
This measure seeks to provide local administration with useful tools for the maintenance or the restoration urban law.
This situation will definitely affect many decisions regarding renovations in homes and offices, and even trading decisions, because of the legal uncertainty caused by the lack or inadequacy to building permits extends its effects for 15 years.
Another discussed new feature is the separation of Master Plans in two instruments, one of regional approval, where the structure of the territory, the outlines of city planning and its relevance to regional territorial policy are stablished, and other documents which is approved by the City itself, with details of urban planning.
This is a more theoretical than real innovation, because it really does not change the situation. A modification of the Master Plan that now doesn’t needs regional authorization, neither needed it with the previous law. This is an innovation that seeks, in line with the responsibilities bestowed by law to the different public administrations, to clearly separate areas of decision and, mainly, speed up the regional approval process of urban planning.
Regarding the novelty of condensing precedent rules in a code, it is undeniable that represents an improvement and a regulatory simplification that will help legal interpretation by professionals.
It is also illustrative, and helpful –and waited-, the integration of environmental assessment regulations with urban development law. However, it means longer procedures for land planning even greater than those that had been given so far.
These are the changes that have been more or less explained. Now we will enter into unexplained modifications.
One of them is the preference of urban development by the owners, without competitive selection of tenders in urban development actions, rather than the selection of a development agent. Owners are given the right to even subrogate to the position of the person who starts an urban development action, during the consultation phase, so that they are granted with the possibility of restricting private investments in the development of urban planning.
Other novelty, also highly relevant for practical purposes, is the changing of the standard for administrative silence in granting construction permissions. From now, almost in every case the requests are denied in the case that City Council doesn’t answers in time. It is called “negative silence”, which gives more control to the local administration in exchange for lower agility.
Among the news shortly explained, we can find one which for me is the most important of all, in terms of urban policy.
The case is as follows. The Valencian legislator has decided to separate into two different calls for proposals urban planning and selection of the corporation in charge of development.
This, that from the point of view of urban logic is praiseworthy, dramatically complicates the management, because urban plannig documents should be modified, monitored and implemented within the framework of a strategic environmental assessment without a designated development agent, even provisionally, leaving in limbo the of designation of corporations in charge of this task, because we cannot start its selection procedure without the Environmental and Territorial Strategic Statement approved by the regional administration.
The question is: who takes in charge of the costs of processing since the urban planning is preselected by the City until the strategic and environmental framework is set by the regional government?, who develops the technical work?, the City or proponent whose project is preselected (his project but not him), who could be working for years without having been appointed as developer, even provisionally, when may be another contestant could be finally selected?
Hitherto, the dual municipal one-time decision of provisional planning approval and designation of development agent, allowed developers to work and invest with legal and economic security that today lacks.
The current legal setting, in my opinion, may indeed discourage, indeed, urban management initiatives set by private companies, except if it is done from the perspective of developer participation as major owners. This represents a decline not only in legal agility but also in terms of respect of European public procurement law.
Along with this is the increasing requirement of securities, from now equal for private management initiatives and for public corporations, makes more complex developments by municipal public firms.
We will have to oversee the development of the facts, to see whether Government is trying to stop the processing of new land, being as it is a stated interest of the Act the preferential management of existing city, or if the aim is to encourage urban management by Public Private Partnerships, underexploited formula so far, given his prior poor regulation.
The Government opens the door to joint venture urban management, formula that so far, required complicated layouts that directly applied Spanish public procurement law and European Directives, in conflict with the Valencian urbanism laws.
Now, this joint venture is expressly stated as a possible, and competitions for projects and developments agent are replaced by the selection, following public procurement laws, of a partner providing capital and expertise, while public administration is able to maintain control of operations.
However, the opportunity to set up this joint venture management as a special contract, which also reached the execution of the construction work, has been lost, since law requires contracting these works at a later competition.
Therefore, the interest of companies to form joint ventures is going to be measured at the return of urban development operations, but without adding the profit of infrastructure works. This situation will curb the interest in this formula compared to the one it might have had.
Along with this, the Valencian Government forgets the barriers brought by the new version of the Local Government Law (7/85 LRBRL) to establish public corporations, and the express prohibition to public companies of creating subsidiaries.
Despite all this, given the difficulties set out both for public management and private companies, this, Public Private Partnerships, and no other, seems to be the key of the new urban management, at least on paper.
Rafael Eloy Montero Gosálbez
Lawyer, MBA, PMP ®