As the housing industry seeks to recover from the worst economic downturn since the Great Depression, some local governments are choosing not to renew land-use approvals on subdivisions that have been delayed by the weak economy.

In many cases, the land reverts to its original zoned use — often farmland — and this dramatically lowers the value of the land, which can cause significant losses for the developer and the bank that provided the financing.

These reversions are also frequently resulting in the loss of significant plan approval costs — including expenditures for environmental assessments, engineering consultants and traffic impact analyses.

NAHB is trying to determine the extent of this problem and would like to hear from those who have seen it occur in their own market. E-mail Blake Smith at NAHB, or call him at 800-368-5242 x8583.

Several states have already enacted laws to ensure that permits on delayed subdivision projects can be extended, including Virginia.

“The law has saved our members a significant amount of money by not requiring them to move forward on a project when there is no demand in today's market,” said Mike Toalson, chief executive officer of the Home Builders Association of Virginia.

House Bill 2077, which was signed into law in Virginia by then-Governor Tim Kaine in 2009, extends until July 1, 2014, the validity of residential and commercial preliminary and recorded subdivision plats and final site plans filed as of Jan. 1, 2009. It applies to subdivision plats, plots, preliminary plans, final plans, conditional use permits, special use permits, special exceptions, construction plans, public improvement plans and site plans.

The five‐year extension also applies to certain types of proffers that are conditioned upon future development activity as opposed to arrival of a date certain. Any select proffer that was valid and outstanding as of Jan. 1, 2009, has been extended for a period of five years from its current expiration date.