Can a Virginia landowner change the approved use of a cash proffer accepted before 2016 without going back to the governing body, and does an amendment require a public hearing?

Plain-English summary

A "proffer" is a voluntary commitment by a landowner during a conditional rezoning to limit how the property will be used or to contribute resources (land, infrastructure, cash) to offset the development's impact. Once the local governing body accepts a proffer, it becomes part of the zoning ordinance and is enforceable like any zoning regulation. Cash proffers in particular were a substantial revenue stream for Virginia high-growth localities until the 2016 proffer reforms (Code § 15.2-2303.4) significantly restricted them. The 2016 reforms apply prospectively only, so older proffers accepted before July 1, 2016 continue to operate under the older rules.

Senator Chase asked two questions. First, can a landowner unilaterally change the approved purpose of a pre-2016 cash proffer? Second, if a change is permitted, must the local governing body hold a public hearing?

The Attorney General said:

Unilateral change: No, not unilaterally. Approved proffers bind both the locality and current and future landowners. Two statutes carve out narrow situations where the locality can approve alternative use of a cash proffer without a new application from the landowner. Code § 15.2-2298(A) applies to certain high-growth localities and requires the proffer itself to provide for an alternative if it is not used for its original purpose. Code § 15.2-2303.2 lets a locality use cash proffers for road improvements as matching contributions for VDOT projects, or for alternative capital improvements of the same category within the vicinity of the original improvements (with notice to the proffer payer and a public hearing). But when the landowner wants to change the use, the landowner has to apply for an amendment to the proffer under Code § 15.2-2302, which is a zoning-ordinance amendment.

Public hearing: Generally yes. Under Code § 15.2-2285, before approving any zoning ordinance amendment, the governing body must hold at least one public hearing with notice as required by § 15.2-2204. Section 15.2-2302 specifically governs landowner-initiated proffer amendments and requires written notice in the manner prescribed by § 15.2-2204(B). A public hearing is required except: (1) where the amendment does not affect conditions of use or density (the governing body may waive the public hearing), and (2) when reducing, suspending, or eliminating outstanding per-dwelling-unit or per-home cash proffers agreed to but unpaid.

Currency note

This opinion was issued in 2018. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here. Particular note: Virginia's proffer law has continued to evolve since 2016, including subsequent amendments to § 15.2-2303.4.

Background and statutory framework

Code § 15.2-2296 authorizes Virginia localities to use conditional zoning, allowing rezoning subject to conditions proffered by the zoning applicant. The Supreme Court of Virginia in Hale v. Board of Zoning Appeals defined proffers as "voluntary commitments made by landowners in order to facilitate approval of conditional zoning and rezoning requests by ameliorating the impact of development of their property on the local infrastructure and the character and environment of adjoining land."

Three statutes authorize different forms of proffers depending on locality type. Code § 15.2-2297 covers most localities and prohibits cash contributions. Code § 15.2-2298 covers certain "high-growth" localities and authorizes cash proffers. Code § 15.2-2303 covers other named localities. The 2016 proffer reforms (Code § 15.2-2303.4, enacted by 2016 Va. Acts ch. 322) tightened restrictions on accepting proffers for "new residential development" and "new residential uses," but applied prospectively only to applications filed on or after July 1, 2016.

Once accepted, a proffer is part of the zoning ordinance. Town of Leesburg v. Long Lane Associates (2012) confirmed that "voluntary proffers, such proffers become conditions of the rezoning and, once entered into law, the conditions become zoning regulations." That makes amendment a zoning-ordinance amendment, subject to the public-hearing and notice rules in Title 15.2 Chapter 22.

The two statutes giving the locality discretion to redirect cash proffers without a new landowner application are narrow. Code § 15.2-2298(A) applies when the original proffer text itself "provide[s] for the disposition of the property or cash payment in the event the property or cash payment is not used for the purpose for which proffered." Code § 15.2-2303.2 has two distinct mechanisms: (i) using road-improvement cash proffers as VDOT matching contributions, and (ii) using cash payments proffered for capital improvements for "alternative improvements of the same category within the locality in the vicinity of the improvements for which the cash payments were originally made." The latter mechanism requires written notice to the proffer payer and a public hearing.

For landowner-initiated amendments, Code § 15.2-2302 controls. Subject to public notice and hearing requirements, "any landowner subject to conditions proffered ... may apply to the governing body for amendments to or variations of such proffered conditions provided only that written notice of such application be provided." A public hearing is required unless the amendment does not affect use or density (in which case the locality may waive it), or unless the amendment reduces, suspends, or eliminates outstanding per-dwelling-unit cash proffers (a 2016-era policy lever).

Common questions

What exactly is a cash proffer?
A voluntary commitment by a landowner during conditional rezoning to pay cash to the locality, typically used to fund road improvements, school construction, or other public infrastructure needed to support the new development. Cash proffers became controversial in the 2010s as Virginia high-growth counties used them aggressively.

Can the locality change the use of a cash proffer without telling the landowner?
Yes, in limited circumstances. Under § 15.2-2298(A), if the proffer's own text contemplates an alternative use, the locality can apply the alternative. Under § 15.2-2303.2(C), the locality can use cash payments for "alternative improvements of the same category within the locality in the vicinity of the improvements for which the cash payments were originally made," but the locality must give the payer written notice and hold a public hearing.

Can the landowner force the locality to redirect a cash proffer?
No, not unilaterally. The landowner must apply for an amendment to the proffer conditions under § 15.2-2302, which is a zoning-ordinance amendment requiring local governing-body approval. The landowner cannot just direct the locality to spend the money differently.

Is a public hearing required for every proffer amendment?
Generally yes. Code § 15.2-2285 requires a public hearing before any zoning ordinance amendment. Section 15.2-2302 permits two waivers: (1) when the amendment does not affect conditions of use or density, and (2) when the amendment reduces, suspends, or eliminates outstanding unpaid per-dwelling-unit or per-home cash proffers.

Do the 2016 proffer reforms apply to my pre-2016 proffer?
No. The 2016 amendments (Code § 15.2-2303.4) apply prospectively only to applications for "new residential development" and "new residential uses" filed on or after July 1, 2016. Pre-2016 proffers continue to operate under the prior framework. If a landowner files a proffer condition amendment after July 1, 2016 for a development that qualifies as a "new residential use," the 2016 reforms may apply to the amendment.

What is a "dedicated credit" or "credit" in proffer language?
Some local cash-proffer policies allow landowners to substitute land dedication or in-kind infrastructure construction for some or all of a maximum cash proffer. The opinion notes this concept (from Chesterfield County's policy) but explicitly does not address it: "This opinion does not address requested changes in proffers relating to the use of dedicated land or the construction of public infrastructure."

Does this opinion apply to non-cash proffers?
The opinion focuses on cash proffers, but the general framework about how proffers become part of the zoning ordinance applies to all kinds. Land-dedication and infrastructure-construction proffers would still be governed by Code § 15.2-2302 if the landowner wants to amend them, but the specifics of alternative-use authorization differ.

Citations

• Va. Code § 15.2-2296 (conditional zoning authority)
• Va. Code § 15.2-2298 (cash proffers in high-growth localities)
• Va. Code § 15.2-2302 (amendments to proffered conditions)
• Va. Code § 15.2-2303.2 (alternative use of cash proffers by locality)
• Va. Code § 15.2-2303.4 (2016 proffer reforms)
• Va. Code § 15.2-2285 (public hearing requirement)
• Hale v. Board of Zoning Appeals, 277 Va. 250 (2009)
• Town of Leesburg v. Long Lane Assocs. Ltd P'ship, 284 Va. 127 (2012)
• 2016 Va. Acts ch. 322

Source

• Landing page: https://www.oag.state.va.us/annual-reports-opinions/official-opinions
• Original PDF: https://www.oag.state.va.us/files/opinions/2018/Issued-opinion-Sen-Chase-18-035.pdf

Original opinion text

COMMONWEALTH of VIRGINIA
Office of the Attorney General
Mark R. Herring
Attorney General

November 2, 2018

The Honorable Amanda F. Chase
Member, Senate of Virginia
Post Office Box 5811
Midlothian, Virginia 23112

Dear Senator Chase:
I am responding to your request for an official advisory opinion in accordance with § 2.2-505 of
the Code of Virginia.

Issues Presented
You ask two questions regarding the administration of proffers: (1) whether a cash proffer that
was approved by a local governing body prior to the codification of § 15.2-2303.4 in 2016 ("the 2016
Amendments")[1] can be used by a developer[2] for a different purpose than that which the governing body
approved. Additionally, you ask whether the proposed alternative use, if permissible, requires approval
by the local governing body after a public hearing.

Applicable Law and Discussion

1. Background
   The General Assembly has authorized localities to adopt conditional zoning in order "to provide a
   more flexible and adaptable zoning method ... , whereby a zoning reclassification may be allowed
   subject to certain conditions proffered by the zoning applicant for the protection of the community that
   are not generally applicable to land similarly zoned."[3] Conditions offered by the applicant are also known
   as "proffers," a term which has been defined by the Supreme Court of Virginia as "voluntary
   commitments made by landowners in order to facilitate approval of conditional zoning and rezoning
   requests by ameliorating the impact of development of their property on the local infrastructure and the
   character and environment of adjoining land."[4]

Proffers can take many forms, including dedication of real property or interests therein,
construction of public improvements, or, in certain localities, monetary contributions.[5] Once the local
governing body approves a conditional rezoning application and accepts the proffers as offered, the
conditional zoning, including the proffers, then constitute an amendment to the zoning ordinance.[6]

The 2016 Amendments, which impose more stringent criteria on the acceptance of proffers by
localities, apply prospectively only to applications for "new residential development"[7] and "new
residential uses"[8] filed on or after July 1, 2016.[9]

2. May a landowner change the approved use of a cash proffer from that which was specified in the
   proffer accepted prior to July 1, 2016?

Your question addresses whether a cash proffer[10] accepted by a local governing body before the
effective date of the 2016 Amendments can subsequently be changed at the request of the landowner
without submitting an application for amendment to the locality. For the reasons that follow, it is my
opinion that under most circumstances, the landowner is required to submit a proffer amendment to the
governing body for approval of an alternative use.

It is well settled in Virginia that "proffers, once accepted, have the force of law that will bind both
the local government and the current and future owner of the property to their terms."[11] Approved proffers
will continue in effect until a subsequent amendment, other than a comprehensive new or substantially
revised zoning ordinance, changes the zoning on the property.[12] Further, as noted above, the 2016
Amendments do not supersede existing, accepted proffer conditions.[13]

An alternative use of an existing, accepted cash proffer is permitted by statute, without
application by the landowner, in two instances. First, § 15.2-2298(A), which is applicable to certain
"high-growth" localities, states that "[i]f proffered conditions include the dedication of real property or
the payment of cash, the proffered conditions shall provide for the disposition of the property or cash
payment in the event the property or cash payment is not used for the purpose for which proffered."[14] It is
the locality, and not the landowner, which collects and expends cash proffers and determines whether
they may be used for an alternative purpose other than as expressly stated in the proffer.[15]

Second, § 15.2-2303.2 provides that unless prohibited by a proffer agreement, a locality may
utilize cash proffers for road improvements as a matching contribution for certain transportation
improvements funded by the Virginia Department of Transportation.[16] The statute also permits localities
to "utilize any cash payments proffered for capital improvements for alternative improvements of the
same category within the locality in the vicinity of the improvements for which the cash payments were
originally made."[17]

These statutorily sanctioned alternative uses of cash proffers are made at the discretion of the
local governing body and do not require the landowner to file an application for amendment of the
original proffer. Where it is the landowner proposing an alternative use of a cash proffer, however, such
alternative use will require an amendment to the zoning ordinance, submitted to and approved by the local
governing body.[18]

3. Public Hearing Requirement
   Your next question addresses whether an application by the landowner to use cash proffers for
   alternative purposes must be approved by the local governing body after a public hearing. Virginia Code
   § 15.2-2285 states in relevant part that

[b]efore approving and adopting any zoning ordinance or amendment thereof, the
governing body shall hold at least one public hearing thereon, pursuant to public notice as
required by § 15.2-2204, after which the governing body may make appropriate changes
or corrections in the ordinance or proposed amendment.[19]

Once "the governing body accepts voluntary proffers, such proffers become conditions of the
rezoning and, once entered into law, the conditions become zoning regulations."[20] Thus, a change to an
approved proffer initiated by the landowner would constitute an amendment to the zoning ordinance, and
in most instances, the local governing body is required to hold a duly advertised public hearing on the
proposed amendment prior to voting on same. Section 15.2-2302 states that "[s]ubject to any applicable
public notice or hearing requirement ... , any landowner subject to conditions proffered ... may apply to
the governing body for amendments to or variations of such proffered conditions provided only that
written notice of such application be provided in the manner prescribed by subsection B of
§ 15.2-2204."[21] An advertised public hearing is required except, "where such amendment does not affect
conditions of use or density, a local governing body may waive the requirement for a public hearing."[22]
Additionally, the governing body may waive the public hearing and the written notice requirement when
considering whether to "reduce, suspend, or eliminate outstanding cash proffer payments for residential
construction calculated on a per-dwelling-unit or per-home basis that have been agreed to, but unpaid, by
any landowner."[23]

Conclusion
For the reasons stated herein, it is my opinion that once accepted by a local governing body, cash
proffers, like all other proffers, become part of the locality's zoning ordinance and constitute a local
zoning law. Unless the local governing body approves an alternative use in accordance with
§ 15.2-2298(A) or § 15.2-2303.2, the cash proffer must be used for its original purpose, or the landowner
may seek an amendment to the proffer conditions subject to approval by the governing body. A public
hearing concerning the proposed amendment is required unless waived by the local governing body to the
extent permitted by § 15.2-2302.
With kindest regards, I am,

Very truly yours,

Mark R. Herring
Attorney General

1. 2016 Va. Acts ch. 322.

2. The term "developer" is not generally used in the Code of Virginia in relation to proffers, which are offered voluntarily by the landowner at the time of the rezoning application. A landowner may be a developer or a developer may be an authorized agent of, or successor in interest to, the original applicant. For purposes of this opinion, the term "landowner" or "applicant" will be used to denote the party authorized to apply for a conditional rezoning or a proffer amendment.

3. VA. CODE ANN. § 15.2-2296 (2018).

4. Hale v. Bd. of Zoning Appeals, 277 Va. 250, 273, 673 S.E.2d 170, 182 (2009).

5. See VA. CODE ANN. §§ 15.2-2297; -2298; -2303 (2018). Localities that derive proffer authority from § 15.2-2297 are expressly prohibited from accepting cash contributions.

6. VA. CODE ANN. §§ 15.2-2297(A); -2298(A); -2303(A).

7. VA. CODE ANN. § 15.2-2303.4(A) (2018).

8. Id. The term "new residential use" includes "any use of residentially zoned property ... that requires a proffer condition amendment to allow for new residential development." Id.

9. 2016 Va. Acts ch. 322 cl.3. This legislation expressly states that "this act is prospective only and shall not be construed to apply to any application for rezoning filed prior to July 1, 2016, or to any application for a proffer condition amendment amending a rezoning for which the application was filed prior to that date." Id.

10. Your letter references "dedicated credits" and "credits." Based on Chesterfield County's September 28, 2016 Road Cash Proffer Policy, I understand these terms to mean proffers for the dedication of real property or for the construction of in-kind improvements in lieu of all or a portion of the maximum amount of a cash proffer which may otherwise be offered to the County. COUNTY OF CHESTERFIELD, ROAD CASH PROFFER POLICY, available at https://www.chesterfield.gov/DocumentCenter/View/2396/Road-Cash-Proffer-Policy-PDF. This opinion does not address requested changes in proffers relating to the use of dedicated land or the construction of public infrastructure.

11. Hale v. Bd. of Zoning Appeals, 277 Va. 250, 274, 673 S.E.2d 170, 182 (2009).

12. VA. CODE ANN. §§ 15.2-2297(A); -2298(A); -2303(A).

13. See 2016 Va. Acts ch. 322 cl.3.

14. VA. CODE ANN. § 15.2-2298(A).

15. VA. CODE ANN. § 15.2-2303.2 (2018).

16. Id. at subsection C.

17. Id. at subsection C. The governing body must give written notice of its intent to use the cash proffer for alternative improvements to the person or entity that paid the proffer and hold a public hearing advertised in accordance with § 15.2-1427, at which the local governing body is required to make specific findings relating to the alternative use. Id.

18. VA. CODE ANN. § 15.2-2302 (2018). Note that in the event the landowner's proposed amendment is filed on or after July 1, 2016 and constitutes a "proffer condition amendment" as defined in § 15.2-2303.4(A), the 2016 Amendments will apply to the application.

19. VA. CODE ANN. § 15.2-2285(C) (2018) (emphasis added).

20. Town of Leesburg v. Long Lane Assocs. Ltd P'ship, 284 Va. 127, 137, 726 S.E.2d 27, 32 (2012).

21. VA. CODE ANN. § 15.2-2302(A).

22. Id. at subsection B.

23. Id. at subsection E.