Responding to Public Record Requests for Building Permit Documents
Many of you have recently received a request to provide copies of building permits issued in the past, names and addresses of building permit applicants, and also copies of building permits as they are issued in the future. We received several questions whether the document request is proper.
We are sending you this update to clarify your public record responsibilities regarding building permits under the Pennsylvania Right-To-Know Law, 65 P.S. §§67.101 et seq. (“RTKL”), and the Pennsylvania Uniform Construction Code (“UCC”) regulations codified at 34 Pa. Code §403.85(e).
What Are Your Rights to Municipal Public Records?
A record is not a public record subject to disclosure if it is exempt from being disclosed under any Federal or State law, or regulation, or judicial order or decree. The UCC Regulations state in §403.85(e) that “a municipality and a third party agency acting on behalf of a municipality may prohibit the release of applications received, building plans and specifications, inspection reports and similar documents to the public under the … Right-To-Know Law.”
The Township is required to provide copies of approved building permits. The Pennsylvania Office of Open Records (hereafter, “OOR”) has held that approved building permits are items issued by the Township, and therefore they don’t receive the same exclusionary protection that “applications” and “building plans and specifications” receive because the latter are documents submitted to the Township by third parties. See In the Matter of Pohlman v. Middle Smithfield Township, OOR AP 2011-0660.
Furthermore, the OOR has previously held that building permits are not facially exempt under the RTKL. See Pleasantville Water Auth. v. West St. Clair Twp., OOR Dkt. AP 2010-0465.
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Limitations on Requirements for Municipal Public Records Requests
Municipalities do not, however, have to produce building permit applications or names and addresses from applications. Under the UCC, a municipality may prohibit the release of “applications received, building plans, and specifications, inspection reports, and similar documents.” See 34 Pa. Code § 403.85(e). Therefore, under the UCC, a Township may exercise its discretion and refuse to release building permit applications or names and addresses from applications pursuant to the RTKL.
Municipalities, likewise, do not have to compile lists of the names and addresses of people with permits. An agency is not required to modify its practices by compiling lists of information when such lists are not otherwise kept by the agency or required by law, and an agency is not required to modify its duties to become the agent of a commercial enterprise. Current Status, Inc. v. Hykel, 778 A.2d 781 (Pa. Cmwlth. Ct. 2001).
Furthermore, the RTKL only requires agencies to make records available for inspection; it is up to the requester to conduct searches or compile lists from those records. Lewis, III v. Pennsylvania Dept. of Transp., 777 A.2d 538 (Pa. Cmwlth Ct. 2001).
Municipalities, likewise, do not have to produce future building permits as they are issued. Future permits do not currently exist. The RTKL does not require agencies to compile and distribute information they do not possess at the time of the request. Dynamic Student Services v. State System of Higher Educ., 697 A.2d 239. If the requester wants access to future monthly permit records, the requester will have to submit monthly requests for the permits that have already been issued.
Please contact us or call 717-845-1524 if you have more specific questions about responding to these record requests.
Private street improvement may constitute land development
In Ruckert v. Wayne Township et al., Civil No. 10468 of 2012 (Slip Op. Jan. 23, 2013), the Lawrence County, Pennsylvania Court of Common Pleas recently ruled on issues related to a homeowner’s private undertaking to construct an unopened road using gravel, stones and bricks. The Court, in ruling on preliminary objections, found that the construction constituted land development under both the Wayne Townships’ (the “Township”) Subdivision and Land Development Ordinance (“SALDO”) and the Municipalities Planning Code (“MPC”) and that a private cause of action exists for an aggrieved landowner to require the Township to enforce its SALDO.
The Defendant homeowners were attempting to develop roadways shown on the subdivision plan, but never opened, without first submitting land development plans, obtaining Township approval, or posting security under the SALDO. The development of streets by the Defendants included a section of an undeveloped shared private road and a section of unopened public street that the Township did not maintain or use. The Defendants accessed their property via the undeveloped and unopened roads. The “street construction” included clearing of trees and brush and the laying of bricks, stone, and gravel to the unopened parts of the streets to create a road to their property. Plaintiffs claimed Defendants’ actions in constructing the road created deep, unfinished ruts in the road directly fronting Plaintiff’s property, thereby creating safety concerns for cars and pedestrians as well as diminishing the property value.
The Court found that the Defendants actions in constructing the road fell within the Township’s definition of land development in its SALDO, which is substantially identical to the MPC’s definition of land development. Additionally, the Court found §617 of the MPC provided a private cause of action for an aggrieved landowner for violation of any ordinance enacted under the MPC. The Court rejected the Township’s argument that § 617 only applies to issues related to a zoning ordinance by finding § 617 expressly states “any Ordinance enacted under this Act.” Therefore, the Court found that Plaintiffs had a private cause of action in equity requiring the Township to enforce its SALDO against the Defendants.
This case reinforces the jurisdiction of a municipality over any development that has a nexus to the general public interest, whether by streets, curbs, sidewalks, stormwater management, emergency services, or public water and sewer. The case also highlights the risk to a municipality of being joined in litigation for not exercising regulatory authority where it exists.
Please call us if you have more specific questions. If you would like to be added to this distribution list, please email Ctutino@mpl-law.com.
New Sign Retroreflectivity Requirements
The Federal Highway Administration (“FHWA”) recently adopted new regulations aimed at implementing and enforcing retroreflectivity standards of traffic control signs. “Retroreflectivity” describes how light is reflected from a surface and returned to its original source. Because the retro-reflective components in signs have a limited life, the new regulations seek to prevent noncompliant traffic control signs. All agencies that own and maintain traffic signs are required to adhere to the new requirements for their traffic control signs. The new FHWA standards, which are contained in the manual on Uniform Traffic Control Devices (“MUTCD”), establish minimum levels of sign retroreflectivity.
By June 13, 2014, all agencies which own and maintain traffic control signs must establish and implement a written traffic sign management or assessment plan that is designed to maintain regulatory and warning sign retroreflectivity at or above the established minimum levels. Generally, the assessment or management plan must catalog all retroreflective traffic signs owned and maintained by an agency, note their location, note their current retroreflective levels, and put in place a systematic method of replacing noncompliant traffic control signs. Although a system or schedule for replacement must be in place, FHWA generally states the replacement should occur as resources become available. However, a schedule requiring replacement “as needed” will be considered unacceptable to the FHWA.
This compliance date does not require replacement by a particular date; rather it only requires agencies to implement an assessment or management plan for maintaining and evaluating applicable standards of sign retroreflectivity. Additionally, although the compliance date relates only to regulatory and warning traffic signs, the FHWA has stated that it still expects agencies to establish a method for assessing and maintaining retroreflectivity standards for all types of signs as required by the regulations. This means that non-traffic control signs, such as guide signs, still are required to be included in an agency’s assessment and management plan; however, they may subsequently be added as resources allow rather than by the compliance date.
In addition to improving safety for drivers, the implementation of a reasonable plan for maintaining sign retroreflectivity will serve to defend public agencies in the event of tort liability claims and litigation surrounding sign retroreflectivity. Public agencies that demonstrate a reasonable maintenance plan as outlined in the MUTCD should be better equipped to successfully defend against tort litigation involving claims of improper sign retroreflectivity, as the FHWA standards will likely be adopted by courts as the required standard in litigation surrounding retroreflectivity of traffic control signs. The public agency will need to be prepared to defend its replacement scheduling decisions where liability issues arise.
Due to the technical nature of this evolving field, additional research is required to ensure each municipality takes the requisite steps to comply with the retroreflectivity standards and new implementation requirements. Below is a list of resources to further review compliance measures. Additionally, some businesses have begun to work with municipal retroreflectivity compliance. Please call us for such contacts or if you have more specific questions. If you would like to be added to this distribution list, please email Ctutino@mpl-law.com.
|Sign Retroreflectivity Toolkit||http://safety.fhwa.dot.gov/roadway_dept/night_visib/retrotoolkit/index.htm|
|Sign Retroreflectivity Guidebook||http://www.ttap.mtu.edu/wisafety09/eng/eng3/Rauch_WisDOT_Sign_Retroreflectivity.pdf|
|Nighttime Visibility Retroreflectivity||http://safety.fhwa.dot.gov/roadway_dept/night_visib/|
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LLC or corporation: Which is right for you?
Fifteen years ago, most business entities formed for liability protection were corporations. Most small, closely held corporations would elect s-corporation status to avoid the double taxation of a c-corporation and be taxed as a pass-through entity. However, s-corporation tax status has pitfalls. An s-corporation may only have one class of stock and may only have individuals that are U.S. citizens as investors. An s-corporation must also allocate profits and losses in strict accordance with its share ownership. S-corporation tax status can therefore be restrictive when raising capital or attracting investors. S-corporations are especially restrictive where investors demand preferred economic rights (such as preferred stock) or convertible debt, stock options or warrants.
Today, most small businesses entities that are formed for liability protection are limited liability companies (LLCs). A small, closely held limited liability company has the same liability protection as a corporation, but has more options for tax treatment. A limited liability corporation may be taxed as c-corporation or an s-corporation or a partnership. Many times, partnership tax treatment is a very advantageous form of tax treatment because it offers maximum flexibility to the business. A partnership does not have restrictions on its owners so members of an LLC taxed as a partnership may be business entities or non-U.S. citizens. A partnership may also allocate profits and losses with much more flexibility than a corporation through special allocation provisions. Special allocation provisions are allowed in partnerships because there is not a restriction on classes of stock.
A limited liability company taxed as a partnership is especially beneficial for businesses that need to attract foreign investors as equity owners or for two corporations or other business entities to engage in a joint venture without directly incurring the liabilities of the joint venture. A limited liability company taxed as a partnership is also advantageous for start-ups that need to attract angel or venture capital investments that may require a class of preferred membership with preferential economic rights, convertible debt or the issuance of options or warrants.
For more information about the differences between corporations and LLCs, please contact Andrew Miller, at MPL Law Firm, firstname.lastname@example.org.
Member-Managed or Manager-Managed Limited Liability Company (LLC): What’s the Difference?
Limited liability companies are intended to provide liability protection to owners (known as members) while at the same time giving the members maximum flexibility in corporate governance. One of the choices an LLC must make when organized is whether to be “manager-managed” or “member-managed”.
Member-Managed vs. Manager-Managed LLC: Structure and Responsibilities
A manager-managed LLC delegates management responsibility to one or more “managers” who will have fiduciary duties to the members of the LLC. The LLC may be structured like a limited partnership in which one or more managers exercise all management control and make all day-to-day operational decisions of the LLC. The members would be similar to limited partners with very limited or restricted say in the affairs of the LLC.
Alternatively, the LLC may be structured like a corporation where managers serve in a capacity similar to a board of directors (the managers may even compose a “board of managers”) that provides oversight and governance of the LLC, but delegates day-to-day operations to officers such as a president and one or more vice-presidents. The members elect the board of managers and typically retain authority to vote on fundamental transactions of the LLC.
A member-managed LLC retains all management responsibility among the members who function like general partners in a general partnership. Each member has a fiduciary duty to the other members. The operating agreement must carefully set forth restrictions on the authority of a member to bind the LLC or otherwise take action on behalf of the LLC without approval by member vote. For example, in a true general partnership, each general partner may bind the partnership by its actions. In most member-managed LLCs a member may only bind the LLC within certain limits with all other decisions requiring approval by a majority or supermajority of the members.
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Is a Member-Managed or Manager-Managed LLC Right for Your Business Formation?
A member-managed LLC is useful for joint ventures or small, closely held LLCs with only a few members that do not intend to grow or expand through the addition of new members. The member-managed LLC structure allows more efficient and easier day-to-day operation of the LLC.
On the other hand, a Manager-managed LLC is more useful for an LLC that may want to delegate all responsibilities to one person or a small core of persons who do not need to seek approval from the members for major decisions. A manager-managed LLC is also useful for LLCs that intend to undertake capital raises from sophisticated investors who will not want to run the LLC but will demand seats on a board of managers in order to closely monitor their investment and provide guidance to grow their investment.
For more information on the operational structure of LLCs, please contact Andrew Miller, at (717) 845-1524 or email@example.com.
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Pennsylvania Benefit Corporations
What Are Benefit Corporations?
On October 24, 2012, Pennsylvania became the twelfth state to amend its business corporation law to provide for a new type of corporation known as the “benefit corporation”.
Benefit corporations are intended to be for-profit corporations with a social conscience. In addition to the intended purpose of providing profit to shareholders, benefit corporations include provisions within their articles of incorporation that require the corporation to have a purpose that positively benefits society.
Perks of Becoming a PA Benefit Corporation
Social investing and social responsibility are major trends in the financial and business world. Many investors and consumers want to invest in or buy from companies that have a moral compass. The benefit corporation law is intended to create standards for social responsibility that investors and consumers can use to make decisions about the moral and social propriety of the companies they invest in.
An election to be a benefit corporation may allow you to:
- Raise capital from socially responsible investors.
- Attract socially conscious consumers.
- Associate the identity of your business with a particular cause.
Pennsylvania Benefit Corporation Requirements
Social Conscience Requirements
The Pennsylvania statute assures benefit corporations will maintain a social conscience in several ways:
- A benefit corporation must have a corporate purpose to create a material, positive impact on society and the environment in addition to the obligation to make a profit.
- The officers and directors of the benefit corporation have a newly-created fiduciary duty to consider nonfinancial interests.
- A benefit corporation must file an annual statement available to the public used to assess its overall social and environmental performance against independent third-party standards.
Public Benefit Requirements
A benefit corporation may elect to have a general public benefit or a specific public benefit. Specific public benefits must be set forth in the articles of incorporation. The specific public benefits listed in the statute include:
- Providing low-income or underserved individuals or communities with beneficial products or services
- Promoting economic opportunity for individuals or communities beyond the creation of jobs in the normal course of business
- Preserving the environment
- Improving human health
- Promoting the arts, sciences or advancement of knowledge
- Promoting economic development through support of initiatives that increase access to capital for emerging and growing technology enterprises, facilitate the transfer and commercial adoption of new technologies, provide technical and business support to emerging and growing technology enterprises or form support partnerships that support those objectives
- Increasing the flow of capital to entities with a public benefit purpose
- Conferring any other particular benefit on society or the environment
How to Become a Benefit Corporation in Pennsylvania
For new PA businesses, the process of forming a benefit corporation does not differ much from the process of forming a traditional corporation. A new business may elect to be a benefit corporation at the time of its initial filing of articles of incorporation.
Existing Pennsylvania corporations seeking to become benefit corporations can do so following either of these circumstances:
- Amendment of the corporation’s existing articles of incorporation. This amendment must be approved by at a two-thirds majority of the corporation’s shareholders.
- Completion of a fundamental transaction such as merger, division, consolidation or share exchange.
It is important to understand that the election to be a benefit corporation does not change the federal or state tax status of a corporation, so if a business is a C-corporation or an S-corporation, it will maintain that status.
Choose MPL Law Firm for Your PA Benefit Corporation Needs
If you want your business model to include consideration of general or specific public benefits, a benefit corporation may be a good choice for your corporate structure. To explore the aspects of a public benefit corporation, please contact Andrew Miller, at MPL Law Firm, firstname.lastname@example.org for more information.