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Advocacy Angle: Not existing on a figurative island 

by League Director of Public Affairs Scott Mooneyham

Several years ago, then state Senate leader Marc Basnight commented on how, in his home county of Dare, big beachfront homes amounted to the high-tech manufacturing facilities and office buildings of the urban areas of the state. It was keen observation. Those million dollar homes are a huge part of the property tax base for coastal communities. Just like the property tax dollars generated by an office tower in Charlotte or software facility in Raleigh, the tax revenue generated by those beachfront homes is critical when it comes to providing the services that permanent and temporary residents depend upon.

Basnight’s comments came to mind recently as some state regulators attempted to wrestle with a regulatory challenge posed by large beachfront homes. Specifically, when do they go from being residential structures to commercial facilities, and when should they be regulated as such? The North Carolina Building Code Council dealt with the question during a public hearing called in response to some specific mega-resort homes that look and feel more like hotels, with large meeting spaces and even detached living areas.

Large beachfront homes in which the owners defray their costs by renting to vacationers are nothing new. But what happens when those homes become so large that they attract big groups of unrelated people who require safety features like wide halls, emergency exits, reinforced balconies and sprinkler systems to keep them safe? Those concerns are not theoretical. In recent years, vacationers have been injured when outdoor decks have collapsed.

League staff, city officials and building inspectors made that case for the need to address safety considerations during a Building Code Council public hearing. It is not clear how the council will proceed and whether it will take up code revisions.

The members understand that the General Assembly has taken a dim view of how some local governments have attempted to sort out of this kind of thing, using the number of bedrooms or kitchens to determine purpose or apply restrictions. In some ways, the current dilemma before the Building Code Council renews the debate over residential design standards that played out before legislators last year, with a majority ultimately backing homebuilders who wanted restrictions on design standards imposed by some municipalities and rejecting a League compromise.

The supporters of the homebuilders’ proposal cited property rights in making their decision. But as the issue before the Building Code Council shows, property rights are not simple. In this case, those rights have to be weighed against the duties and responsibilities of government to protect public safety. Here, it is about the safety of renters who enter into agreements to rent these facilities with an expectation that they will be safe using them for the purposes for which they are marketed.

Also to be considered are the property rights of surrounding property owners who, when it is beachfront property, may have invested a million or more dollars. They likely did so with the expectation that a facility hosting weddings or big events will not slip through a regulatory loophole and pop up next door, potentially de-valuing their property.

All of this is to say that state policymakers need constant reminding that land use does not exist in a parcel-by-parcel vacuum. Like so much of public policy, the one thing over here can affect the other thing over there, even if it wasn’t intended to happen that way.