If you are a small business owner considering opening in a new location, or making renovations at an existing location, it is extremely important that you understand state and local use and occupancy laws and requirements. For the reasons described below, you should not rely on the local municipality to explain these requirements.
A (TRUE) HORROR STORY
The operator of a small child care center decided she would like to move her business to a neighboring borough for the start of the new school year. She found a suitable commercial space available for lease. She visited the township building in February, and was advised that borough ordinances required that she submit a Conditional Use application and get approval before she could operate. She completed and filed the Conditional Use application on her own and attended three Conditional Use hearings before the Borough Council. In June, after the third hearing, the Borough Council granted her Conditional Use application and gave her approval to operate her business. In reliance on that decision, business owner signed a lease for the commercial space and began making some minor repairs and decorating the property.
In July, the borough’s Building Code Official (BCO) came to the property and told business owner that she was present in the property illegally because she did not have a Use and Occupancy permit. The BCO also provided her with a list of improvements that would be needed to obtain a Use and Occupancy permit, including widening a bathroom doorway, installing an accessible toilet, sink, and grab bar in the bathroom, raising the level of the bathroom floor, installing GFI outlets, relocating a bathroom light switch, installing illuminated exit signs, and installing an accessible ramp at the entrance to the property. With less than two months before her planned opening, business owner immediately began making these improvements. She spent $17,779.00 on the interior improvements, and then learned after meeting with an architect that the exterior accessibility ramp was estimated to cost an additional $25,000. At this point, she retained our firm to assist her. She explained that she had already spent much more money than she could afford on the interior improvements, and that the cost of installing the accessibility ramp would put her out of business. In addition to the money she spent, her difficulties with the borough had also cost her a great deal of time, energy, and stress.
USE AND OCCUPANCY LAWS ARE HARD TO FIND, AND HARDER TO UNDERSTAND
For the reasons I am about to explain, it is extremely difficult to understand use and occupancy laws and codes unless you have an engineering degree, a law degree, and a remarkable amount of time and patience.
First, the borough’s “code” typically isn’t an actual building code with written requirements that a business owner can review and understand. In our case, all the borough code says is that the borough adopts as its Building Code the BOCA National Building Code/1996, Thirteenth Edition, as published by the Building Officials and Code Administrators International, Inc. The borough code also says that the borough adopts the Uniform Construction Code and elects to enforce the Pennsylvania Construction Code Act.
Second, try finding the BOCA National Building Code online. You will discover that it is quite difficult to find a free copy of that code. But you won’t have any trouble buying it on Amazon.com (used paperback copy for $82.95, new copy for $2,498.00). So now you have to PAY to learn what laws your municipality wants you to follow?!?!
Third, even if you find a free copy of the BOCA National Building Code/1996, Thirteenth Edition, and understand it, your work would not be over. Since the borough also adopted the Uniform Construction Code, you will need a copy of that as well. Luckily that is a Pennsylvania statute, and is available for free online. But your work STILL isn’t over, because after you read and try to understand the Uniform Construction Code, you will notice that it adopts and incorporates provisions of the International Building Code and the International Existing Building Code! So now you have two more codes to find, read, and try to understand. If you are resourceful enough to find free copies of these codes, you will discover that they are each several hundred pages long, and also difficult to understand without both an engineering and law degree. But your work STILL isn’t over, because both of these codes reference other codes: the International Fire Code, International Fuel Gas Code, International Mechanical Code, International Plumbing Code, International Property Maintenance Code, International Private Sewage Disposal Code, International Residential Code, and the National Fire Protection Association standards.
MOST BUILDING CODE OFFICIALS MAKE MORE MONEY WHEN THEY MAKE YOUR LIFE MORE DIFFICULT
In many Pennsylvania municipalities (probably most), the Building Code Official is not a salaried employee of the municipality. Instead, they are paid on an hourly or per inspection basis. If the BCO finds violations during an initial inspection, the property owner or business operator will be required to make improvements or repairs, which will require the BCO to perform additional inspections of those improvements or repairs, which will result in the BCO making more money for performing those additional inspections. The result of this typical payment structure is that Building Code Officials generally have a financial incentive to “find” violations during an initial inspection and require repairs or improvements.
A HAPPY ENDING?
It turns out that even the borough’s Building Code Official couldn’t understand the borough’s use and occupancy code! Our office prepared and filed an Appeal and Request for Variance with the Pennsylvania Department of Labor and Industry’s Accessibility Advisory Board, challenging the decision of the BCO that an exterior accessibility ramp was legally required. We also obtained a temporary Use and Occupancy Permit for our client so that she could operate her business while our appeal was pending. The Accessibility Advisory Board overruled the BCO and determined that our client was not required to build the exterior accessibility ramp, because:
“On December 31, 2015, the Commonwealth adopted the 2015 edition of the International Existing Building Code (IEBC) for existing buildings. With the proposed work constituting a partial change in occupancy, IEBC §1012.8.1 would apply, which in turn refers back to IEBC § 705. IEBC § 705.2, deals with alterations affecting an area containing a primary function. It mandates the provision of furnishing an accessible route, however, limits the expenditure of said route to 20% of the alteration costs. The petition narrative also indicated that a contractor gave an estimate in excess of $25,000 for a ramp to provide an accessible route, which far exceeds the 20% mandated by the Code.”
Our client was happy that we won, but was she really happy? Of course not! She had already spent $17,779.00 on interior improvements she wasn’t prepared to pay for, along with several months of time, energy and stress.
MORAL OF THE STORY
Even a simple change in occupancy in part of a commercial property can require a use and occupancy inspection, and may require very expensive improvements to the property. Most small business owners will not have the time or the ability to accurately determine whether they will be subject to inspection, whether improvements will be necessary, and the scope and cost of necessary improvements. Before you consider opening or moving your business, and before you sign a lease or make any improvements or alterations, it is generally a very worthwhile investment to get legal advice on your local municipality’s use and occupancy laws and other legal requirements.
If you or someone you know needs advice regarding municipal use and occupancy laws, contact Damien D. Brewster, Esq. at Keenan, Ciccitto & Associates, LLP.