[Massplanners] Question - Projects that change hands

[Matthew Heins]

Dear MassPlanners,

I hope you are all doing well and enjoying the holidays. I have a question about projects that change hands-that is, when a developer gets part of the way through the process and then sells the project to another developer. This sometimes happens directly after a project has been approved and is ready to begin construction, of course, but it can also happen at other stages of the process.

The question is both broad and specific. Broadly speaking, my question is: how do you folks in other towns handle this situation, from a bureaucratic and/or legal standpoint? It seems to me that when a project changes hands, it can lead to various complications because the original developer is still listed in our records as the applicant. The developers rarely bother to give my office any paperwork about this, or even a formal letter-usually someone just tells me informally that a new developer has taken over the project.

Now here's the specific question, which alas is rather convoluted but I hope you'll bear with me: About two years ago, the Pembroke planning board approved a project for a private developer/landowner to improve a small local road, which was a private road in bad condition, so that it would meet the engineering standards to be adequate for a "way." This would make it permissible for some new houses to be built on certain lots along this road, since those lots would now possess frontage on an adequate way. There is an engineering review account for this project, as required by the planning board, which is meant to cover both the initial review process and the construction inspections. After the board approved the project, the original developer/landowner sold (or somehow transferred) the whole project to another person, who is now constructing the road improvements. So that person in effect became the new developer, and presumably on some level is now the applicant. I was informed of this in a very casual manner-the new developer walked into my office and explained things. Now, here's the question. At the time the project changed hands from the original developer to the new developer, there was a balance of about $375 in the engineering review account. (The new developer has since replenished the account, in anticipation of construction inspections, so the balance is now much higher.) Shortly after the project changed hands, the original developer asked me to return that $375 to him. What should I do? It seems to me that when the project changed hands, the engineering review account became under the control of the new developer, and so the account balance now rightfully belongs to that new developer. By that reasoning, I shouldn't return the money to the original developer. What do you think? Obviously the amount of money is trivial, but it's the principle that matters and I do need to decide. I may check with our town counsel eventually, but I'm curious to get your advice. I imagine some of you have confronted similar situations. What do you suggest?

Thanks for your assistance! (And best wishes for 2022!)

Sincerely,

Matthew Heins
Planning Board Assistant
Town of Pembroke
Email: mheins at townofpembrokemass.org<mailto:mheins at townofpembrokemass.org>
Phone: 781-709-1433 / Fax: 781-709-1453
Address: Office of the Planning Board, Pembroke Town Hall, 100 Center St., Pembroke, MA 02359

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