CITY HALL — City Council members voted to extend an interim ordinance that expands City Hall’s ability to oversee development projects in Downtown that are taller than 32 feet, but not without some alarm from at least one developer who threatened to sue if the approvals on existing projects changed.

The ordinance requires most projects 32 feet and above to go through the development agreement process rather than proceed under administrative review, which requires no public input.

It was originally put in place for 60 days in January, and will now be in effect until October 2012 as city staff updates the zoning code to conform with the 2010 Land Use and Circulation Element, or LUCE.

Development agreements give city staff the latitude to request public benefits that they couldn’t get under normal permit rules. They are also a commonly used method of circumventing zoning codes.

The ordinance also applies to projects that are already underway, although the council made it easier for two that have gone through some process by not requiring them to go through the full development agreement process.

There are 700,000 square feet of projects in the pipeline that would be affected by the interim ordinance.

Rather than allow those development projects to move forward as though the ordinance didn’t exist, guaranteeing developments that do not meet the stricter LUCE standards, the ordinance forces the two Downtown developments and four other projects to adhere to most LUCE principals.

“In this community, residents are expecting that we are applying the criteria and direction of the LUCE, and it would not be appropriate to have projects coming online that did not reflect those expectations,” said Planning Director Eileen Fogarty at the City Council meeting.

Several members of the community addressed the council in support of the ordinance.

“The interim standards are needed so that LUCE guidelines are followed,” said Zina Josephs of Friends of Sunset Park. “Development might not otherwise conform to the LUCE vision unless it’s in development agreements.”

Not all were pleased.

The developer in charge of the two Downtown projects in the pipeline cried foul at the additional burden, and threatened prior to the meeting to sue City Hall not only to prevent the ordinance from being applied to those projects, but to overturn the ordinance in its entirety.

“They told me they were going to challenge both the applications of the interim zoning ordinance and more broadly with the goal of invalidating it,” said City Attorney Marsha Moutrie.

Development agreements tend to draw out the building process, which can be expensive to developers. The administrative review, where planners compare project specifications to a list of requirements in-house, involves no public process and is relatively predictable.

At the council meeting, Moutrie announced in open session that the lawyers for the firm Harding Larmore Mullen Kakle Kutcher & Kozal, which represents the developer of the two Downtown projects, had submitted a settlement agreement in addition to threats of litigation.

Under the terms of the settlement, the developer would voluntarily enter development agreement negotiations with City Hall, with the condition that those talks would take between 90 and 150 days at the most.

If talks fell apart, the developer would be allowed to continue with the project under an administrative approval.

In the development agreement, the developer is expected to ask that City Hall reduce the number of parking spaces required, Moutrie said, which is expected to make the projects less expensive to build.

Council members voted to accept the settlement agreement before the public hearing on the interim ordinance was held.

They were assured by Moutrie that the vote in no way “tied their hands” on the zoning vote as the settlement was conditional on the ordinance passing.

Both the settlement agreement and the interim zoning ordinance passed unanimously.

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