Rights in real property - Rezoning and other zoning changes

Learning Outcomes

This article explains how rezoning and other zoning changes affect real property rights for MBE purposes, including:

• Identifying types of zoning actions (map rezoning, text amendments, upzoning, downzoning, spot zoning) and predicting how each alters permitted uses, density, and development standards.
• Distinguishing nonconforming uses from nonconforming structures, determining when each is protected, and applying rules on continuation, expansion, repair, destruction, abandonment, and amortization periods.
• Recognizing when a landowner has acquired vested rights through valid permits and substantial good‑faith reliance, and contrasting that with mere expectations, applications, or planning that do not survive a zoning change.
• Evaluating the constitutional limits on rezoning under substantive due process, equal protection, and the Takings Clause, including regulatory takings and invalid spot zoning.
• Analyzing exam fact patterns involving rezonings, variances, and special or conditional use permits, and choosing the best answer by focusing on timing, status of the use or structure, and the government’s stated objectives.
• Using structured checklists to work through typical MBE questions involving zoning amendments, ensuring you reliably spot protected interests, vulnerable uses, and potential constitutional challenges.

MBE Syllabus

For the MBE, you are required to understand zoning as part of rights in real property, with a focus on the following syllabus points:

• Basic zoning concepts and the local police power
• Protection of pre-existing property rights when zoning changes
• Creation and regulation of nonconforming uses and structures
• Rezoning and other zoning changes, including spot zoning
• Interaction between zoning changes and constitutional limits (especially takings)

Test Your Knowledge

Attempt these questions before reading this article. If you find some difficult or cannot remember the answers, remember to look more closely at that area during your revision.

1. A city rezones a district from commercial to residential. Which of the following best describes the status of a business that lawfully operated before the rezoning?
   1. The business must immediately cease operations.
   2. The business may continue as a nonconforming use, subject to reasonable regulation.
   3. The business is entitled to compensation for loss of value.
   4. The business may expand without restriction.
2. Which of the following is most likely to create a vested right protecting a property owner from a new zoning restriction?
   1. Obtaining a building permit and making substantial construction progress.
   2. Merely applying for a building permit.
   3. Advertising the intended use.
   4. Submitting a zoning variance request.
3. A city amends its zoning ordinance to prohibit all apartment buildings in a neighborhood. Which constitutional provision is most likely to be implicated if the city orders demolition of existing apartments without compensation?
   1. Equal Protection Clause
   2. Takings Clause
   3. Privileges and Immunities Clause
   4. Dormant Commerce Clause

Introduction

Zoning is one of the main tools local governments use to regulate land use under their police power. City and county zoning ordinances divide land into districts (residential, commercial, industrial, etc.) and specify the allowed uses, density, height, and other development standards.

These ordinances are not static. Legislatures routinely amend zoning maps and zoning text to respond to changing community needs. Those changes can sharply affect existing owners—especially those who already use or have concrete plans to use their land in ways no longer permitted.

On the MBE, questions about rezoning and zoning changes usually test three clusters of rules:

• What happens to existing uses and structures (nonconforming uses)
• When an owner has vested rights that survive a zoning change
• When a zoning change (or its enforcement) crosses a constitutional line

Understanding how these pieces fit together is essential to spotting which owners are protected and which are not.

Key Term: Rezoning
Rezoning is a legislative change to the zoning map that alters the zoning classification of a parcel or area (for example, from “C-2 commercial” to “R-1 single-family residential”), changing the uses and standards permitted on that land.

Key Term: Text Amendment
A text amendment is a legislative change to the wording of the zoning ordinance itself (for example, tightening height limits, increasing setbacks, or changing the definition of “family”).

Rezoning and text amendments can both create conflicts with existing and planned uses. The doctrines below explain how the law resolves those conflicts.

Types of Zoning Changes

Zoning changes on the MBE typically appear in three forms:

• District-wide rezoning: The city reclassifies an area (e.g., all parcels along a corridor change from industrial to mixed-use residential).

• Parcel-specific rezoning: A single parcel or a very small area is reclassified, sometimes raising “spot zoning” problems.

• Text amendments: The city changes the ordinance’s substantive rules: height limits, minimum lot size, parking requirements, density caps, or use lists in each district.

You may also see “upzoning” (making regulations more permissive) and “downzoning” (making them more restrictive, often limiting intensity or permitted uses).

Key Term: Downzoning
Downzoning is a zoning change that makes regulations more restrictive for a property (for example, lowering density or eliminating commercial uses that were previously permitted).

Nonconforming Uses

When a zoning change prohibits a use or structure that was lawful under prior zoning, the use or structure becomes a nonconforming use (sometimes called a “legally nonconforming” or “grandfathered” use).

Key Term: Nonconforming Use
A nonconforming use is a use or structure that complied with all zoning requirements when established, but no longer conforms to the zoning ordinance after a subsequent change.

Key points:

• The use must have been lawful when established.
  • An illegal use does not become protected simply because it predates a new ordinance.
• The protection attaches to the use, not the identity of the owner. Nonconforming status generally runs with the land.

Treatment of Nonconforming Uses

Most jurisdictions strike a balance between fairness to owners and the public interest in enforcing current zoning:

• Continuation:
  A lawful nonconforming use may usually continue despite the new zoning. Owners are not forced to stop using their property overnight.

• No automatic right to expand:
  The owner generally may not enlarge, intensify, or extend the nonconforming use beyond what existed at the time of the zoning change, unless the ordinance expressly allows it.

• Repairs and normal maintenance:
  Reasonable repairs and ordinary maintenance to keep the use safe and functional are usually allowed. But major alterations that effectively increase the nonconformity are typically barred.

• Change to a less intense use:
  Many jurisdictions allow an owner to change a nonconforming use to another use that is more compatible or less intensive (for example, from a nightclub to an office), but once changed, the owner may not revert to the original, more intense nonconforming use.

• Destruction or Abandonment:

  • If the structure is destroyed (often beyond a certain percentage of its value), or
  • If the use is voluntarily discontinued for a specified period,
    the nonconforming status is usually lost. The owner may then resume only a conforming use.

Key Term: Amortization
Amortization is a technique by which a zoning ordinance requires a nonconforming use to cease after a reasonable period, designed to allow the owner to recoup the investment in the use before termination.

Amortization provisions are common for nonconforming billboards, junkyards, or adult uses. Courts usually uphold them if the phase-out period is reasonable in light of the investment and the character of the use. A very short period that effectively wipes out substantial investment can be vulnerable as a due process or takings problem.

Worked Example 1.1

A city rezones a district from commercial to residential. A bakery has operated lawfully in the district for 20 years. After rezoning, the city notifies the bakery that it must close within 6 months. The bakery challenges the order.

Answer:
The bakery is a lawful nonconforming use. The city may keep the bakery from expanding and may require eventual termination through amortization, but the amortization period must be reasonable in light of the owner’s investment and ability to relocate. A flat requirement to close in six months is suspect if the bakery has substantial sunk costs and cannot realistically recoup them in that time. On MBE facts, that kind of short phase-out is likely invalid.

Nonconforming Structures

Some questions involve nonconforming structures rather than uses—for example, a house that violates new height or setback rules.

The basic pattern is similar:

• Routine repairs are allowed;
• Structural alterations that increase the nonconformity (e.g., adding a taller story to an already too-tall building) are usually barred;
• If the structure is destroyed beyond a specified threshold, rebuilding to the same nonconforming dimensions may be prohibited.

Worked Example 1.2

A house lawfully built one foot into the side setback becomes nonconforming when the city increases side setbacks. A fire later destroys 80% of the house. The owner applies to rebuild on the same footprint. The ordinance states that if a nonconforming structure is destroyed by more than 50%, any reconstruction must comply with current zoning. How should this be resolved?

Answer:
The ordinance validly limits the continuation of nonconforming structures. Because the house was destroyed beyond the threshold set by the ordinance, the owner has no right to rebuild on the nonconforming footprint and must comply with the current setback. There is no vested right in maintaining a nonconforming structure after the conditions in the ordinance for loss of that status are met.

Vested Rights

Sometimes an owner has not yet completed a project when the zoning changes. Whether that owner can proceed under the old rules turns on vested rights.

Key Term: Vested Right
A vested right is a legally protected right to complete a use or development under the regulations in effect at a particular time, even if the zoning later changes, typically arising from substantial good‑faith reliance on a validly issued permit.

Common exam rules:

• Permit + substantial reliance:
  A vested right usually requires:

  • A valid building permit (or equivalent approval), and
  • Substantial work or expenditures in good faith reliance on that permit.

• Mere application or planning is not enough:
  Hiring an architect, preparing plans, or filing a permit application—without more—does not vest rights.

• Permit must be valid:
  If the original permit was void (for example, issued in violation of clear ordinance requirements), many courts refuse to recognize vested rights, though some recognize a limited “zoning estoppel” theory where the owner reasonably relied on the government’s mistake.

Key Term: Zoning Estoppel
Zoning estoppel is an equitable doctrine under which a government may be barred from enforcing a new zoning restriction against an owner who reasonably and substantially relied on earlier governmental approvals, even if the approval was technically erroneous.

Worked Example 1.3

A developer obtains a building permit for a 10‑unit apartment building. Before construction begins, the city rezones the property to single‑family residential. The developer has not yet spent significant funds. Can the developer proceed?

Answer:
No. A vested right generally arises only after substantial construction or expenditures in good‑faith reliance on a valid permit. Here, the developer has a permit but no substantial reliance. The new zoning applies, and the city may prevent construction of the apartment building.

Worked Example 1.4

Assume instead that, after receiving a valid permit, the developer spends $400,000 on excavation, foundations, and materials. Then the city rezones to single‑family residential and revokes the permit. The city has long known of the developer’s work and even inspected the site. May the city now stop the project?

Answer:
On these facts, the developer is likely to have a vested right (and possibly a zoning‑estoppel argument) to complete the project under the prior zoning. The combination of a valid permit, substantial expenditures, and good‑faith reliance—especially with city inspections—strongly supports vesting. The later rezoning cannot lawfully be applied to halt the project.

Constitutional Limits on Rezoning

Rezoning and text amendments are exercises of the police power and are generally valid if they are rationally related to a legitimate public purpose. But they are subject to constitutional constraints.

Key Term: Spot Zoning
Spot zoning is a rezoning that singles out a small parcel (or a few parcels) for treatment different from surrounding property, in a way that is inconsistent with the comprehensive plan and not justified by a legitimate public purpose.

Substantive Due Process

Zoning, including rezoning, must meet substantive due process standards:

• It must be rationally related to a legitimate public purpose (health, safety, morals, or general welfare).
• Rezoning is presumed valid; a challenger must show it is arbitrary or capricious.

Spot zoning is often attacked under substantive due process:

• If a small parcel is rezoned solely to benefit a particular owner, with no plausible public purpose and in conflict with the comprehensive plan, a court can invalidate the rezoning as arbitrary.
• But if the city can articulate a reasonable planning rationale (transition between districts, buffering, traffic management, etc.), the rezoning usually survives rational‑basis review.

Equal Protection

Equal protection challenges can arise when similarly situated owners are treated differently:

• If the classification does not involve a suspect or quasi‑suspect class, the test is again rational basis.
• For example, an owner might argue that her parcel was downzoned when nearby parcels were not, with no rational reason. Such claims rarely succeed unless the facts show blatant, unexplained discrimination.

Procedural Due Process

Because rezoning is typically a legislative act, affected owners generally are not entitled to individualized notice and a trial‑type hearing as a matter of constitutional law, although state statutes often require public hearings.

By contrast:

• Decisions on variances or special use permits (conditional use permits) are more administrative or quasi‑judicial and may trigger stronger procedural protections.

Key Term: Variance
A variance is an administrative authorization to deviate from the strict terms of the zoning ordinance (for example, a smaller setback or a different use) when applying the ordinance literally would cause unnecessary hardship and the deviation is consistent with public welfare.

Key Term: Special Use Permit
A special use permit (or conditional use permit) is approval to operate a use that the zoning ordinance allows only on a case‑by‑case basis, subject to specific conditions designed to mitigate its impacts.

On the MBE, be careful to distinguish:

• Rezoning (a legislative change to the map or text)
  vs.
• Variance/special use permit (case‑specific administrative approvals).

The standards, procedures, and rights are different.

Takings Clause

Rezoning and zoning changes can implicate the Takings Clause when they go “too far.”

Key Term: Takings Clause
The Takings Clause of the Fifth Amendment (applied to states through the Fourteenth Amendment) prohibits government from taking private property for public use without just compensation.

Key Term: Regulatory Taking
A regulatory taking occurs when a regulation (including zoning) goes so far in restricting property use that it is the functional equivalent of an exercise of eminent domain, requiring just compensation.

Key MBE points:

• A zoning change that physically appropriates land or requires demolition of existing lawful structures without compensation is likely a taking.
• A zoning change that eliminates all economically viable use of the property is a per se regulatory taking.
• A zoning change that merely reduces value or prohibits the owner’s preferred use is usually not a taking, as long as some reasonable, economically viable use remains.

Key Term: Exaction
An exaction is a condition attached to development approval (such as dedicating land for a road or park) that requires an owner to convey property or pay money as the price of receiving a permit.

Exactions are constitutional only if there is:

• An essential nexus between the condition and a legitimate public interest, and
• Rough proportionality between the burden imposed and the impact of the development.

These issues sometimes appear in “conditional rezoning” or development‑agreement fact patterns.

Worked Example 1.5

A city amends its zoning ordinance to prohibit all apartment buildings in a neighborhood. Several existing, lawfully built apartment buildings are located there. The city orders the immediate demolition of all existing apartment buildings without offering any compensation. An owner sues.

Answer:
The demolition order is very likely an unconstitutional taking. The owner’s structures were lawful when built and are being destroyed for a public regulatory purpose. Unlike ordinary nonconforming‑use rules (which allow continuation or reasonable amortization), an immediate requirement that existing buildings be demolished without compensation is functionally equivalent to a physical taking and triggers the Takings Clause. The best constitutional ground is the Takings Clause, not equal protection.

Exam Warning

Zoning changes that single out a very small number of properties for unique treatment—especially where they benefit a single private owner or are inconsistent with the comprehensive plan—may be vulnerable as invalid spot zoning or as violations of substantive due process. In close MBE questions, ask whether the city can articulate a plausible public purpose; if not, the rezoning may be struck down.

Revision Tip

When a zoning change or enforcement action deprives a property of all reasonably economically beneficial use, analyze it as a potential regulatory taking requiring just compensation under the Takings Clause. If some reasonable use remains, treat it as a due process challenge instead, and remember the deferential rational‑basis standard.

Key Point Checklist

This article has covered the following key knowledge points:

• Rezoning changes the zoning classification of land; text amendments change the ordinance’s substantive rules.
• Lawful existing uses and structures that no longer conform after a zoning change become nonconforming and are generally allowed to continue but may not be expanded.
• Nonconforming status can be lost by destruction beyond a set threshold, voluntary abandonment or discontinuance, or compliance with a reasonable amortization schedule.
• A vested right to complete a project typically requires a valid permit plus substantial, good‑faith reliance through construction or expenditures.
• Mere applications, plans, or land purchases do not create vested rights; but substantial reliance on governmental approvals can support a zoning‑estoppel claim in some jurisdictions.
• Zoning, including rezoning, is reviewed under substantive due process and equal protection primarily using rational‑basis scrutiny, with a strong presumption of validity.
• Spot zoning that lacks a legitimate public purpose and conflicts with the comprehensive plan may be invalid as arbitrary and capricious.
• The Takings Clause is implicated when rezoning or enforcement eliminates all economically viable use of land, or when existing structures are required to be demolished without compensation.
• Exactions and conditional rezonings must show both a nexus and rough proportionality between the condition imposed and the development’s impacts.

Key Terms and Concepts

• Rezoning
• Text Amendment
• Downzoning
• Nonconforming Use
• Amortization
• Vested Right
• Zoning Estoppel
• Variance
• Special Use Permit
• Spot Zoning
• Takings Clause
• Regulatory Taking
• Exaction