The forgotten law: Planning Commission review of capital expenditures

When government proposes to buy land, buildings, renovate or build, the proposal should be reviewed by that government’s planning commission first.

The forgotten law: Planning Commission review of capital expenditures

Maybe the most forgotten part of the Michigan Planning Enabling Act – or the most ignored – is the requirement for the planning commission review of a government’s proposed construction or purchase of a street, square, park, playground, public way, ground, other open space, new building, addition or other structure.

Following adoption of a master plan, section 61 of the Michigan Planning Enabling Act (MCL125.3861) requires a planning commission to review the “location, character, and extent of the street, public way, open space, structure, or utility…” before construction or authorization for construction begins (MCL 125.3861(1)).

The planning commission only has 35 days to act on the review. If it does not meet that deadline, work on the project may proceed without planning commission review.

“The planning commission shall submit its reasons for approval or disapproval to the body having jurisdiction. If the planning commission disapproves, the body having jurisdiction may overrule the planning commission” (MCL 125.3861(1)). The override vote is 2/3 of the entire membership in a township, or a majority of its membership in a city, village or county (MCL 125.3861(1) and (2)).

There are a number of reasons for this. Historically, this system was put in place for there to be another public review of major expenditure of public funds. This was in reaction to the Tammany Hall corruptions scandals near the turn of the century, when many public works projects were based on providing government construction contracts to “friends” rather than based on need or planned development of a community. The planning commission review, based on compliance with a master plan, was a reform intended to end that practice, and tie public works construction to a larger picture plans for the community.

Currently, a local government is not subject to its own zoning ordinance. Thus, a local government does not have to obtain a zoning permit from itself (Morrison et al. v. City of East Lansing, 255 Mich. App. 505 (2003)). The capital improvements (public works) review is one means for the planning commission to review and look at the same things what would otherwise be covered during the process of obtaining zoning approval.

The review by the planning commission should focus on if the proposed capital project/public works project is within the adopted master plan, or at least does not contravene the adopted master plan. The review with the master plan is to find if the project fits within the future direction for the community.

Each review comment made by a planning commission should be specific, and should include a direct citation to the chapter and verse of the master plan and working papers (e.g., page number, paragraph, or goal, objective, strategy enumeration). If the concern or comment cannot be directly tied to such direct citations then the comment should not be made by the planning commission.

You may frequently find that the master plan does not reference a particular project, or the plan is just not specific enough. In such cases, it is appropriate for the planning commission to respond to the request for review by saying something to the effect that “we have no comment.”

The Planning Act does not provide a clear definition of what is a capital improvement versus what is ongoing maintenance or minor work. Some governments or planning commissions have adopted policy which details when they will or will not review a capital improvement. For example, replacing a door in a building or other interior renovations might be something not reviewed. Routine replacement of patrol cars may not be subject to planning commission review. But items over a certain amount of dollars, any acquisition, addition or renovation of real property would need to undergo the review process. Policies are as varied as there are governments which have adopted such policies.

Michigan State University Extension has two resources to help guide a planning commission in conducting these reviews. First is Land Use Series: “Checklist #1K; Review of Infrastructure/Public Capital Expenditure.” This checklist walks through the steps and documentation needed to conduct the review. Second is Planning and Zoning*A*Syst. “#11: Capital Improvements Review.” The Planning and Zoning*A*Syst. is part of a series of materials found at web site and at the MSU Extension book store (type “land use” in the search box). This series is designed to be a self-performance audit of a local government’s planning and zoning program. The materials ask leading questions to help a community evaluate the quality of their planning and zoning system.

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