OCEAN CITY — Resort planners this week took no action on a proposed code change that could eliminate or at least limit special exceptions for parking amid concerns it could stifle redevelopment projects in town.
For the last few months, the Ocean City Planning Commission and staff have been exploring ways to tighten certain loopholes and exceptions in the zoning code for new development that sometimes result in less desirable projects. For example, there are transfer development rights (TDRs), special exceptions and parking non-conformity.
The latter has been discussed at great length, beginning with a public hearing that was tabled in December. That public hearing on parking non-conformity resumed at the planning commission meeting on Tuesday, sparking an often-tense debate.
A parking non-conformity allows a property to be redeveloped in certain circumstances when the available land on the site does not allow for the parking requirements to be met. For example, a property owner desiring to build a 60-room hotel might only have space to provide 50 parking spaces on site after other requirements such as setbacks, landscaping and sidewalks are met. Town planners and staff can approve the parking non-conformity under certain circumstances if, for example, the developer can provide additional parking spaces offsite.
Town planners and staff generally hold developers’ feet to the fire on the parking requirements, but there are instances when non-conformities are granted. To that end, town planners have been working on a code amendment that could change some of the language regarding parking non-conformity. For example, proposed changes in the language in the code discussed during Tuesday’s public hearing would allow a property owner to keep a parking non-conformity only in cases where there was not a substantial change in the use, density or bulk. It was the “change in use” language that caused the most heartburn for property owners, developers and lawyers in attendance on Tuesday.
Zoning Administrator Frank Hall explained how the proposed language change in the code would affect parking non-conformity.
“You would only be able to keep the parking non-conformity if there was no change in the use, bulk or density,” he said. “If you have a 10-space non-conformity for a 60-room hotel and you tear it down and build a new 60-room hotel, you keep the non-conformity. If you rebuild with a 70-room hotel, you lose the non-conformity.”
However, attorney Joe Moore, representing multiple clients, said the code change as proposed threatened to slow redevelopment because of the stringent parking requirements if non-conformity was taken off the table.
“If I understand this, I have a hotel and I change it to a restaurant use, I lose the non-conformity,” he said. “If I change from a motel to a condo, I lose the non-conformity. Same thing if I change from a restaurant to a hotel. The purpose of allowing non-conformity is to encourage redevelopment and economic development, but that goes away if I’m reading this right.”
Moore suggested a change in the use of a property would not necessarily change the intensity, and thus, the need for more parking.
“What is the detriment if the change in use does not intensify the use?” he said. “Why is change of use even in there? Density and bulk can change the intensity, but they can be addressed in other ways.”
Moore said eliminating parking non-conformity ran afoul of the comprehensive plan’s desire for redevelopment.
“Anything that prohibits redevelopment is a detriment to the code,” he said. “The comprehensive plan calls for redevelopment. If this doesn’t stop redevelopment, it at least stifles it.”
However, Planning Commissioner Peck Miller said while the proposed code change would apply to all of Ocean City, the problem was particularly acute in the downtown area, a problem that could have been alleviated if a proposed parking garage had ever been built.
“There is a theory and I subscribe to it is that we need a parking garage downtown,” he said. “With adequate parking, the whole non-conformity issue would go away.”
Miller said the proposed code change was not directed at a developer that needed 10 parking spaces, but only had the space for eight. Rather, it was for larger projects that had found a way to get around the parking requirements using the non-conformity allowance.
“If somebody builds a 100-room hotel with 30 parking spaces, that’s a problem,” he said. “It’s a complex situation and we need to begin to at least address it. I don’t think we can give parking non-conformity on large projects downtown and get the downtown we’re hoping for.”
Planning Commission Chair Pam Buckley said parking non-conformity was just part of the equation. She said some savvy developers were combining parking non-conformity with TDRs and other loopholes to push through projects that fell short of meeting the code.
“This town has been hit with people coming in and grabbing two or three different things in our zoning code and overlapping them and it has to stop,” she said. “There are cases where the horse is already out of the barn, but we need to fix these things. That’s why we’re having this dialogue.”
Moore agreed the parking garage proposed for decades could ease the problem, but it was up to the Mayor and Council to ultimately find a space for it and fund it.
“You’re talking about a societal problem controlled by the Mayor and Council,” he said. “You’re creating circumstances that will absolutely stifle redevelopment. Nobody can deny redevelopment is good for downtown.”
The Mathias family property on the corner of Baltimore Avenue and Worcester Street was also used as an example. Over several decades, the property has been home to a billiard parlor, an underage club and lately a haunted house. The family will likely be seeking a new tenant as the haunted house appears to be shuttered. However, if the new tenant represents a change in use, for example a restaurant or a retail store, the property could lose its parking non-conformity.
Former Mayor and State Senator Jim Mathias, speaking on behalf of the family, said losing the parking non-conformity because of a change of use could deter or at least limit what could go in there. For example, if the Mathias property had a non-conformity exception for seven spaces, but a new use would require say 20 spaces, the property could not be redeveloped unless an additional 13 spaces were obtained somehow under the proposed new language in the code.
“I’m deeply troubled by the word ‘use’ in this,” he said. “We’ve been down that road before. Every time we go through this with use, you run the risk of having another vacant property there. This, as written, has the potential to take away responsible capital investment.”
Hall said the tenor of the debate on Tuesday suggested a deeper dive into the parking problem in general.
“If a code change sparks this much debate, maybe we need to take a closer look at the root of the problem,” he said.
However, Miller said issue continued to be the change in use when a property is redeveloped.
“We need to take a closer look at change of use,” he said. “There have been cases in Ocean City where we’ve had a significant change in use, but haven’t gotten any more parking spaces.”
Architect Keith Iott said the standard procedure for redeveloping property in Ocean City is to first determine what the parking non-conformity is and then designing a project that meets that parking standard along with other requirements such as setbacks and landscaping, for example. He applauded the town’s allowance for parking special exceptions under certain circumstances and said it was a rather rare allowance around the shore and beyond.
“I don’t know of any other municipality on Delmarva that perpetuates non-conformity,” he said. “Frankly, I think it encourages redevelopment in a good way.”
Attorney Regan Smith, representing several large property owners in the downtown area, said the parking issues date back decades.
“This problem started in 1968 with a zoning code that never recognized that downtown Ocean City was built before there were cars,” he said. “We had a 1968 suburban parking code for north Ocean City that didn’t recognize that we had an already-built downtown that didn’t have any parking.”
Smith said the result has been a slowing down, if not a halt, to redevelopment in some cases.
“What we ended up with is what I consider a brake on redevelopment because it’s very hard to do a project because there is no parking,” he said. “… When we redevelop property downtown, we use non-conformity. The result has been significantly good projects that have been a benefit to the town, increased the tax base and have been an improvement over what existed before.”
Ocean City Development Corporation (OCDC) Executive Director Glenn Irwin said the current parking non-conformity allowance makes sense somewhat in a densely developed downtown area built out long before the parking code was written.
“Downtown … is very compact, but compact in a good way,” he said. “You want your downtown area compact because it encourages people to walk around and come down off the Boardwalk and visit the businesses on the side streets.”
Irwin cited the recent redevelopment of the Fat Daddy’s property on Baltimore Avenue near Talbot Street as an example. The property now features a restaurant and some retail on the street level along with seasonal worker housing on the second floor. If not for the non-conformity parking allowance, the project would not likely have been possible.
“The Fat Daddy’s project … would have needed 35 parking spaces without non-conformity,” he said. “They would have had to find two or three other lots to meet the parking requirements and it probably wouldn’t have been doable.”
After considerable debate, the planning commission entertained a motion to deny the proposed code change regarding parking non-conformity, but that motion failed to pass by a 3-3 vote with planning commissioner Palmer Gillis absent. Instead, the planning commission and staff will go back to the drawing board to work on language that will accomplish the goals while not impacting redevelopment.
