Expanding Your Business may Implicate Pennsylvania’s Doctrine of Natural Expansion
November 23, 2021
Business owners are constantly looking for ways to remain competitive and take advantage of trade opportunities. Often, this means businesses will incorporate new operations or undergo expansion to generate supplemental sources of income. Before renovating or adding onto facilities to accommodate expanded operations, however, business owners should confirm that such an expansion is permitted under local zoning regulations.
In Pennsylvania, almost every municipality maintains its own zoning ordinance that regulates how a property in a specific zone can be used. While a business may begin its operations when a use is expressly permitted, changes in zoning ordinances can render the use nonconforming. In that case, if a business was legally established at its present location, the use will be permitted to continue, despite now being prohibited, because it is a lawfully pre-existing nonconformity (“nonconforming use”).
Pennsylvania law provides certain protections to nonconforming uses. One such protection is the right to expand, in accordance with the court-created natural expansion doctrine. In sum, the doctrine permits a landowner to expand a nonconforming use despite its nonconforming status. The Pennsylvania Supreme Court has held that this right is not unlimited, however, and municipalities may impose reasonable restrictions on the expansion of a nonconforming use.
For example, in a 2021 Pennsylvania court case– Dipal Corporation v. Chartiers Township Zoning Hearing Board—a company was operating a convenience store and restaurant in a building before the area was rezoned to residential, establishing the company’s nonconforming use. The company sought to expand its business at the convenience store by selling beer and wine; however, this required adding a seating area within the convenience store in order to obtain the approval from the Pennsylvania Liquor Control Board. When the company added seating inside its store, the Township’s Zoning Officer informed the company that it had improperly expanded the nonconforming use of the property.
On appeal, the Zoning Hearing Board (“Board”) agreed with the Zoning Officer, holding that the use of the property was altered from a convenience store to a sit-down eating establishment. However, the Commonwealth Court of Pennsylvania disagreed, reasoning that the Board had an overly technical assessment of the convenience store’s existing use. The Commonwealth Court noted that “[u]nder the doctrine of natural expansion, ‘it is not necessary that the proposed use be identical to the existing one; rather, similarity is what is required.’”
What does this mean for business owners? At a minimum, an owner of a nonconforming business should ensure that any proposed use of his or her property will share similarities to the existing use before investing time and money towards new operations. The business owner should also consult their municipality’s zoning ordinance to determine how expansion of nonconformities are regulated at a local level. If you have questions about this post or the zoning ordinance in the municipality where you do business, please contact the McNees, Wallace & Nurick Real Estate Group for assistance.