The new North Carolina state budget, effective July 1, 2026, includes several significant changes to the state's land use and development laws. Among the most notable changes for developers and property owners are the expansion of permit choice protections, streamlined appeals of administrative decisions, broader recovery of attorneys' fees, and expanded standing to challenge local government decisions.

In a separate piece of new legislation, developers and property owners will no longer be required to build a minimum number of parking spaces in most jurisdictions.

Permit Choice Expanded to Rezonings

Permit choice now applies to rezoning applications. If zoning regulations change after a rezoning application is submitted, the applicant may elect to have the application reviewed under the regulations in effect when it was filed. Permit choice beginning earlier in the entitlements process could have a significant impact on the applicable regulations for development projects.

Appeals of Administrative Decisions and Written Interpretations

One of the most significant legislative changes under the new budget is the elimination of the requirement that parties first appeal an administrative decision to the board of adjustment before seeking judicial review. Board of adjustment review is now optional rather than mandatory. By allowing applicants and property owners to proceed directly to court, the legislation shortens the path to judicial review. Trade associations have also been given standing to appeal administrative decisions involving the interpretation or application of development regulations on behalf of their members.

Furthermore, courts must now award reasonable attorneys' fees when a party successfully challenges a local government in this context. Previously, mandatory fee awards were generally limited to permit choice and vested rights claims. This change expands the circumstances in which successful challengers may recover their litigation costs.

Statewide Parking Reform

House Bill 162, otherwise known as the Parking Lot Reform and Stormwater Control Act, prohibits most local governments from requiring a minimum number of off-street parking spaces. The new law, separate from the state budget, becomes effective January 1, 2027, and applies statewide except in certain coastal-area jurisdictions.

This reform is significant for developers and property owners because it allows them to only build the number of parking spaces that the market demands and project budgets dictate.

For more information about these statutory updates and how they may apply to your project, please contact us or your regular Parker Poe contact. Click here to subscribe to our latest alerts and insights.