טכניון מכון טכנולוגי לישראל
הטכניון מכון טכנולוגי לישראל - בית הספר ללימודי מוסמכים  
M.Sc Thesis
M.Sc StudentTal Tsafrir
SubjectDeveloper Obligations to Reimburse Local Planning Boards
for Compensation Claims by Landowners Due to Plan
Amendments
DepartmentDepartment of Architecture and Town Planning
Supervisor Professor Emeritus Alterman Rachelle
Full Thesis text - in Hebrew Full thesis text - Hebrew Version


Abstract

Israel's planning law grants landowners the right to claim compensation for damages they have suffered from plan amendments (e.g.  reduction of building rights, re-zoning, etc.).  The duty to pay falls on the Local Planning Commissions. Israeli courts have described this duty as contributing to the planning process by internalizing the negative externalities caused by amendment to statutory plans. In recent years, however, LPCs have taken to demanding that the initiators of plan amendments enter into an agreement designed to recompense, or reimburse, the LPC for its expenses in paying such damages. Such agreements supposedly undermine the ratio legis for this statutory requirement.


As a mainly recent phenomenon, Israeli research and court rulings have not yet presented a systematic look at the status of these re-compensation agreements. The Israeli legislator has also chosen to address the issue sporadically: in providing for ad-hoc shifts of the burden in certain public infrastructure projects and in setting procedural rules for the participation of a compensator in appeals regarding plan damages.


In this work, we undertook a trailblazing small-scale field-study in order to assess the extent of the use of such re-compensation agreements and to characterize that use, and to find out if the practice serves a commendable social-economic-planning function by examining its theoretical foundations and justifications critically.


We conclude that despite the relatively short period since the increase in the use of re-compensation agreements, it has reached a relatively high level of institutionalization:

ü      There is widespread awareness of this tool

ü      A relatively explicit array of considerations affecting the decision to demand a re-compensation agreement has been consolidated

ü      There exists a set format of a re-compensation agreement


It is evident, however, that there is widespread discomfort in LPCs regarding the use of reimbursement agreements stemming from the vagueness of their legal status.  We take this to be a symptom of a wider-context problem -- the fair distribution of plans' benefits and damages between stakeholders (LPC, local authority, District Planning Commissions, plan initiator, landowners).


Yet, when we examine the existing state of affairs -- a statutory requirement that LPCs offer compensation for plan damages, coupled with a præter legem practice of reimbursement agreements -- we find it satisfactory.  We feel there is no pressing justification or need for regulation of this practice, only for its formalization.