In 2024, as part of “An Act to Strengthen Massachusetts Economic Leadership” (also known as the “Leads Act”), the Massachusetts Legislature enacted the 2024 Permit Extension Act, which automatically extends, for two years, any “approval” (including permits, certificates, licenses, variances, and waivers, issued by any state or local entity), for the use or development of real property, issued or in effect during the “tolling period,” January 1, 2023 through January 1, 2025. Like previous permit extension acts enacted in 2010 and 2012 in response to the 2007 financial crisis, the 2024 Permit Extension Act provides that approvals granted during the tolling period are extended for two years “in addition to the lawful term of the approval.” 2024 Mass. Acts. c. 238, § 280(b)(1) (emphasis added). At the time Governor Healy signed the Leads Act in November of 2024, there was some uncertainty regarding this phrase, “in addition to the lawful term of approval,” and whether a statutory permit extension runs concurrently with, or consecutively to, other certain extensions or tolling periods. For example, if a permit granted during the statutory tolling period is appealed and the permit ultimately affirmed, at the end of the litigation, would the permit be in effect for the term of lawful approval plus two years, or is the life of the permit the term of lawful approval plus whatever amount of the two-year extension remains? There is now some clarity following the Massachusetts Appeals Court’s May 7, 2025 decision in Palmer Renewable Energy, LLC v. Zoning Board of Appeals of Springfield, 105 Mass. App. Ct. 518 (2025), which found that the statutory permit extension of a developer’s building permits began to run after the term of the permit as extended by the equitable principle of litigation tolling.

While the practical and procedural implications of this decision are important, providing clarity that a development or other project will benefit from a statutory permit extension even if subject to years of litigation, the underlying public policy implications are just as noteworthy.

The Palmer Renewable Energy decision involves the application of the Massachusetts 2010 Permit Extension Act, as amended in 2012 (“2010 Act”), to two building permits granted to Palmer Renewable Energy, LLC (“Palmer”) by the city of Springfield’s building commissioner in 2011. The 2010 Act, which extended the expiration of certain local and state approvals issued between August 15, 2008 and August 15, 2012, for a period of four years, was enacted by the Legislature in response to the 2007 financial crisis and subsequent recession. Like the 2024 Permit Extension Act, the 2010 Act provided that the extension was “in addition to the lawful term of approval” of a permit granted during the tolling period. In 2011, Palmer obtained two building permits for the construction of a biomass-fired power plant in Springfield, both of which were appealed, resulting in years of litigation. The initial period of litigation began when the city of Springfield appealed the building permits to the Springfield Zoning Board of Appeals (“ZBA”) in 2011, and ended on October 30, 2015, following a decision of the Land Court reinstating the permits. The ZBA revoked the building permits for a second time in 2021, and Palmer, again, appealed to the Land Court. This time, however, the Land Court affirmed the ZBA’s decision to revoke the permits, finding that the language in the 2010 Act extending a permit for four years “in addition to the lawful term of approval” was ambiguous as to whether it included a period of litigation tolling, and holding that Palmer’s building permits expired in May of 2016 because the permit extension ran concurrently with the period of litigation tolling.

The Appeals Court reversed the Land Court’s decision, finding that the four-year extension of Palmer’s building permits began to run after the term of the permit as extended by the litigation tolling. As a starting point, the Appeals Court considered the purpose of the equitable principle of litigation tolling, which is “to ensure that a permit holder is not forced to make difficult economic decisions when litigation ‘clearly attributable to others’ has the effect of eating up the time a permit remains valid,” and reasoned that the Legislature did not intend the statutory permit exception to run consecutively with equitable tolling because it was aware, when it enacted the four-year permit extension period, “that the original term of a permit or approval may be extended in a variety of ways – including by litigation tolling.” Additionally, the Appeals Court expressly found that the phrase “in addition to the lawful term of approval,” was not ambiguous and could not be interpreted to allow an exception for permits that have been extended by litigation tolling. Although the Land Court had been persuaded that the emergency nature and immediacy of the 2010 Act indicated that the Legislature had not intended consecutive extensions, the Appeals Court said, “That the permit extension act was enacted on an emergency basis informed developers and municipalities promptly that certain permits might have expired were otherwise valid. Yet, the four-year length of the extension belies the idea that the Legislature expected ‘shovels in the dirt’ immediately.”

As a result of the Appeals Court’s decision in Palmer Renewable Energy, Palmer’s building permits, the original lawful term of which, without any tolling or extensions, would have been 180 days, ended up lawfully in effect for a period of over ten years. While the practical and procedural implications of this decision are important, providing clarity that a development or other project will benefit from a statutory permit extension even if subject to years of litigation, the underlying public policy implications are just as noteworthy. The Appeals Court’s holding that a statutory permit extension runs consecutively to, not concurrently with, a period of litigation tolling signifies not only an affirmation of the Legislature’s intent to promote development in times of economic and social hardship, but also, an endorsement of the public policy encouraging development in the Commonwealth and protecting developers from the difficult economic choice between waiting to begin development until a permit appeal is resolved (which, in many cases, could be well after the lawful term of the permit itself has expired), and starting construction with the risk that the appeal will be successful and the permit revoked. To the extent of the 2024 Permit Extension Act’s purpose to promote development in the Commonwealth by providing an additional two years to the lawful term of the permit issued during the tolling period, the Appeals Court’s decision in Palmer Renewable Energy reinforces the notion that all permit-holders will benefit from the extension, even if they cannot get “shovels in the dirt” immediately because of ongoing litigation.