In these very days, NOP [TAMA] 38 will come to an end for all local authorities that did not advance independently or through the Governmental Authority for Urban Renewal (hereinafter: “the Authority”), an alternative plan to NOP 38, which was canceled back in 2019.
Let’s begin by mentioning that the purpose of NOP 38, which came into effect in 2005, was to strengthen old buildings that were built without the standard against earthquakes, through the addition of building rights, which will be granted either by additional floors to be built on top of the specific building (TAMA 38/1) or through the demolition of the existing building and the construction of a new building under it (TAMA 38/2).
Notwithstanding the aforementioned, over the years much criticism has been raised about NOP 38 according to which it is actually implemented only in the center of the country and not in the peripheral areas which are more exposed to earthquake damage. Also, critics of the program claimed that NOP 38 does not take into account the increase in the population created as a result of each project, which includes a load on the infrastructures, educational institutions and the community, parking lots as well as the lack of areas for public areas and structures.
Therefore, in 2019, the National Planning and Construction Council decided that NOP 38 would come to an end in October 2022, a date that was postponed to October 2023 and then postponed again for another 4 months until 28.2.24. The temporary order provisions enacted following the War that begin on October 7th 2023 established an automatic extension of 6 months for all government programs, including NOP 38, which was automatically extended for the last time until 29.8.24.
To complete the picture, we shall note that the date 29.8.24 was determined to be the deadline for submitting alternative plans promoted by the Authority, while the deadline for submitting plans initiated by the local authorities themselves was only extended until 1.8.24.
The alternatives to NOP 38:
The legislator created a number of alternatives to NOP 38, the first of which is a plan for evacuation and reconstruction (Pinuy Binuy), which applies to an entire complex, in contrast to NOP 38 which applies to only one building, and which still operates without any changes.
In addition, there is the alternative approved by the former minister Ayelet Shaked (hereinafter: “the Shaked Alternative“) as well as alternative plans promoted by the local authorities to regulate the field of urban renewal.
We will specify briefly that the Shaked Alternative allows for urban renewal in the form of demolition and construction while granting building rights of up to 550%, or in the form of thickening and strengthening an existing building while granting building rights of up to 200%. In addition, the Shaked Alternative also allows for the allocation of public areas, an important point that was missing in NOP 38. The most important news that the Shaked Alternative has brought with it is the possibility of obtaining a building permit at the same time as submitting and promoting a specific plan (City Building Plan), and not as was customary earlier when these two operations were done in a row, and not simultaneously.
At the same time, local authorities can promote, independently or through the Authority, alternative plans to NOP 38 to regulate the issue of urban renewal in their area, which in practice will extend the validity of NOP 38 until mid-May 2026 or until the date of approval of the alternative plan, whichever comes first. The purpose for this is clear; to create a period of overlap between the two plans and to prevent a planning vacuum that would leave all those involved (entrepreneurs and apartment owners alike) back in square one.
A clear advantage in actually promoting an alternative plan for each local authority on its own is that each authority will be able to adapt the alternative plan in its area to the nature of construction and the specific needs of its population, capacity and infrastructure, issues that cannot be “tailor made” specifically for each and every authority under NOP 38 or under the Shaked Alternative.
For which authorities is the decision relevant?
In practice, the extension of the ending date of NOP 38 was relevant for only 8 local authorities which were the last to reach the stage of submitting the alternative plan and approving it in the relevant planning institutions. These authorities are Lod, Ashkelon, Tel Aviv, Rishon LeZion, Ramat Gan, Beit Shemesh, Bnei Brak and Bat Yam. At the time of granting the extensions, the other relevant authorities (among them Ramla, Nahariya, Yavne, Hadera, Petah Tikva, etc.) have already submitted the alternative plans and as of the time of writing this article, they are in various stages of approval.
Without derogating from the above, out of the 8 authorities listed above, which were the last to submit the alternative plan on their behalf, 3 central authorities which are Tel Aviv, Bnei Brak and Bat Yam, which promoted the alternative plan in their area independently and not through the Authority, did not submit the plans on their behalf within the deadline set for them, and therefore NOP 38 has completely expired in their territory (except in relation to the Tel Aviv quarters plan, where the subject of urban renewal per a specific building is promoted very intensively).
Summary:
As of the time of writing these lines, it seems that the major local authorities in Israel are working to regulate the field of urban renewal in their territory, as part of one of the ways detailed in this article. It should be noted that most of them chose to draft and approve an alternative plan for NOP 38, which means an extension of NOP 38 until May 2026 at the latest.
Whether through the initiation of an alternative plan or through the adoption of a Shaked Alternative, the construction and development potential inherent in urban renewal plans (whether local or national) is large and includes thousands of units that may become “breathable air” for all those young families who try to purchase an apartment and are unsuccessful in light of the problems in the Israeli real estate market stemming, inter alia, from a lack of apartments.
Therefore, we believe that the utmost importance should be given to urban renewal projects, be the planning umbrella as it may.
For more information please contact:
Hanan Efraim, Adv. Hadar Yair, Adv.
Office: 03-691-6600 Office: 03-691-6600
Email: hanan@ekw.co.il Email: hadar@ekw.co.il