DES' authority to permit changes to residential structures that extend over public waters is extremely limited. If you read RSA 482-A:26 you will note that the Department can permit the repair of foundations and interior renovations that result in reduction in kitchen and bath space. Any expansion of dimensions or use is strictly prohibited by law and not within the Department's authority to consider. The Department does not do the enforcement on these issues when they arise. They are the purview of the Department of Justice. DES' role is essentially reduced to technical support. A full discussion of residential structures over the public trust is best left to an attorney and I am not one.
As for Fay's, DES pursued a case against them in the 80's before I came on board. What you see today is the result of the Court's decision on that case. I would have to refer you to that decision for the answers you seek.
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