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Just like all the other sheds in your photos.
They might have been built without a permit as well. I don't think the fine will happen, but don't be totally surprised if it does.

The setbacks are required for fire breaks and access. The shed is combustible and if on fire will "lick" flames on the adjacent property. If they have a shed/home/tree close, it will burn, then if it's close to another it will and on and on.

Structures within the setbacks are usually required to have some kind of fire rating to them for this reason.
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