Tennessee APA 2012 Fall Conference

The Tennessee APA 2012 fall conference will be held in Memphis this year. I will be there for a panel discussion on the first day, Wednesday, October 17, and will also present a short topic,What Planners Don't No About Land Use Law. Setting aside the obvious answer, not much, I thought I'd take several issues which are problematic for all of us, for example mandatory dedications under the Supreme Court decisions in Nollan and Dolan; owner's intent under the Tennessee Non-Conforming Property Act; the Tennessee Religious Freedom Restoration Act; and finally a practical discussion concerning the common law writ of certiorari, which I'm sure not many planners have an understanding about. It is nevertheless, a good idea to have a basic concept of what that review process is all about, that is how the case gets in the court, and how the planning or code staff can maximize the possibility that the decision of the planning commission/zoning board will be upheld on appeal.

In any event, it should be an interesting conference. Unfortunately, I can't stay long, having to be back in Nashville on Thursday. But there are a number of interesting topics which I wish I could attend.

Bee Hives

The Tennessean also reported this morning (it’s a rare day when there are two zoning/codes issues in the morning newspaper) that there is a controversy in spring Hill concerning a beekeeper whose bees are prohibited by the restrictive covenants applicable to the subdivision in which he lives. There is a state statute which governs legislation prohibiting the maintenance or establishment of honeybees in hives. It is pretty interesting, and one that I had not really bumped into before.

It is found in the Tennessee Apiary Act of 1995, Tenn. Code Ann. § 44-15-101 et seq., and specifically at §124, which reads:

No county, municipality, consolidated government, or other political subdivision of this state shall adopt or continue in effect any ordinance or resolution prohibiting the establishment or maintenance of honeybees in hives, provided that such establishment or maintenance is in compliance with this chapter. This section shall not be construed to restrict or otherwise limit the zoning authority of County or municipal governments; provided, however, that a honeybee hive being maintained at a location in compliance with applicable zoning requirements on June 10, 2011, shall not be adversely affected and may be maintained at the same location notwithstanding any subsequent zoning changes.

The second sentence of the statute certainly limits the impact of the first sentence. Basically, a local government can’t adopt legislation prohibiting honeybee hives unless part of the zoning regulation. And probably, that is the most common type of regulation which would be adopted by a local government so the prohibition in the first sentence seems much less powerful when the entire provision is considered.

The issue in the case highlighted by the Tennessean article has to do with homeowners associations and restrictions adopted by those associations. Although there is a debate of some type in the paper about whether an HOA is some type of local government covered by the terms of the statute, clearly homeowners associations are not local governments. As a result, while the statutory provision which doesn’t offer much protection from local governments anyway, it offers none in the case of restrictive covenants adopted by HOAs.

Furthermore, isn’t that the way we would like our neighborhoods to operate? In effect restrictive covenants are rules adopted by all of the homeowners living in a given area prohibiting conduct which those homeowners find inappropriate in their neighborhood. The regulations aren't adopted by any government, they are adopted by the homeowners themselves, or by the developer who establishes the neighborhood in the first instance. They can be changed by action of the homeowners however at any time. Should local neighborhoods be able to make those kinds of decisions? It would certainly seem so.

One would think that the homeowner would check the restrictions and in this case, the property owner indicated that he knew of the restriction:

When I put the bees in, I knew it probably would be against the covenant, but I knew it was going to be a safe situation and if it wasn’t, I was going to remove them. I was bending the rules, but it’s not like I was raising vicious pit bulls in my backyard. I wasn’t doing anything I felt was unsafe. 

So, he did know and chose to go ahead anyway. The point is that if it disturbs others in the neighborhood, wouldn't it be better somewhere else?

In any event, this case seems to be headed for the courthouse and we’ll see what the local judge has to say about the statute and its applicability to local homeowner regulations sometime in the future.

Homeless Shelters at Green Street Church

The Tennessean reported this morning that the Green Street Church of Christ has been cited by the Metro Department of Codes Administration for a zoning violation by allowing homeless people to live in tents adjacent to the church. The church is in an industrial zoning district and surrounded by industrial uses, but the homeless "camp" does not comply with zoning. The comments from the Metro Legal Department (Tom Cross) sound as though the city would like to accommodate the church’s mission if possible.

This is another one of those areas where the Tennessee Religious Freedom Restoration Act, Tenn. Code Ann. § 4-1-407, would seem to apply. The attorney for the church, Tripp Hunt, mentioned the applicability of RLUIPA, the federal act, but as we have discussed here in the past, the Tennessee version is much more powerful. Again, the main reason is that under the federal act, you must demonstrate that there is a substantial burden on religious activities, and the federal courts interpret the phrase “substantial burden” as a fairly high burden which is somewhat difficult to overcome.

The Tennessee act however defines “substantial burden” as anything that “inhibits or curtails religiously motivated practice.” At least to me, that seems like a much easier burden to overcome. If part of the Green Street Church of Christ’s religious mission is to help accommodate and care for homeless people, then a zoning ordinance which prevents them from helping them on-site may very well inhibit or curtail the church’s religious practice.

Obviously, one of the difficulties here is that since most churches are located in residential areas, and since many residential neighborhoods would object to having homeless people moving alongside them, there is a conflict that will surely arise.

In any event, this Codes case certainly seems like an interesting case to watch. It will be even more interesting if the church employs the Tennessee Religious Freedom Restoration Act in its defense as well as the federal act.

Practical difficulties or unnecessary hardship?

Land use planning law has perhaps no other area of greater complexity than variances. And one of the interesting issues that comes up in the context of variances, is the actual standard by which the zoning board is supposed to judge whether a variance should be granted or not.

Many state statutes, including Tennessee’s, indicate that a variance should only be granted where there are “practical difficulties” or “unnecessary hardship.” But what do those two terms mean? Are they synonymous? Do they have some independent meaning each to their own? And what does it mean in the context of granting a variance?

Here in Tennessee we don’t have too many answers. Personally, I believe that it is easier to construe the two terms synonymously. But there are certainly a number of states who refuse to do that, or who will apply let’s say the “practical difficulty” standard in the context of bulk variances, and the “unnecessary hardship” standard in the context of use variances. The theory is that use variances should be more difficult to get, and that the “unnecessary hardship” standard requires a higher level of proof. Other states, such as New Jersey, construe the two standards as the same.

I don’t think use variances are legal in Tennessee, for the most part, and that makes the distinction between bulk variances and use variances pretty much academic, and there is therefore not much need for any distinction between the two standards, “practical difficulty” and “unnecessary hardship.”

The reason I bring this all up is the release of a new opinion from the state of New Hampshire discussing this very issue. The New Hampshire Supreme Court concluded that given recent legislative initiatives in their state, that the “unnecessary hardship” and “practical difficulty” terms refer to the unnecessary hardship test and are interchangeable. Merriam Farm, Inc. v. Town of Surry, 2012 WL 2913206 (NH 2012). 

I’m hopeful that if the issue ever arises here in Tennessee, that our Supreme Court will reach a similar result.

Non-Conforming Uses: Owner's Intent

I have an interesting argument coming up in Davidson County Chancery Court, Part I, this morning. The case, Richland Creek Watershed Alliance v Metro BZA, is an appeal from a decision of the Metro Board of Zoning Appeals, where they agreed that my clients property on Charlotte Avenue was legally nonconforming for a used car lot. The interesting aspect of the case is that it focuses on a provision of the Tennessee Non-Conforming Property Act, Tenn. Code Ann. § §13-7-208, which is rarely mentioned in any of the cases. This particular section, §(g) (4), provides that “the restrictions of this subsection… shall only apply if the property owner intentionally and voluntarily abandons the nonconforming use of the property. In any contested matter on the use of such property, the government has the burden of proving an overt act of abandonment in such matter.”

In our case, it was clear before the Board of Zoning Appeals that the owner never voluntarily or intentionally abandoned the nonconforming use. Furthermore, there was really no proof of any overt act of abandonment. On the other hand, nonconforming use cases rarely addressed this particular aspect of the statute, and so this case will be unusual in that way. It will be interesting to see what the Chancellor rules, and how she approaches the language of the statute. It seems relatively clear, but certainly reasonable people can differ about interpretations on what seems to be rather straightforward legislative language.

Failure to Exhaust

Last week, we discussed the new Ready Mix v Jefferson County case, 2012 WL 3757025, decided by the Tennessee Supreme Court. One of the most interesting aspects of the case to me is the issue of exhaustion of administrative remedies. When must an applicant appeal to the zoning board before going to Court? This question is a bit more difficult to answer than it should be. Back in 1992, the Tennessee Court of Appeals ruled in a somewhat similar case:

. . .  we find that the landowners have a right to obtain the board of zoning appeals' interpretation of their rights under the state laws and zoning ordinances pertaining to the erection and maintenance of a billboard on their property. We also find that review by the board of zoning appeals would be efficient and effective. Accordingly, we concur with the trial court's dismissal of the landowners' complaint because they have not exhausted their remedies before the board of zoning appeals.

Robison v. Metro. Gov't of Nashville & Davidson County, 90-3031-I, 1992 WL 205268 (Tenn. Ct. App. Aug. 26, 1992)

Ready Mix itself cites State ex rel Moore & Associates v West, 246 S.W. 3d 569, 577 (Tenn. App. 2005). In that case, the owner of a newly constructed hotel in Nashville filed suit concerning the interpretation of the zoning ordinance by Sonny West who concluded that a landscape buffer was required. The trial court ruled in favor of the owner, but on appeal, the Court of Appeals dismissed the lawsuit, holding that the owner first had to file an appeal to the zoning board, explaining that the "challenge was to the zoning administrator's denial of the certificate… [rather than] the validity of the ordinance requiring the buffer or the applicability of that ordinance to its hotel."

Notice however, that in the Moore case, the interpretation involved the zoning ordinance, not the applicability of a state statute.

In  Ready Mix, the Supreme Court ruled that the "primary issue for consideration was the applicability of the grandfather statute," and that no administrative appeal was required.

In this instance, the Company has, in our view, presented a challenge to the applicability of the zoning ordinance rather than to the discretion of the zoning official who issued the stop work order. The complaint required an assessment of whether the Company, by its actions prior to the passage of the zoning ordinance, invoked the protections of Tennessee Code Annotated section 13-7-208 and qualified as a direct challenge to “the applicability of th[e] ordinance” to the property. An administrative appeal to the board of zoning appeals “would have afforded no review over the key issue[].”

I certainly believe that the Supreme Court reached the right conclusion. I approach it from a similar standpoint but carry it to a further extreme.

In my opinion, the board of zoning appeals has no business construing a matter of state statutory law. Tenn. Code Ann. §13-7-109 (and as to municipalities, §207) grants the board of zoning appeals the power to "hear and decide appeals where it is alleged… that there is error in any order, requirement, decision or refusal made by the County building Commissioner or any other administrative official in the carrying out or enforcement of any ordinance enacted pursuant to this part."

The key words, from my perspective, are "enforcement of any ordinance enacted pursuant to this part." There was no error in the interpretation of the ordinance enacted pursuant to that section of the Tennessee Code. In these non-conforming property cases, the question is the interpretation of the state statute, §13-7-208. The zoning board only has the authority to interpret and conduct hearings concerning ordinances enacted pursuant to the enabling legislation. TCA §13-7-208 is not an ordinance; it is a state statute that has direct impact and should only be interpreted by members of the state judiciary. A zoning board, a planning commission, the local legislative body, all have no business interpreting the provisions contained within §13-7-208. Those provisions apply directly to the local governments; they are not adopted by local regulation or at least, need not be. It seems to me therefore that when the principal issue in the case is the applicability of §13-7-208, there is no jurisdiction before any administrative body, and the case must be litigated in the state courts.

Let's approach it from another angle just briefly. There are 95 counties in the state of Tennessee most of which now have zoning; there are many more municipalities. We could wind up with a different interpretation of the state statute in each of the countys and each of the municipalities if zoning boards are allowed to interpret these state provisions. It makes much more sense to have state judges  rule on the applicability and interpretation of state statutory requirements, rather than allowing a zoning board or planning commission or local legislative body, the majority of whose members have no training in the law anyway.

Certainly, if the applicant is relying on a local zoning regulation to demonstrate that the property is legally non-conforming, such as where the issues involve residential properties not protected by the state statute, the zoning board certainly has jurisdiction to hear and decide those cases. But where the owner relies on the protection of the state statute, there is no reason to go to the zoning board. The case should be considered by the state judiciary without the interference of local administrative decision-making.

As a result, the decision in Ready Mix certainly seems to be correct; I would even extend it further based on my analysis above. In any event, it is a very interesting case, and it strongly suggests that the Supreme Court believes that in cases involving non-conforming properties, that direct action in the state courts is generally appropriate when the primary issue for consideration is the applicability of the grandfather statute.

New Philly Zoning Getting Good Reviews (so far)

The new Philly zoning ordinance seems to be getting reasonably good reviews in the first week or two after its adoption. One news source up there reported that generally the developers and neighbors were supportive and that obtaining permits and demonstrating compliance was simpler and easier than under the prior version of the zoning regulations. We probably should wait and check back in a year or two, and then see what everybody is saying. Take a look at the report here.

Memphis UDC

A few days ago,Josh Whitehead posted on the Shelby County blog that the final version of the Memphis and Shelby County UDC had been approved by both the city and County legislative bodies in August and the final modified and paginated document was up on the website. It was a controversial process, but likely well worthwhile. You can find the final version of the UDC [Unified Development Code] here.

Vested Rights

In the case I mentioned yesterday, Ready Mix v Jefferson County,  2012 WL 3757025,  the court briefly discusses the vested rights doctrine in a way which I think simply and accurately describes the doctrine. Justice Wade drops a lengthy footnote (#18) discussing the doctrine indicating that "in general, the vested rights doctrine provides the zoning ordinance may not retroactively deprive a property owner's use of property. According to one authority, two conditions must be met in order to claim protection under the doctrine: (1) prior approval by the governmental authority; and (2) a substantial change in position by the property owner in reliance on the prior approval." The court cites the well-known McQuillin on Municipal Corporations as authority.

I have always found this formulation of the vested rights doctrine to be the easiest and simplest understand. When I speak about this topic, in fact I simplify it further: the developer must have (1) a building permit, and (2) substantial construction must've taken place. Of course, the governmental authorization does not necessarily have to be a building permit, but that is generally the type of approval given; and in addition although a substantial change in position is the actual legal formulation of the doctrine, generally speaking, it takes substantial construction on the property in order to best the rights. Simply expending monies in preparing the property, doing architectural or engineering work, or other kinds of activities, is usually insufficient.

The court recognizes that the vested rights doctrine does not technically apply in this case inasmuch as the County did not give prior approval to the quarry operation. but it is interesting that the court discusses the vested rights doctrine and uses it as an additional consideration in concluding that the newly adopted zoning regulations do not prevent the operation of the quarry.

It is worthwhile keeping in mind the simple formulation of the vested rights doctrine which the Tennessee Supreme Court now has approved: "In sum, reliance on the vested rights doctrine requires issuance of the building permit, plus substantial construction and/or expenditures." Citing CK Development LLC v Town of Nolensville, 2012 WL 38287 at *11. I don't think that there is anything particularly new about this, but it just serves to emphasize the simplicity of the vested rights doctrine and the importance of obtaining a building or other permit in order for the doctrine to apply.

The Diminishing Assets Doctrine

Last week the Tennessee Supreme Court handed down an interesting and important case relating to nonconforming properties here in Tennessee, and reversing a decision of the Tennessee Court of Appeals. The case is Ready Mix v Jefferson County, 2012 WL 3757025, and the issue presented was whether or not the quarry activities were sufficiently established on the property such that a new zoning resolution adopted by the County did not limit the continuation of the quarrying activities. The Court of Appeals had ruled that the quarry owners had failed to exhaust administrative remedies because they proceeded directly to court, rather than to the Board of Zoning Appeals. the Supreme Court found that the quarry owners did not need to appeal to the zoning board, because the real question was a legal one concerning the applicability of the zoning ordinance itself rather than to the discretion of the zoning official who issued a stop work order in this case.

After a discussion of nonconforming properties, and the requirement of "substantial" activity before the adoption of the zoning regulations in order to validate the existence of the nonconforming use, the court turned to an analysis of the diminishing assets doctrine.

The Supreme Court emphasized that whether a particular business is "in operation" depends to some extent upon the nature of the business itself. Since the mining and quarrying industry is comprised of the excavation and sale of the very natural resources that make up the property, those reserves may be considered pre-existing uses themselves in the event of a more restrictive zoning change. Applying the doctrine to the facts in the case, the court concluded that the company had engaged in a variety of activities on the property prior to the adoption of the zoning regulations. The company applied for permits from the state government, analyzed suitability as a quarry site, cleared overgrown brush and vegetation from the pre-existing bits which had been used previously, and moved substantial equipment on the property. In addition, at least two completed blast shots were performed on the property before the adoption of the zoning regulations.

The Supreme Court held that the evidence did not preponderate against the trial court's finding that the activities established a  pre-existing use and qualifed for protection under the Tennessee Non-Conforming Property Act. the court indicated that "substantial steps" in construction may often satisfy the Non-Conforming Property Act, and that a demonstrated "devotion of the property" to particular use can also result in a finding of a non-conforming use protected by the statute.

Over the next week or so, I will come back to discuss both the diminishing assets doctrine, and the failure to exhaust issues presented by this case. in addition, Justice Wade, writing for the Court, briefly discusses the vested rights doctrine which is worth considering as well. We will try to take a look at that also in the next few days.

It is certainly an interesting case, applying the "in operation" language of the Tennessee statute in a flexible way so as to protect the demonstrated assets of this quarrying company.