Wednesday, April 29, 2009

The Florida Keys Exclusionary Zoning System Needs to be Declared Unconstitutional

Professor Edward Ziegler, editor of Rathkopf's The Law of Zoning and Planning, has an article in the latest edition of The Urban Lawyer, where he makes the following observations.

Zoning almost by definition is exclusionary in nature, and this is, and has been, true even in many of America's major cities. .... Our regional problem today is that the strong arm of NIMBYism has turned the gentility of old "snob zoning" schemes into zoning schemes that perhaps can best be described as "hyper exclusion on steroids." ....

Typically, concerns about growth within a local community follow a certain political dynamic. .... NIMBYism at some point begins to dominate both the public's perception of future growth and the politics of the local planning and zoning process.

Eventually, anti-growth sentiment develops to the point where nearly everyone but the realtors' lobby has been turned into a BANANA (Build Absolutely Nothing Anywhere Near Anybody). Land use "activists" and civic-minded neighborhood organizations now emerge with the goal of promoting growth management and the "public interest" (often under the banners of "environmental protection" and "fighting urban sprawl") and pressure the city to enact increasingly intensive and burdensome zoning and growth management programs.
Sound familiar? Well, it should. Looking back over the past 25 years, we can see Professor Ziegler's "growth management nightmare" develop in the Florida Keys just as he described it. Since the early 1980's, Monroe County's elected officials have bent over backwards to play the BANANAs and NIMBYites games. First came massive downzonings in 1986, when thousands of platted subdivision lots were stripped of any right to build anything, and a 1-year moratorium was imposed on development on North Key Largo -- that is still in effect today, 22 years after that year ended!

Then, in 1992 the County, led by its since-disgraced top BANANA, Commissioner Jack London, rammed through a "Rate of Development" ordinance -- allegedly based on a hurricane evacuation infrastructure deficiency (US-1 needed to be widened) -- that was supposed to last no more than 10 years, or to 2002. Well, guess who proceeded to oppose all efforts to widen US-1 and build a new bridge over Jewfish Creek. You guessed it, the Monroe County Commission and its bosom buddies, the neighborhood NIMBY associations (who continue to steadfastly oppose anything that would improve hurricane evacuation times).

Professor Ziegler's article doesn't mention how one can remove the obstructive and value-reducing "growth management" plans put into place by the NIMBYs, BANANAs, and their elected lap-dogs. But we can suggest one. Convince a state or federal judge to follow the lead of the Massachusetts Supreme Court in Zuckerman v. Town of Hadley, 813 N.E. 2d 843 (MA 2004), and declare the Rate of Development system unconstitutional.

Tuesday, April 21, 2009

$4,500 Poll Tax Approved by Moron County Commissioners

One wonders what goes through the feeble minds of elected officials, not to mention their sycophantic in-house counsel. Two weeks ago, I noted that the Florida Keys' elected County Commissioners were entertaining their planners' proposed fee of $4,500 for a "Beneficial Use Determination," a/k/a "BUD." Well, they weren't embarrassed in the least. They adopted said $4,500 "poll tax" on April 15, 2009.

In other jurisdictions, similar statutes and ordinances are called "taking avoidance" procedures. Many communities are justifiably concerned that their land development regulations "go too far," placing the local taxpayers in a position where they will have to pony up millions of dollars when regulations go "too far." The more enlightened communities utilize their taking avoidance ordinances to back off on overly confiscatory regulations, and save the taxpayers a ton of money. The Florida Keys $4,500 fee will just cause more litigation. It is now being used to pay planners' salaries, instead of what it was originally intended to do -- save money.

On December 1, 2007, I reported on a good example of municipal incompetence on the part of the City of Half Moon Bay, California, when it got slammed with a $36.8 million inverse condemnation judgment as "payback" for its years of staunch opposition to a residential subdivision within the city limits. Nearly a year later, I reported, also on this blog, that Half Moon Bay and the landowner had reached a settlement. The City would allow the development of the property or, if the California Coastal Commission prevented same, it would pay the landowner $18,000,000.

Monroe County is headed for serious financial trouble, whether the County Commissioners know it or not, and this latest dumb move just digs the hole deeper. Property tax rates in this community are the lowest in the State of Florida, but that will not last long with these clowns in office.

Wednesday, April 15, 2009

Breaking the Back of Unconstitutional Rate-of-Development Ordinances in the Florida Keys

Enacted in 1992 as a "hurricane evacuation infrastructure deficiency" moratorium -- that would expire in 2002 -- every local government in the Florida Keys now has a permanent Rate-of-Development (ROD) ordinance. And those same governments have stalled, and openly opposed, the infrastructure improvements that were going to be completed by 2002. Of course, the got-miners oppose any and all infrastructure improvements, and the local governments gladly appease them. The hurricane evacuation rationale has morphed into a sewer infrastructure deficiency, a save-the-trees program, and an endangered species program, protecting endangered rats, snakes, Playboy bunny, and midget Virginia white-tailed deer (imported in the 1800's as food).

At some point these ROD ordinances must be unconstitutional as violative of Substantive Due Process. Recently, in Zuckerman v. Town of Hadley, 813 N.E. 2d 843 (Mass. 2004), the Massachusetts Supreme Court held that a ROD ordinance -- in effect for 15 years -- was no longer constitutional. Just imagine -- the Town of Hadley had done nothing to cure the "infrastructure deficiency" its ROD ordinance was supposed to alleviate. But it sure reduced development and the got-miners were quite happy.

Sound familiar? Of course. It happens all over the United States, in areas thought to be desirable by the people who live there, as well as those who would like to live there -- and can buy land there but cannot get a building permit. Once someone manages to own their piece of paradise, their highest priority becomes preventing anyone else from doing so.

For an excellent analysis of the problem, see William A. Fischel's "The Homevoter Hypothesis: How Home Values Influence Local Government Taxation, School Finance, and Land Use Policies," Harvard Univ. Press (2001). The author is an economics professor at Dartmouth College, who previously published "Regulatory Takings: Law, Economics, and Politics," Harvard Univ. Press (1995).

Last year we filed two lawsuits challenging Florida Keys' ROD ordinances. The first one, Lightner et al. vs. Monroe County & the State of Florida, involves over 1,200 parcels of land on Big Pine and No Name Keys. The other, Evanoffs vs. the Village of Islamorada, targets that town's ROD ordinances. In the latter, the Circuit Court has agreed that the Complaint states a cause of action, and has asked the parties to schedule a trial at the earliest available opportunity. It would appear that we are on the right track.

Monday, April 6, 2009

If a $2 Poll Tax is Unconstitutional, Can a $4,500 Ripeness Fee be Constitutional?

I understand charging a fee for reviewing building plans -- or to process a Conditional Use or Special Exception -- but charging a $4,500 fee to request Just Compensation? The Monroe County Commission may think this is a terrific idea. Why, just think, a $4,500 "ripeness fee" might just keep a lot of those damn, rabble-rousing landowners from asking for "money" for their regulatory taken property.

On December 31, 2008, Florida's Third District Court of Appeal, once again, explained how the Florida Keys' unusual Beneficial Use Determination (BUD) process works. See Collins, et al. v. Monroe County, et al., 999 So. 2d 709 (Fla. 3rd DCA 2008) and Shands v. City of Marathon, 999 So. 2d 718 (Fla. 3rd DCA 2008). It is also worth noting that the New Jersey Supreme Court just upheld an almost identical BUD in OFP, LLC v. State of New Jersey, 930 A.2d 442 (NJ App 2007), affirmed, 963 A.2d 810 (NJ 2008). (So we are not alone anymore.)

In 1986, the State imposed a confiscatory zoning map on the Florida Keys. It downzoned at least 5,000 platted lots, making them unbuildable. Until First English in 1987, Florida's position was that confiscatory zoning ordinances were unconstitutional on Due Process grounds. See Dade County v National Bulk Carriers, 450 So.2d 213 (Fla. 1984) (Florida did not recognize a right to monetary compensation for regulatory takings by zoning ordinances.) In 1986, the State planning agency was staring at a major Due Process lawsuit that would have taken down its ComPlan in a heartbeat.

In 1985, along came Charles Siemon. He came up with the State's first (and only) "ripening" ordinance. The 1986 BUD gave the County Commission authority to waive any land use regulation that "took" property. The 1986 language was painfully unconstitutional, as it required the landowner to first "attempt" to sell the property for 40% of its pre-regulation Fair Market Value (FMV). If that failed, and the County declined to waive its regulation(s), the County would pay the landowner 40% of the pre-regulation FMV. Judge Richard Payne struck down both provisions in a regulatory taking lawsuit we filed in 1988. The 3rd DCA affirmed. See Monroe County v. Gonzalez, 593 So.2d 1143 (Fla. 3rd DCA 1992).

In 1990, we filed another regulatory taking lawsuit, this time against the City of Key West. See Key West v Berg, 655 So. 2d 196 (Fla. 3rd DCA), rev. denied, 663 So. 2d 629 (Fla. 1995). In 1994, a new Key West ComPlan included a reference to a not-yet-adopted BUD process. Judge Richard Payne agreed Berg did not have to exhaust a not-yet-written regulation, but the 3rd DCA reversed, asking, at oral argument, "why can't you just write the City a letter?" On remand, the City settled with Mr. Berg for $3.5 million.

In 1993, the State of Florida inserted the 1994 Key West BUD language -- which the State also wrote -- into Monroe County's new ComPlan (effective 1977). The County adopted implementing regulations in 1998, and the 1998 BUD ordinance remained in effect until 2008. A new -- but much less constitutional -- BUD ordinance went into effect last year.

The law is clear that a Florida Keys landowner -- who believes their land has been subjected to a regulatory taking -- must petition for a Beneficial Use Determination before his or her taking claim is "ripe." It is equally clear that the Statute of Limitation does not begin to run on a Florida Keys regulatory taking claim until the BUD determination has been rendered. This protects the landowner who is unaware of their claim, and prevents the local government from receiving windfalls when landowners fail to exercise their right to sue for a regulatory taking. It does not protect the government from claims the BUD process has become "futile" on a case-by-case basis.

Last I looked, the right to Just Compensation for a "taking" of property is enshrined in both the U.S. and Florida Constitutions -- just as is the Right to Vote. We don't allow governments to charge a fee for exercising the right to vote -- not a dollar, nor a penny -- even though it costs the government a boatload of money to buy the voting machines, print the ballots, and staff the polling places.

In 1997, Monroe County began charging a $500 fee for processing a BUD petition. Apparently nobody complained, so the fee began to creep up, first to $750, then to $1,300. We filed about 25 petitions the day before the increase to $1,300 went into effect in 2005. Now -- as you can see from the agenda item I posted on Google Docs -- the leeches in the planning department want to increase the fee to $4,490.

For at least the past two years, we have been considering filing a lawsuit to declare the BUD unconstitutional, on several grounds, and to declare the Florida Keys' confiscatory land use regulations unconstitutional on Due Process grounds. What the State and County planners keep forgetting is the holding in Joint Ventures v. Florida DOT, 563 So. 2d 622 (Fla. 1990). In Joint Ventures, the supreme court held a legislative act that precludes all development on a parcel of land, is unconstitutional on Due Process grounds, unless the landowner has a direct avenue to condemnation proceedings. The supreme court specifically stated that the right to bring an inverse condemnation proceeding, as FDOT argued, does not suffice. In the end, the FDOT land-freezing statute was declared unconstitutional on Due Process grounds. (Note the similarity to National Bulk Carriers, above.)

None of the 5 or 6 Florida Keys' BUD ordinances provide affected landowners with a right to a condemnation proceeding. All you get is a letter in the mail that includes an offer to buy the property at a price that is about 15% of what one would receive, on average, in a condemnation proceeding. And -- if you turn down or ignore the offer, the government is content to let you rot in Hell forever. That is not Just Compensation, and it violates Due Process big time.

As they say in the advertising business, watch this space.