Petitioners, residents and nearby occupants (“Petitioners”), commenced a hybrid Article 78 proceeding and declaratory judgment action against the Planning Board of the Village of Tuckahoe (“Board”) and others in Murphy v. Planning Board of Tuckahoe (Sup. Ct. Westchester County 2017), to annul a negative declaration issued by the Board. The Board initially issued a conditional negative declaration (“CND“) for a project to construct a hotel, restaurant and parking lot (“Project”) at a former marble quarry and dump site (“Site”). Petitioners filed suit after the Board amended its CND to a negative declaration.

The Site had been a quarry from the late 1800s until the 1930s, after which private entities and municipalities used the Site for dumping. In 2014, the project’s developer, Bilwin Development Affiliates, LLC (“Developer”), conducted environmental testing which revealed concentrations of volatile organic compounds, semi-volatile organic compounds and inorganic compounds at the Site. The Developer applied for admission into the New York State Brownfield Cleanup Program (“BCP”), which the New York State Department of Environmental Conservation (“DEC”) accepted. During plan preparation for the BCP, the Developer submitted an application to the Board for site plan approval for the Project; and the Board declared itself lead agency for SEQRA review.

In July 2015, after its review, the Board issued a draft conditional negative declaration (“CND”) with time for notice and comment. The Board ultimately adopted the CND in September 2015, categorizing the Project as an unlisted action with the condition that the Developer meet all DEC and Department of Health requirements.

Before and after issuance of the CND, the Developer – in conjunction with the DEC and the Board – performed additional Site investigations and prepared plans for remediation and containment. The final plans for the Project included remediation specifications for the contaminated soil, a community air monitoring plan and construction of a hotel and parking lot as a Site cap. The DEC determined that the remediation plan would eliminate or mitigate all significant threats to public health and the environment presented by contamination.

In October 2016, after a number of public meetings and comments, the Board amended the CND to a negative declaration based upon the DEC’s determination, the remediation plans and other documents in the record. This amendment occurred over a year after the issuance of the draft CND (July 2015). Petitioners sued to annul this decision claiming, among other things, that: (1) SEQRA regulations do not allow the amendment or rescission of a CND unless the lead agency later determines a positive declaration is appropriate; and, (2) the lead agency failed to take a “hard look” at evaluating the environmental impact of the methods to be used in removing contaminated soil and monitoring contaminants. Petitioners also challenged the issuance of the CND.

First, although SEQRA regulations require rescission of a negative declaration or CND if new substantive information or changes cause the lead agency to determine a significant adverse environmental impact may result, the regulations do not prohibit amendments to a CND that remove conditions. 6 NYCRR § 617.7(d)(2), (f)(1). Moreover, SEQRA regulations permit a lead agency, at its discretion, to amend a negative declaration (a CND is a type of negative declaration) at any time prior to the decision to approve an action. 6 NYCRR § 617.7(e). Therefore, the Board was allowed to amend or rescind the CND.

Second, with respect to excavating the contaminants, Petitioners argued that the proposed methods to remediate and monitor were unsafe. Notably, Petitioners did not argue that the proposed methods would have an adverse environmental impact. Petitioners cited their experts’ methods and opinions, which the Board already reviewed during the comment period. The Court held that, at best, Petitioners merely indicated a disagreement between Petitioners’ experts and the Board as to the preferred methods to remediate and monitor – which is not grounds to overturn the Board’s decision to issue the negative declaration.

Lastly, the Court held that Petitioners’ challenge to the underlying CND was untimely. The draft CND was published on July 21, 2015, the period of limitations began to run thirty (30) days later on August 20, 2015, and expired four (4) months later on December 20, 2015. Petitioners could not attack the underlying CND eleven (11) months past the period of limitations by virtue of seeking to annul a later amendment to that CND.

Based upon the foregoing, and other reasons, the Court dismissed these challenges.

In Miranda Holdings v. Town Board of Town of Orchard Park, ____ N.Y.S. 3d, ____, 2017 WL 2884633 (4th Dept. July 7, 2017), Petitioner, Miranda, proposed a commercial structure that included a restaurant with a drive-through window. The Town Board was not happy.  Not only did the Board improperly declare the proposed restaurant with a drive-through as a Type I action under SEQRA, but also it required a full-blown EIS.  Further,  the Town enacted a local law specifically declaring that, going forward, all restaurants with a drive-through would be categorized as Type I actions.

Although the Appellate Division upheld the trial court’s determination that that law does not allow the Town to reclassify actions in a manner that is contrary to the DEC classification, the Court, without any real explanation, remitted the matter back to the Town for further findings consistent with its opinion.

In Miranda’s favor, the Appellate Division upheld the trial court’s decision to invalidate the local law, which reclassified all restaurants with a drive-through as Type I actions wholly inconsistent with the DEC’s Type II designation.

The Town’s Actions

At first, the Town determined that the project was an Unlisted action under the State Environmental Quality Review Act (“SEQRA”) and SEQRA Regulations. See, 6 NYCRR Part 617. The Town issued a “positive declaration” requiring that Miranda prepare an Environmental Impact Statement (“EIS”). A full-blown EIS is difficult, time consuming and expensive. Unsurprisingly, Miranda claimed that the proposed project was a Type II action under the regulations and, therefore, was exempt from all environmental review and from preparing an EIS. In response, the Town passed a resolution making a drive-through restaurant project a Type I action, so that it was presumed to require an EIS. Miranda sued, arguing that the Town (1) was out of bounds, (2) was not allowed to make the project a Type I action because by its nature, it is a Type II action and (3) could not require that Miranda prepare an EIS.

What a mess! The Court’s decision does not add a lot of clarity.

The Trial Court Decision and SEQRA

Like ancient Gaul, all SEQRA actions are divided into three parts – Type I, Type II and Unlisted. A Type I action “carries with it the presumption that it is likely to have a significant adverse impact on the environment and may require an EIS. Type II actions are just the opposite – they are exempt from environmental review under SEQRA and thus not only is an EIS not required, but no review is technically required. “Unlisted” actions are everything that is neither Type I nor Type II, thus allowing latitude in what additional review is necessary.

Most Type I and Type II projects are defined in the NY Dept. of Environmental Conservation (“DEC”) Regulations. For example, all permits and variances regarding single-family homes are Type II actions. However, municipalities may also adopt their own lists of Type I and Type II actions, so long as they do not conflict with the DEC’s lists. In particular, a municipality “may not designate as Type I any action identified as a Type II” in the DEC Regulations.

One of the actions identified as a Type II under the DEC Regulations is a commercial facility (or extension) of up to 4,000 sq. ft., which otherwise meets zoning, such as use restrictions, setbacks or height limits. When the Town initially determined that the proposed drive-through restaurant was “Unlisted,” the developer argued that this 4000-sq. ft. commercial facility provision made the project a defacto Type II action exempt from SEQRA. The Town’s reaction in passing the local law was to make all drive-through facilities into Type I actions – spurring the developer’s lawsuit, claiming that the Town could not convert a Type II action into a Type I action.

The trial court decided in Miranda’s favor, holding that because a drive-through facility was a Type II action under SEQRA, the Town could not automatically make it a Type I action.

The Court acknowledged that the Regulations do not specifically list drive-through facilities as Type II actions. However, the SEQRA Handbook published by the DEC does mention fast food facilities as being within the contemplation of the 4,000 sq. ft. Type II and also gives as an example of a Type II, the expansion of a commercial restaurant where the project is less than 4,000 sq. ft. The Court also noted that the Final Generic Environmental Impact Study prepared by DEC in connection with the 1995 adoption of proposed amendments to the Regulations – including the 4,000 sq. ft. commercial project as a Type II – directly referenced a “drive-through window” as part of the commercial expansion that would be exempted if the 4,000 sq. ft. limitation were met. Therefore, the Court concluded that the DEC “contemplated restaurants with drive-through windows as Type II actions.”

The Appellate Division Determination

However – and here is the mystery – the Appellate Division held that the Supreme Court should not have found that the proposed restaurant was a “4,000 sq. ft.” Type II – without “a revised review” by the Town. What is there to review?

The Appellate Division may have had some empathy with the Town’s concerns and afforded it the opportunity to look more closely at the proposed project. More fundamentally, the “4,000 sq. ft.” Type II is very broad and can easily include projects that pose potential for significant impacts, like traffic and air quality. Despite the fact that the DEC determined that projects of this limited size “do not rise to the level of significance envisioned by [SEQRA] as requiring an EIS,” perhaps other aspects of the proposed development needed further review by the Town.

What the Appellate Division did unequivocally declare is that a municipality cannot reclassify a project from a Type II to a Type I, as this is prohibited under SEQRA.  Invalidation of the local law was upheld.

The bottom line lesson is that municipalities should address planning and zoning concerns for their ordinary development through zoning and planning; not by a short cut in trying to stretch environmental review beyond the DEC regulations specific to each project.

 

seqraThe New York State Department of Environmental Conservation (“NYSDEC”) proposed significant changes to the State Environmental Quality Review Act (“SEQRA”) regulations almost 5 years ago. The NYSDEC recently indicated that these proposed regulations finally will be enacted this year. The proposed regulations will streamline the SEQRA process. This post discusses changes to Type II actions under the proposed regulations.

Type II Projects

Type II actions do not require SEQRA review. The proposed regulations will add over a dozen different specific actions to this category. Some of the more interesting additions to Type II actions include:

  • In cities, towns, or villages with adopted zoning laws or ordinances, reuse of a commercial or residential structure not requiring a change in zoning or a use variance, unless it meets or exceeds certain specified thresholds.
  • In cities, towns, and villages with adopted subdivision regulations, a “minor” subdivision that does not involve construction of new roads, water, or sewer infrastructure and is not part of a larger tract subdivided within the previous 12 months.
  • A recommendation of a county or regional planning board issued pursuant to General Municipal Law §§ 239-m or 239-n.
  • Replacement, rehabilitation, or reconstruction of a structure or facility on the same site, including upgrading buildings to meet energy codes or to incorporate green building infrastructure techniques, within certain specified thresholds.
  • Installation of up to five megawatts of solar energy arrays on certain existing structures, including landfills, brownfield cleanup sites, and residential and commercial parking facilities.
  • Installation of cellular antennas or repeaters on certain existing structures.
  • Installation of fiber-optic or other broadband cable technology in existing highway or utility rights-of-way.
  • Specified brownfields clean-up agreements.
  • Acquisition, sale, lease, annexation, or transfer of any ownership of land to undertake any activity on the new list of Type II actions.
  • Disposition by a municipal or state agency of land, by auction, where there is no discretion on its part on the outcome, such as when a municipality or a state agency acquires land through foreclosure and is required to dispose of the site through a public auction to the highest qualified bidder.      

Conclusion

The NYSDEC is accepting comments on the proposed regulations until May 19, 2017 and intends to enact them in the Fall.

We recently came across an interesting decision from a federal appeals court involving a town’s rescission of a 25-year-old negative declaration issued under the New York State Environmental Quality Review Act (SEQRA).  A “negative declaration” is a written determination by a lead agency that a proposed action will not result in significant adverse environmental impacts. Because of the convoluted history of the matter as it wound its way through both state and federal courts, we think you may find it interesting as well.

In Leonard, et al, v. Planning Board of the Town of Union Vale, __F.3d __ (2d Cir. September 2, 2016), the Second Circuit Court of Appeals ruled that the 2012 rescission of a 1987 negative declaration was not a final determination, requiring the applicant to complete the SEQRA review process before resorting to court.    Here’s the history.

The Planning Board Decision

In 1986, plaintiffs applied to have their 950-acre property, located in the Town of Union Vale in Dutchess County, designated as an “open development area” under Town Law § 280-a(4).  Town of Union ValeThe application was granted by the Town, which permitted the site to be subdivided into private lots with private roads.  In 1987, the Planning Board of the Town of Union Vale (Planning Board) issued a negative declaration with respect to the entire project.   The first section of the project was approved in 1987 and was developed with large single-family homes.  In 2009, plaintiffs applied for a subdivision of the next section.  Changes to the layout required by the Planning Board for this second phase would cause significantly more ground being disturbed than was initially planned.  In 2012, the Planning Board determined that the application was incomplete and decided a new SEQRA review was required because the 1987 negative declaration did not apply to the current application.

Plaintiffs Challenge The Planning Board’s Determination

Plaintiffs sued the Planning Board in state court in 2012, challenging the incompleteness determination. The state trial and appellate courts determined that the 2012 Planning Board incompleteness resolution was improper and annulled it. The courts further ruled that the Planning Board must consider the 2012 application on the basis of the 1987 negative declaration unless the Planning Board determines that the 1987 negative declaration should be amended or rescinded.  The Planning Board held a public hearing in June 2013.  It thereafter adopted a resolution rescinding the 1987 negative declaration on the grounds that the project, and the applicable regulations, had undergone substantial changes since 1987; and the project may result in significant adverse environmental impacts.  According to plaintiffs, no specifics about any such impacts were contained in the resolution.

Not surprisingly, plaintiffs sued again. In 2013, plaintiffs commenced another action in state court, alleging federal due process violations and state law violations. The defendants removed the case to the federal district court, which remanded the state claims back to the state court and dismissed the federal due process claims on the grounds that plaintiffs did not have a property right in the negative declaration. See Leonard et al., v. The Planning Board of the Town of Union Vale, 154 F.Supp.3d 59, 67-68 (SDNY 2016).

Plaintiffs appealed the federal district court’s dismissal of the federal due process claims.  Following the United States Supreme Court ruling in Williamson County Regional Planning Commission v. Hamilton Bank of Johnson City,  473 US 172 (1985), and the Second Circuit’s prior rulings  in Southview Associates,  Ltd., v. Bongartz, 980 F.2d 84 (2d Cir. 1992) and Kurtz v. Verizon New York, Inc., 758 F.3d 506 (2d Cir. 2014), the Second Circuit ruled that before plaintiffs can bring a federal due process challenge to a local land-use claim, the local agency must render a “final decision.”

The Second Circuit found the negative declaration rescission was not a final decision because plaintiffs’ application was still pending before the Planning Board, and the Town still needed to complete the project’s SEQRA review.  The Second Circuit noted that in rare exceptional cases, the finality requirement can be excused.  This requires a showing that the Planning Board already made up its mind and that further proceedings before the Planning Board were futile or that the board used unfair tactics to delay the approval process.  In this case, the Second Circuit found these futility criteria missing.  It also noted that the mere fact that plaintiffs would incur expenses to go through the SEQRA process was not a basis for finding futility.    See Leonard, et al, v. Planning Board of the Town of Union Vale, __F.3d __ (2d Cir. September 2, 2016).

In October 2015, the state court dismissed the remanded state claims, finding that the Planning Board’s rescission was not arbitrary or capricious and did not violate law. That decision is on appeal to the state appellate court.

The Outcome

Plaintiffs incurred a lot of legal fees and spent more than three years challenging the 2012 rescission in both federal and state courts and wound up back where they started – before the Planning Board going through the SEQRA process.

Canoe Place Inn, Hampton Bays
Canoe Place Inn, Hampton Bays, photo credit: www.27east.com

The Town of Southampton re-zoned three properties located in Hampton Bays adjacent or close to the Shinnecock Canal by amending the Town’s Zoning Code to add section 330-248(V), creating the Canoe Place Inn, Canal and Eastern District Maritime Planned Development District. This local law, adopted on January 13, 2015, provides for the rehabilitation of the Canoe Place Inn for use as an inn, catering facility, and restaurant. The law also provides for the development of a 37-unit luxury, waterfront town-house community and associated wastewater treatment facility on the Shinnecock Canal.   Four individual property owners/taxpayers formed an unincorporated community group called Shinnecock Neighbors to oppose the zoning changes and to challenge the local law via a hybrid Article 78 proceeding and declaratory action. In the case, entitled Shinnecock Neighbors, et al. v. Town of Southampton, R Squared Development LLC et al., 3 NYS3d 679 [Sup. Ct. Suffolk Co. 2016], the Shinnecock Neighbors allege, in part, that the local law should be deemed null and void because the Town Board failed to comply with the New York State Environmental Quality Review Act (“SEQRA”) and take the requisite hard look at the potential environmental impacts of the proposed development. Several of the respondents moved to dismiss the petition and complaint on the grounds that the petitioners lacked standing. In an order dated August 30, 2016, the Hon. William B. Rebolini, Justice of the Supreme Court, Suffolk County, dismissed the motion and held that the four petitioners and their unincorporated community group, Shinnecock Neighbors, had the requisite standing to bring the proceeding/action.

As noted in the decision, in order to establish standing in a land use matter, a party “must suffer direct harm (i.e., injury-in-fact) that is in some way different from that of the public at large and, further, that the claimed harm is within the zone of interests protected by the statute or statutes alleged to have been violated.” Shinnecock Neighbors v. Town of Southampton, 3 NYS3d at 683. An organization or association such as Shinnecock Neighbors has standing when one or more of its members has standing to sue, the association demonstrates that the interests it asserts are germane to its purpose, and it is evident that neither the asserted claim nor relief requires the participation of its individual members. (See Society of the Plastics Industry, Inc. v. County of Suffolk, 77 NY2d 761, 570 NYS2d 778 [1991]; Matter of Dental Society of State of NY v. Carey, 61 NY2d 330, 474 NYS2d 262 [1984]).

Three of the four individual petitioners owned residential properties within 500 feet of the proposed wastewater treatment facility. As a result, the Court found that these three individuals had standing and stated, “[a]s it is alleged that each of them resides in close proximity to the proposed development, there arises a presumption that each will be adversely affected in a manner different from the public at large.” Shinnecock Neighbors v. Town of Southampton, 3 NYS3d at 684. Additionally, the Court found that their allegations of harm, including increased traffic, increased noise and air pollution, and degradation of the community from the proximity of the wastewater treatment facility were within the zone of interests protected by SEQRA and the Town’s zoning code. Id. at 684.

Interestingly, the fourth individually-named petitioner asserted a different rationale for standing. Although this petitioner lived about one mile from the canal and was not within the zone of interests protected by the statute, she claimed to be an environmental activist, professional artist and “art activist” who required access to the canal as it was a significant source of her creative inspiration and that the proposed development would have a profound negative effect on her work. The Court found that this fourth petitioner had standing and stated: “…her use and enjoyment of the area is more intense than that of the general public and, therefore, that she may be directly harmed in a way different in kind and degree from others…like claims of specific environmental injury, injury to a petitioner’s aesthetic and environmental well-being, activities, pastimes or desire to use and observe natural resources may also be found to state cognizable interests for purposes of standing.” Id. at 684. As each of the four petitioners had standing, the Court determined that the Shinnecock Neighbors also had the requisite standing. The underlying proceeding/action is still pending before the Court.

Back on September 6, 2016, this blog commented on the case of Matter of Long Island Pine Barrens Society, Inc. v Central Pine Barrens Joint Planning & Policy Commission, 138 AD3d 996 [2d Dept 2016]. In that case, none of the individual petitioners lived within the zone of interests. Nevertheless, the Appellate Division found that the Society had standing because one of the petitioners, the Society’s Executive Director, used and enjoyed the Pine Barrens to a greater degree than most members of the public. Thus, based on the holdings in the Shinnecock Neighbors v. Town of Southampton and Matter of Long Island Pine Barrens Society, Inc. v Central Pine Barrens Joint Planning & Policy Commission cases, an organization may have standing even though all its members reside outside the zone of protected interests if at least one member can articulate a rationale that shows he or she has an interest that is different from the general public, and that interest may be adversely impacted by the proposed action.

 

In prior posts, we discussed sand mining in Southampton, Pine Barrens Credits and the State Environmental Quality Review Act (“SEQRA”). A recent case out of Suffolk County touches on all three areas, so we decided to write a blog post on it.

pbmap_article_slideshow_03The case, Matter of the Application of the Long Island Pine Barrens Society, et al. v. The Central Pine Barrens Joint Planning & Policy Commission and Westhampton Property Associates, Inc., 2014 NY Slip Opinion 30560(U)(Supreme Court, Suffolk County, February 27, 2014), affirmed, 138 AD3d 996 (2d Dept. 2016), involved the granting of an “extraordinary hardship” exemption by the Pine Barrens Commission to Westhampton Property Associates, (“WPA”). WPA wanted to expand its 111-acre sand mine partially located in the Core Preservation Area (68.07 acres) and partially located in the Compatible Growth Area (46.93 acres). The sand mine had been operating prior to 1981, and mining activities occurred at parts of the site since 1957.

The sand mine held permits from the New York State Department of Environmental Conservation (NYSDEC), which limited the depth of the mine to 45 feet above sea level. The mine was approaching this limit and wanted to be able to dig down to 26 feet above sea level. The proposed depth would be about six feet above the groundwater table. This change in depth is considered an expansion of the pre-existing mining use and is therefore considered new development under the Pine Barrens Comprehensive Land Use Plan. Therefore, in addition to obtaining a permit modification from the NYSDEC, WPA was required to obtain approval from the Pine Barrens Commission because it was partially located in the Core Preservation Area. In order to obtain this approval, WPA needed to demonstrate that it was entitled to an “extraordinary hardship” exemption under the Long Island Maritime Reserve Act of 1993 (the “Pine Barrens Act”), codified at Environmental Conservation Law (“ECL”) 57-0101 et seq.

Establishing An Extraordinary Hardship Exemption

ECL 57-0121(10) sets forth the criteria that an applicant must show to establish an “extraordinary hardship” exemption. The applicant must demonstrate that “the particular physical surroundings, shape or topographical conditions of the specific property involved would result in an extraordinary hardship, as distinguished from a mere inconvenience…” This requires providing evidence “that the subject property does not have any beneficial use if used for its present use…and that this inability to have a beneficial use results from unique circumstances peculiar to the subject property which: (i) Do not apply to or affect other property in the immediate vicinity; (ii) Relate to or arise out of the characteristics of the subject property rather than the personal situation of the applicant; or (iii) Are not the result of any action or inaction by the applicant or the owner or his or her predecessors in title including any transfer of contiguous lands which were in common ownership on or after June 1, 1993.”

The Pine Barrens Commission’s Review Of WPA’s Application For An Exemption

WPA submitted its application to extend the depth of its mining operations to the Pine Barrens Commission in November 2011. It also provided for a conservation easement that would preserve the property as open space after the mine was ultimately closed and restoration activities were completed. The Pine Barrens Commission first requested lead agency status to conduct the SEQRA review, which would be coordinated with the NYSDEC and other interested municipal agencies. The Commission also prepared a draft report in January 2012, in which it analyzed all potential environmental impacts and applied the “extraordinary hardship” criteria to the application. This was followed by a series of three public hearings. After considering all of the documentary evidence and the testimony at the hearings, the Pine Barrens Commission issued a negative declaration in October 2012, and adopted a resolution granting WPA the “extraordinary hardship” exemption.

The Pine Barrens Society Challenges The Exemption

The Pine Barrens Society commenced an Article 78 proceeding to challenge the decision of the Pine Barrens Commission. The trial court rejected the Society’s arguments and dismissed the petition. The Court first looked at whether the Pine Barrens Society, its Executive Director and two members of its Board of Directors had standing to bring the proceeding. The trial court found that none of the individual petitioners had standing because none of them alleged they lived in close proximity to the project and their claims of injury were general in nature. One individual claimed to be a teacher who used the Pine Barrens to help educate and was also an avid hiker. The Executive Director claimed he visited the Pine Barrens often and used them to teach and motivate the public about drinking water protection. The trial court then determined that since none of the members of the Pine Barrens Society had standing, the organization lacked standing. Although the finding of lack of standing was itself grounds for dismissal, the trial court went on to determine the case on the merits. It found that the Pine Barrens Commission gave the application the “hard look” required by SEQRA and that its determination was not arbitrary and capricious.

The Pine Barrens Society appealed the decision to the Appellate Division. The appellate court disagreed with the trial court and found that the Pine Barrens Society and its Executive Director had standing. The appellate court noted the Executive Director used and enjoyed the Pine Barrens to a greater degree than most members of the public and the threatened injury of development in the Core Preservation Area was in the zone of interest covered by the Pine Barrens Act. The appellate court also found that the Pine Barrens Society had standing since a member had standing and  the interests it raised in the action were germane to its purposes. The ruling finding standing, however, was a pyrrhic victory as the appellate court agreed with the trial court on the merits.

 The appellate court found that the Pine Barrens Commission’s decision to grant the “extraordinary hardship” exemption was not arbitrary, capricious or an abuse of discretion. The appellate court found that the decision was consistent with the purpose of the Pine Barrens Act, that it would not result in substantial impairment of resources in the Core Preservation Area, and the circumstances were peculiar to the site and was not self-created or due to action or inaction of the property owner. 

 

welcome_bayville_signIn a determination dated June 30, 2016, the Honorable Jerome C. Murphy, Supreme Court, Nassau County, annulled and vacated the Village of Bayville’s local laws amending its zoning code based on the Village’s failure to comply with the New York State Environmental Quality Review Act (“SEQRA”).  See Save Bayville Now, Inc., v Incorporated Village of Bayville.  The challenged local laws, adopted on June 22, 2015, authorized the occupancy of ground floor units with residential apartments in business districts, reduced the required setback from 250 feet to 50 feet for the distance that a combined business/residential use could be from a residentially-zoned parcel and defined a “residential building” as containing five units or more. Previously, residential apartments in this zoning district were only permitted on the second floor, and this type of combined business/residential use was not permitted within 250 feet of residentially-zoned property.

Petitioner, a civic association with at least two of its members residing within 100 and 150 feet of the business district, challenged the adoption of the local laws pursuant to SEQRA. The Court first explained standing in zoning cases. Relying on Matter of Sun-Brite Car Wash v Board of Zoning and Appeals of Town of N. Hempstead, 69 NY2d 406 [1987], which held that “standing principles, which are in the end matters of policy, should not be heavy-handed; in zoning litigation in particular, it is desirable that land use disputes be resolved on their own merits rather than by preclusive, restrictive standing rules.” The Bayville Court first determined that Petitioner had the requisite standing to bring the proceeding, and then went on to determine that SEQRA had not been complied with by the Village when it enacted the local laws.

The Court noted that SEQRA requires local governments to consider environmental impacts of the adoption of local laws by identifying the environmental impacts reasonably anticipated from the proposed action, taking a “hard look” at those areas of environmental concern and providing a reasoned elaboration in connection with the basis of its determination. The civic association alleged that the Village failed to sufficiently review potential impacts from the zoning amendments including traffic and parking issues, septic issues, flooding and flood plain issues, population concentration and the impact on the value of surrounding properties. The Village adopted a negative declaration in connection with the adopted local laws and determined that it would conduct specific SEQRA review in the future upon the application of specific sites within the district. Petitioner argued that this constituted segmentation of the SEQRA process and was unlawful. Segmentation is defined as the “division of the environmental review of an action such that various activities or stages are addressed under this Part as though they were independent, unrelated activities, needing individual determinations of significance.” 6 NYCRR Part 617.2(ag). SEQRA states the following with regard to segmentation:

Considering only a part or segment of an action is contrary to the intent of SEQRA. If a lead agency believes that circumstances warrant a segmented review, it must clearly state in its determination of significance, and any subsequent EIS, the supporting reasons and must demonstrate that such review is clearly no less protective of the environment. Related action should be identified and discussed to the fullest extent possible. 6 NYCRR Part 617.3(g)(1). Id.

The Court determined that the Village acknowledged the potential for “environmental damage” but failed to prepare an Environmental Impact Statement (“EIS”). An EIS provides “a means for agencies, project sponsors, and the public to systematically consider significant adverse environmental impacts, alternatives and mitigation.” 6 NYCRR Part 617.2(n). An EIS is required when the lead agency (in this case the Village) determines that “the action may include the potential for at least one significant adverse environmental impact.” 6 NYCRR Part 617.7(a)(1) (emphasis added). As a result, the Court found that “the Village’s deferred consideration of recognized potential environmental damage” rendered the Village’s adoption of the local laws amending the zoning ordinance “arbitrary, capricious, and not undertaken with regard to the applicable provisions of SEQRA.” The Court annulled and vacated the local laws.

Although not cited by the Court, it bears reminding that courts have long determined the threshold for requiring an EIS is low. See, H.O.M.E.S. v New York State Urban Dev. Corp., 69 AD2d 222, 232 [4th Dept. 1979]; Barrett v Dutchess County Legislature, 38 AD3d 651[2d Dept. 2007].) Therefore, once the Village identified “environmental damage” in connection with the proposed local laws, the preparation of an EIS was required pursuant to SEQRA.

This ruling is consistent with other recent SEQRA segmentation cases involving the adoption of local laws. In Citizens Concerned for Harlem Valley Environment v Town Board of Town of Amenia, 264 AD2d 394 [2d Dept. 1999], leave to appeal denied, 94 NY2d 759 [2000], local laws rezoning property were annulled based upon segmented SEQRA review. In that case, the appellate court determined that “the rezoning at issue was an integral part of a mining proposal that would have obvious potential environmental impacts. The Town Board was obligated to consider these environmental concerns at the time of the rezoning and it failed to do so.” See also, Scenic Hudson, Inc. v Town of Fishkill Town Bd., 258 AD2d 654 [2d Dept. 1999].

iStock_000075777829_Large_BW

A recent ruling by the New York Court of Appeals strictly limits a developer’s right to appeal a positive declaration under the State Environmental Quality Review Act (“SEQRA”).  A “positive declaration” triggers the need for a draft environmental impact statement (“DEIS”) because there is a finding that the project has the potential to result in one or more significant adverse environmental impacts.

On March 31, 2016, the New York Court of Appeals issued its decision in Matter of Ranco Sand and Stone Corp. v. Vecchio2016 N.Y. Slip Op. 02477 (March 31, 2016).  In Ranco, the Court clarified its 2003 ruling in Matter of Gordon v. Rush, 100 N.Y.2d 236 (2003), which permitted an aggrieved developer to immediately challenge a town board’s positive declaration under SEQRA without first having to prepare a DEIS and complete the SEQRA environmental review process.

The Gordon decision caused some confusion among the lower courts, prompting the Court of Appeals to revisit the issue in Ranco and clarify its prior ruling.  As explained in Ranco, a positive declaration cannot be immediately challenged in an Article 78 proceeding unless the developer can establish at least one of the following:

1) that a positive declaration appears to be unauthorized;

2) the agency issuing the positive declaration is unauthorized; or

3) the action is not subject to SEQRA.

The Ranco decision is discussed in greater detail in my May 25, 2016 NYLJ article entitled Court Limits Judicial Review of SEQRA Positive Declaration.

The Ranco Facts

The Ranco case arose after Ranco Sand and Stone Corp. applied to the Smithtown Town Board to rezone, from residential to heavy industrial use, one of two contiguous parcels Ranco owns.  After the Town’s Planning Board and Planning Department recommended approval of the application, the Town Board, acting as lead agency under SEQRA, adopted a resolution issuing a positive declaration that rezoning the parcel “may have a significant effect on the environment”, which required Ranco to prepare a DEIS.  Rather than endure the time and expense of preparing a DEIS – estimated to cost between $75,000 and $150,000 – Ranco promptly commenced an Article 78 proceeding against the Town Board.  Ranco sought to annul the positive declaration as “arbitrary, capricious, and unauthorized” and requested an order directing the Town Board to process the rezoning application without a DEIS.

The Town Board moved to dismiss the petition for failure to state a cause of action.  The Supreme Court, Suffolk County, granted the motion, finding that the matter was not ripe for judicial review.  The Appellate Division, Second Department, affirmed.  It concluded that the positive declaration was the initial step in the decision-making process rather than a final administrative determination and, therefore, did not give rise to a justiciable controversy.  The Court of Appeals granted leave to appeal.

Two Requirements for Judicial Review

In referencing Gordon, the Court found that immediate judicial review of a determination was warranted when two requirements were satisfied:

1)  The town board’s action had to “impose an obligation, deny a right or fix some legal relationship as a consummation of the administrative process.” This threshold requirement consisted of “a pragmatic evaluation . . . of whether the decisionmaker has arrived at a definitive position on the issue that inflicts an actual, concrete injury.”

2) The apparent harm inflicted by the action “may not be prevented or significantly ameliorated by further administrative action or by steps available to the complaining party.”

The Court concluded in Gordon that the Board’s action was ripe for judicial review because both the above requirements were met.  The Town’s positive declaration imposed an obligation on the developer to prepare and submit a DEIS after they had already been through the coordinated review process and a negative declaration had been issued by the DEC as lead agency.  Moreover, it found that further proceedings would not remedy the injury caused by the unnecessary and unauthorized expenditures associated with conducting a DEIS.

In Ranco, the Court agreed that the Town Board’s positive declaration imposed an obligation on Ranco that satisfied the first requirement of the ripeness-for-review analysis.  The Court failed, however, to find that the second requirement was met notwithstanding that the Court acknowledged Ranco could not recoup the costs and time incurred in preparing a DEIS, even if its application is ultimately successful.

In apparent recognition of its seemingly inconsistent application of the two-part test, the Court stated that when a positive declaration appears to be unauthorized, such as when a proposed action is not subject to SEQRA or when an administrative agency is not empowered to serve as lead agency, it might be ripe for judicial review.  The Court concluded that because Ranco did not claim the positive declaration was unauthorized or that the action was not subject to SEQRA, and because it had not presented any other basis to find that the Town Board had acted outside the scope of its authority, its petition for judicial review was denied as being not ripe for judicial review.

In the Ranco decision, the Court of Appeals referenced its ruling in Gordon, wherein it found that a positive declaration was ripe for judicial review when two requirements were satisfied. First, the agency’s action had to “impose an obligation, deny a right or fix some legal relationship as a consummation of the administrative process.” This threshold requirement, the Gordon Court said, consisted of “a pragmatic evaluation . . . of whether the decisionmaker has arrived at a definitive position on the issue that inflicts an actual, concrete injury.”  To satisfy the second requirement, there had to be a finding that the apparent harm inflicted by the action “may not be prevented or significantly ameliorated by further administrative action or by steps available to the complaining party.”

In Gordon, the Court concluded that the Board’s action was ripe for judicial review.  The Town’s SEQRA declaration imposed an obligation on the petitioners to prepare and submit a DEIS after they “had already been through the coordinated review process and a negative declaration had been issued by the DEC as lead agency.”  No apparent further proceedings would remedy the injury caused by the unnecessary and unauthorized expenditures associated with conducting a DEIS.

The Ranco Court Clarifies and Limits its Prior Ruling

The Court in Ranco agreed that the Town Board’s positive declaration imposed an obligation on Ranco that satisfied the first requirement of the ripeness-for-review analysis.  It failed, however, to find that the second requirement was met, despite the fact that the Court acknowledged that Ranco could not recoup the costs incurred and time spent on preparing a DEIS, even if its application is ultimately successful.

In apparent recognition of its seemingly inconsistent decisions and to avoid any further confusion, the Court specifically limited Gordon.  It held that Gordon stands for the proposition that an immediate challenge to a positive declaration may be ripe for judicial review only where the positive declaration appears unauthorized, such as when the administrative agency is not empowered to serve as lead agency or a prior negative declaration obviates the need for a DEIS, or when the proposed action is not subject to SEQRA.  The Ranco Court concluded that because Ranco did not claim the positive declaration was unauthorized or that the action was not subject to SEQRA, and because it had not presented any other basis to find that the Town Board had acted outside the scope of its authority, its petition was deemed not ripe for judicial review.

The Chilling Effects of Ranco

The Ranco decision significantly limits the situations in which an aggrieved party can commence an immediate challenge to the issuance of a positive declaration.  Given the large financial expense and the considerable amount of work and time involved in preparing a DEIS, the Court’s ruling is likely to mean, in many instances, that a positive declaration will be the death knell of a project.

Perhaps more disturbing is the fact that aggrieved developers who believe their projects have been wrongly made the subject of a positive declaration must first pay tens or even hundreds of thousands of dollars for the right to bring an Article 78 challenge and will not have the ability to recoup those costs, even if they ultimately prevail in their claim.

Without any financial accountability for their actions, decision-makers who are critical of a development project can now use a positive declaration to advance an anti-development agenda under the guise that they are merely being diligent stewards of the environment.

downloadIn Matter of Ranco Sand & Stone Corp. v. Vecchio, 124 A.D.3d 73 (2nd Dept. 2014), the Appellate Division, Second Department, recently held that the issuance of a positive declaration under the New York State Environmental Quality Review Act (“SEQRA”) did not constitute a matter ripe for judicial review, but rather was merely a preliminary step in the decision-making process.  This decision appears to conflict with the Court of Appeals’ decision in Matter of Gordon v. Rush, 100 N.Y.2d 236 (2003), which held that a lead agency’s issuance of a positive declaration requiring a property owner to  prepare and submit a draft environmental impact statement (“DEIS”) can immediately be challenged in court as arbitrary or capricious before a final determination on the underlying application is made.

In Rush, the Court ruled that an Article 78 proceeding challenging a lead agency’s issuance of a positive declaration was ripe for judicial consideration because that determination represented the agency’s “definitive position on the issue” that inflicted “an actual, concrete injury.” The Court added that a ripeness determination also required a finding that the apparent harm inflicted by the action could not be “prevented or significantly ameliorated by further administrative action or by steps available to the complaining party.”

Applying this test, the Court of Appeals found that the issuance of a positive declaration was ripe for judicial review because that determination imposed an obligation on the property owner to prepare and submit a DEIS, which was deemed to be an “actual, concrete injury” because the preparation of a DEIS is likely to cause the petitioner to incur “considerable time and expense.”  Moreover, the Court found that this injury could not be prevented or ameliorated by further administrative action.

In Ranco, the Appellate Division made the very same findings, but concluded that neither was determinative.  Instead, the Court highlighted a number of factors that it found distinguished this case from Rush, such as that Ranco had not already been subject to a coordinated SEQRA review process and a negative declaration indicating that a DEIS is not warranted had not previously been issued.  In light of these distinguishing factors, the Court concluded that the issue of whether a positive declaration is a final determination that is ripe for review must be determined on a case-by-case basis.

Despite the Appellate Division’s attempts to distinguish the two cases, the Ranco decision seems to fly in the face of the Court of Appeals’ rationale in Rush.  Moreover, unless the Second Department itself, or the Court of Appeals, ultimately rejects Ranco, it places applicants who believe that the issuance of a positive declaration is unwarranted in the unfortunate position of having to first incur the cost of preparing a DEIS, which can cost $100,000 or more, before they can challenge the positive declaration itself.  The practical effect of Ranco is that due process to challenge certain SEQRA wrongs may now come with a significant price tag.

30b8f7d055a9be9d4bf8c358cf5ed8a8In its recent decision in Troy Sand & Gravel Co., Inc. v. Town of Nassau, 125 A.D.3d 1170, __N.Y.S2d__, 2015 WL 685968 (3d Dept. 2015) the Appellate Division, Third Department held that the Town of Nassau, having zoning authority with respect to a special permit and site plan review over a proposed mining operation could not gather additional information regarding the environmental impacts of a proposed quarry.  The critical facts leading to the Court’s holding were that the New York State Department of Environmental Conservation (“DEC”) had already conducted a complete environmental review pursuant to the State Environmental Quality Review Act (“SEQRA”) in connection with its review of a mining permit for the same applicant, and the Town had participated in the SEQRA review as an “involved agency.”[1]

The Court’s determination in Troy Sand & Gravel Co., Inc. clarifies the language of its earlier decision in 2012 wherein it stated that although the Town is bound by DEC’s SEQRA findings and it may not repeat the SEQRA process, it nevertheless retains the authority to make an independent review of the plaintiff’s application for a special permit in accordance with the criteria and standards set forth in the zoning code.  See, Troy Sand & Gravel Co., Inc. v. Town of Nassau, 101 A.D.3d 1505, 1508, 957 N.Y.S.2d 444 (3d Dept. 2012).  The Town relied upon the 2012 decision to rescind its prior determination that the permit application was complete so that it could consider whether the SEQRA record was adequate to allow for the Town’s own review under the environmental standards of its zoning law and whether additional environmental review was needed.

In the 2015 decision, the Court rejected the Town’s attempt at a second bite at environmental review, holding that any further gathering of information on environmental factors would be outside the existing SEQRA record and that such review would “vitiate the efficiency and coordination goals of SEQRA.”  2015 WL 685968 at *3.  In sum, as an involved agency in the prior SEQRA review conducted by the DEC, the Town must rely on the fully developed SEQRA record, in which the Town had “extensive involvement.”  Id.  And while the Town maintains its jurisdiction over zoning determinations, it must rely on the final environmental impact as its basis for review of environmental impacts, rather than conduct its own further environmental review.

[1] For SEQRA purposes, an involved agency is one that has jurisdiction by law to fund, approve or directly undertake an action.  See, 6 NYCRR 617.2(s).  Normally an agency becomes aware of its involvement when it receives an application or is contacted by another involved agency as part of a coordinated review.  From “The SEQR Handbook: Third Edition,” 2010.