In this post, which is the third and final segment of a three-part series, we look at real property recording and related fees, which have increased significantly in Nassau and Suffolk Counties in recent years. Like illegal impact fees and excessive administrative review fees, fees related to the recording of legal instruments are being used by both Nassau and Suffolk Counties as another revenue-generating measure to help balance their budgets. Since many of these ever-increasing fees appear to have no correlation to the cost of the services being performed to record the documents, they are viewed by many as being tantamount to another unauthorized and illegal tax.

Document Recording Process

Documents that relate to interests in real property in New York, such as deeds, leases, easements, restrictive covenants, mortgages and subdivision plats, are typically recorded in order to provide the public with constructive notice of these interests and to assist in determining ownership rights and other claims. In most cases, these documents are recorded in the county where the property is located and maintained by the county clerk.

Prior to recording, each document is generally proofread to ensure that the important details of the instrument are correct. Each document is then given book and page numbers, or in the case of subdivision plats a map number, which are useful to individuals who want to look up or research the recorded documents. Thereafter, each document is electronically imaged and the original is returned to the party indicated on the document.

Document Recording and Related Fees

The document recording process is an important county clerk function requiring a large staff and equipment that are not without cost. To offset the cost of the document recording process, county clerks typically charge a base fee for the recording service, as well as a per page fee to record a particular document. In recent years, the total cost to record a document has increased dramatically, while the process for doing so has remained largely static.

For instance, a person wishing to record a real estate document in Suffolk County must first now pay a Real Property Tax Service Verification Fee of $200 for each tax lot that the instrument is to be recorded against, plus a $20 handling fee, a $5 per page fee, a $5 Commissioner of Education Fee and a $15 Cultural Education Fund fee. Effective January 1, 2017, persons wishing to record a mortgage in Suffolk County must also pay a $300 Mortgage Verification Fee.

In Nassau County, in order to a record a real estate document, a person must pay a $300 block recording fee, a base recording fee of $40, and a $5 per page fee. In 2009, the block recording fee was just $10. However, within just one year the block recording fee was increased by 1,400% to $150. It doubled again in 2015 to its current amount. In Nassau County these same fees apply to a person who wishes to record a satisfaction of mortgage. In addition to these fees, the Nassau County Department of Assessment implemented a Tax Map Certification requirement in 2015 for all deeds, mortgages, satisfactions, assignments and consolidations. This process requires that each document have its Nassau County Tax Map Number verified with the Department of Assessment before it can be presented for recording in the Clerk’s office. Documents presented without the Department of Assessment certification page cannot be accepted for recording. The charge for this service was originally $75, but within just a few short years was increased by nearly 400% to the current fee of $355 per tax map verification letter (“TMVL”).

According to a Newsday report written at about the same time when the new real estate fees and fee increases went into effect, these fees were estimated to generate $35.6 million in revenue for the County government, but will make Nassau’s closing costs among the highest in the State. These new and increased fees often add thousands of dollars to the cost of buying and selling a property in Nassau County, particularly where a mortgage is involved. And, if there are any errors in the recorded documents that need to be corrected, the County requires payment of recording fee for a second time.

Nassau County Legislator Howard Kopel, a critic of the fee increases, and the only legislator to vote against the increases, argued that they were not justified because fees are supposed to correlate to the County’s cost to provide the service. Some lawmakers who voted in favor of the increases shifted the blame for the increased fees to the Nassau County Interim Finance Authority (NIFA), which allegedly demanded that the County budget include additional revenue.

Since the law does not require a deed or other instrument to be recorded, those who cannot afford the exorbitant recording fees may be forced to forego the recording process altogether. They may also choose not to take action to correct known defects or errors in recorded documents. The failure to record original and corrected documents will compromise the integrity of the county recording systems by making the information they maintain less reliable. This will undoubtedly lead to disputes over property ownership and other interests in real property and cause rightful owners to lose their property interests to bona fide purchasers who did not have constructive notice of the rightful owner’s interest. Thus, the excessive recording fees being charged may actually lead to the very problems that our recording systems are designed to avoid.

Regardless of who is responsible for the increased real estate fees, the steep trajectory of the increases makes it highly unlikely that the recording fees being charged in both Nassau and Suffolk counties are commensurate with the actual cost of recording a document. Moreover, because the recording fees are actually generating revenue in both counties, those who claim such fees are actually an illegal tax appear to be justified in their position.


images7PKZX7LEIn this post, which is the second segment of a three-part series, we will highlight the various ways that local governments facing fiscal challenges have turned to imposing fees related to the administration of their zoning, subdivision and other land development ordinances to generate additional revenue.  Such fees are authorized by law and can be justified on the basis that those who derive the benefit from a land use application should bear the cost to review that application, rather than the taxpayers.  However, many municipalities on Long Island are imposing new administrative review fees, or increasing the amount of existing fees, that require applicants to pay amounts that are not reasonably commensurate with the cost of the services performed.  Excessive administrative review fees are subject to legal challenge as an illegal “back-door tax.”

Administrative Review Fees

A local government, as part of its regulatory authority, may establish fees for the payment of the expenses to administer a regulatory program. Pursuant to such authority, governmental entities typically charge fees in connection with applications associated with land development to recoup the costs involved with the review of said applications and associated plans to insure that the proposed work complies with all applicable laws, ordinances and regulations. However, while municipalities are authorized to impose review fees, the courts have made clear that the fee amount that can be charged is limited to that which is “reasonably necessary” to undertake the regulatory review involved. In applying the “reasonably necessary” principle, courts do not require exact congruence between the fees charged and the government’s cost to review an application; but there must be some rational underpinning for the charges levied. In other words, the review fees charged must be commensurate with the actual expense of the application being processed and should not be exacted for revenue-generating purposes or to offset the cost of general governmental functions.

Nassau County’s GML § 239-f Review Fee

In 2015, the Nassau County Legislature adopted Ordinance No. 176-215, which pertains to fees charged by the Nassau County Department of Public Works (“NCDPW”). According to the ordinance, certain fees charged by Nassau County “no longer cover the costs required to administer and process the services for which they are charged.” Therefore, the ordinance states that it is “necessary to fix such fees so that they cover the administrative costs associated with the operation of services of the departments.”

Among the fees imposed by Ordinance No. 176-215 are those charged to review applications for building permits, pursuant to General Municipal Law (“GML”) § 239-f, that are forwarded from the various town, cities and villages. GML § 239-f grants the NCDPW the authority to review applications for building permits for developments having frontage on a Nassau County road, but only insofar as the proposed building, including curb cuts or other means of access, may be related to the County road. Where the application is for a development with an anticipated construction cost of $25,000 or more, the initial review fee is $1,500. However, if the anticipated cost of construction is greater than $250,000, the developer is required to pay a fee equal to .75% of the estimated construction value in addition to the initial review fee.

While there clearly is authority for the NCDPW to charge reasonable administrative review fees to process building permit applications for developments that front on a County road, these fees are vulnerable to legal challenge because the amount of the fees charged, at least for developments costing $250,000 or more, is not commensurate with the cost of the services performed. Nor do they bear any relationship to the development’s impact on County roads or other facilities. To illustrate this point, the fee charged to review a building permit for a 150,000 square foot membership warehouse store (such as a Sam’s Club, Costco, or BJ’s), which is typically a simple concrete block building with inexpensive fixtures and finishes, is likely to be significantly less than the fee charged for a building of the same size and constructed on the same site for use by a retailer that elects to construct its building with better and more expensive materials, fixtures and finishes. Presumably, both retailers’ uses would have the same impact on the adjacent County roads and facilities, but the retailer whose building will cost more to construct will be required to pay more to have its plans reviewed by NCDPW. Aside from being patently unfair (and perhaps illegal), the NCDPW’s review fee structure encourages developers to construct buildings using inferior, less expensive materials.

NCDPW’s building permit review fees, at least when they are based on the cost of construction, appear to be vulnerable to attack because they are not calculated based on the NCDPW’s cost to review an application, or the impact that a proposed development may have on County facilities. Instead, they are based on the amount of the investment that a developer chooses to make in the site. Moreover, according to the Nassau County Legislature’s Review of the Fiscal Year 2017 Budget & Multi-Year Plan, these fees also appear to be imposed for revenue generating purposes and to offset the cost to operate the NCDPW. Indeed, while the NCDPW revenues have generally decreased since 2015, the County’s current budget projects nearly a 300% increase in revenue from GML § 239-f building permit review in 2017.

To date, the NCDPW’s building permit review fees have not been challenged by developers, who instead simply pay the fees and capitalize them into the land value. However, these increased costs are being passed on to consumers who ultimately pay more for housing, goods and services. While these fees are helping Nassau County balance its budget, they are also contributing to the high cost of living that is driving people away at an alarming rate.

In the next and final segment of this series, we will look at real property recording fees, which have increased significantly in Nassau and Suffolk Counties in recent years. These fees are being used as yet another revenue-generating device that some consider to be nothing more than an illegal tax.


shutterstock_527190727In an effort to generate revenue without raising taxes, many municipalities on Long Island, and elsewhere in New York State, are turning to the use of various forms of land development fees to meet their fiscal challenges. In many cases, these fees can be legally and morally justified, such as when they offset the actual administrative costs of processing a land use application, or when a municipality must incur costs to provide additional public infrastructure and services to accommodate a new development. However, in their zeal to raise revenue, some local governments have ignored statutory and judicial authority that establish a narrow framework for collecting and using these fees, which may leave them exposed to a legal challenge.

In this post, which will be presented in multiple segments, we will highlight the various ways that local governments are using impact, administrative review and recording fees as a revenue-generating measure. We will review the propriety of these fees and discuss the potential impact that these fees can have on development, which is typically a good barometer of a community’s economic prosperity.  We will also discuss who ultimately pays these fees that translate into higher housing and other costs.

Local Impact Fees

Impact fees are one-time payments required by local governments in connection with new developments for the purpose of defraying some of the cost of constructing or improving the public infrastructure needed to serve them. Where authorized, such fees are used to shift the financial burden for additional capital improvements and services from taxpayers to private developers who are the beneficiaries of those improvements and services.

To be valid, there must be a “rational nexus” between the impact fee imposed and the infrastructure needs created by the new development. To satisfy the nexus test, the development must create a need for the new infrastructure; and the fee amount must be based on the extent to which the development benefits from the infrastructure. In other words, an impact fee cannot exceed the pro rata or proportionate share of the anticipated costs of providing the new development with the necessary infrastructure.

Roughly half the states have enacted enabling legislation authorizing the imposition of impact fees. New York, however, is not among them. In fact, a number of decisions by New York Courts cast serious doubt on whether municipalities can enact local impact fee legislation pursuant to home rule powers, or otherwise impose such fees on developers.

In the only impact fee case to reach New York’s highest court, the Court of Appeals in 1989 invalidated the Town of Guilderland’s attempt to fund roadway and other transportation improvements under its Transportation Impact Fee Law (“TIFL”) in Albany Area Builder’s Association v. Town of Guilderland . While the Court did not actually rule on the validity of local impact fees, it concluded that the TIFL was impliedly preempted by the State Legislature’s uniform scheme to regulate highway funding set forth in the Town Law and Highway Law. This decision precludes the use of local impact fees to cover costs associated with roads, sewer, water hook-ups and other infrastructure for which State law already provides a comprehensive regulatory scheme for the financing of these improvements.

Notwithstanding the legal precedents, there are local governments on Long Island that continue to impose what amount to significant, but questionable, impact fees on developers. One such fee is the Town of Brookhaven’s Land Use Intensification Mitigation Fee.  The stated purpose is to mitigate any land use intensification associated with the approval of a change of zoning classification from a more restrictive to a less restrictive use through the acquisition of open space. Depending on the existing and proposed zoning classifications and the size of the site, the law has the potential for imposing significant fees on developers and other landowners within the Town.

While the stated goals of this fee law are undoubtedly laudable, the absence of specific enabling legislation authorizing this fee makes Brookhaven’s law susceptible to legal challenge. A Court could find that the fees charged are not commensurate with the potential demand for additional open space created by the less restrictive zoning and, therefore, fails the “rational nexus” test. A Court may also find that the Town Law provisions authorizing a municipality to require that a parkland be set aside, or impose a fee in lieu of parkland, in connection with site plan and subdivision applications impliedly preempts the Town’s fee law. Of course, it is also possible that a Court could uphold this fee, and Brookhaven’s law may become a model for future local impact fees in New York State.

To date, these fees have not been challenged by developers, who instead are simply paying the fees and capitalize them into the land value. However, depending on the nature of the development, these fees are being passed along by developers to new owners and renters of residential, commercial, industrial, office and retail space, and also to consumers who must ultimately pay more for retail goods and services. While these fees make it easier for a municipality to balance its budget, this short-term benefit pales in comparison to the significant negative impact that these fees can have by driving up the cost of living on Long Island and frustrating the market’s ability to deliver much-needed affordable housing.

In the next segment of this post, we will look at administrative review fees, which are another revenue-generating device used by local governments related to the processing of land use applications that are being assessed on developers, often without regard to the legal limitations on such fees.

In 2018, the Federal Communications Commission (“FCC”) issued an Order governing the installation of small cell nodes and other telecommunications facilities in an effort to speed up the deployment of the newest generation of wireless technology known as 5G.  A small cell node typically consists of a single small antenna and related accessory equipment placed on existing utility poles or street lights within public rights-of-way.  The FCC Order was intended to remove state and local government barriers to 5G deployment by, among other things, providing providers with easier access to existing infrastructure in public rights-of-way.  It also limits the amount of fees that can be imposed for use of public rights-of-way and requires municipalities to adhere to the shorter timelines or “shot clocks” for the processing of applications.  However, the Order preserves a local community’s ability to manage and protect local land-use interests by allowing objective and reasonable aesthetic regulations that are no more burdensome than those applied to other types of infrastructure deployments.

While some municipalities have laws that regulate telecommunications facilities, most apply only to antenna towers and other macro cell sites – not small cells. As service providers seek to install the small cells needed to support their new 5G networks, local governments are reacting by adopting new laws to regulate small cells.  Several Long Island communities recently enacted legislation seeking to regulate small cells and related wireless telecommunications equipment in public rights-of-way to the maximum extent permitted by law.  The Town of Huntington is among the latest communities to do so.

In March 2021, the Huntington Town Board adopted Local Law No. 15 of 2021, upon a determination that it was in the best interests of town residents to establish standards for the location of wireless telecommunications facilities that are consistent with the latest federal and state laws, statutes, rules and regulations in order to protect the health, safety and welfare of the Town.  The new law recognizes that it is in the best interests of residents to provide them with access to wireless telecommunications technologies, while at the same time protecting natural features, aesthetics and the character of residential neighborhoods.

The law creates standards for the design of telecommunications facilities and a priority list for their placement.  The highest preference is given to facilities placed on existing towers and structures on municipal properties and facilities, and in public rights-of-way adjacent to commercially- and industrially-zoned areas.  The next highest preference is given to existing privately-owned structures on commercially- and industrially-zoned properties, and then to existing privately-owned structures on residentially-zoned properties.  Facilities located in public rights-of-way adjacent to residentially-zoned areas are less desirable, with facilities located on new towers in residential areas being the least desirable.  To minimize the number of new facilities, the law also mandates collocation of equipment whenever possible.  It requires an applicant to demonstrate that no suitable existing structures or facilities are available for collocation within the same geographic area as the proposed facility.

In an effort to mitigate the visual impact that telecommunications facilities can have on surrounding areas, the Town’s new telecommunications law requires that all facilities adhere to certain general aesthetic requirements.  For instance, all new facilities, including supporting electrical and mechanical components, must be of a neutral color or such other color as the reviewing board may require.  They must be constructed, to the extent practicable, using materials, colors, and textures, so that they blend into the natural setting and surrounding buildings.  Any ground-mounted equipment must screened with a suitable fence and/or landscaping to maintain the aesthetic quality of the surrounding community.

The law also contains requirements that are specific to small cell nodes that are to be placed on utility poles located in, or within 100 feet of, a residential zoning district to minimize their visual and noise impacts on the surrounding area.  All equipment attached to utility poles, must be painted a solid, flat color to match the color of the pole.  In the event there is no existing utility pole or alternative structure in the area, the applicant must install the equipment within a stealth pole.  A stealth pole is a structure that allows all antennas and related equipment to be fully contained so that they are not visible.

Areas within the Town that are designated as “Hamlet Centers” and “Sensitive Locations” also have specific locational aesthetic requirements.   For instance, in Hamlet Centers, the law requires that all facilities be constructed and installed on either an existing tower or the rooftop of a commercial building setback so that they are not visible from street level.  Moreover, whenever technologically feasible, the facilities must be placed within existing architectural features, such as steeples, cupolas, bell towers or similar structures.  Where equipment is proposed to be installed in or adjacent to a Sensitive Location, the reviewing board may direct that it be installed within a stealth pole.

Huntington’s new law is not limited to the regulation of small cell nodes.  It also updates and replaces the Town’s previous telecommunications law that focused on the regulation of conventional towers and other macro sites.

As wireless service providers seek to rapidly expand their 5G networks, unduly burdensome regulations that interfere with their ability to provide upgraded technologies are likely to be met with legal challenges.  With limited application to date, only time will tell whether Huntington’s new law complies with the FCC Order.  Many Long Island communities will be watching closely to see how the local telecommunications industry reacts to the law.

This blog post provides an update to a post that was published on November 30, 2020, regarding a dispute over the Town of Oyster Bay’s recently adopted rules governing conduct at public meetings.  The new procedures, which created rules of decorum and prohibited inappropriate and disruptive behavior during public meetings, were challenged by Kevin McKenna, a town resident and self-described “citizen advocate” in an action brought in Federal court.

The dispute now appears to be resolved. On December 21, 2020, U.S. District Court Judge Gary Brown dismissed the case after he was informed by lawyers for Mr. McKenna and the Town that the parties had reached a settlement in principle, and that the Town Board would consider a draft of amended rules at a Town Board meeting to be held in January.

Earlier this week, at the Town Board’s January 12, 2021, meeting, the Board voted to amend its public meeting rules.  The amended rules remove the language prohibiting speakers from making political statements or using language deemed offensive, insolent or slanderous.  The new language states that speakers and members of the public “shall not disrupt, delay, or otherwise impeded the orderly conduct of the proceedings by defaming, intimidating, making personal insults, making threats of violence or threats against public order and security.”  Signs and banners may be displayed at public meetings, provided they do not contain obscene language, obstruct the view of other attendees or otherwise interfere with the meeting.

In recognition of the doubt expressed by Nassau County District Attorney Madeline Singas that violations of the Town’s vague and subjective rules of decorum would lead to prosecution for disorderly conduct under Penal Code, Section 240.20, the amended rules remove all references to disorderly conduct prosecutions.  Instead, if an individual violates the Town’s rules of decorum, the presiding officer will issue a verbal warning to that person.  If the violations continue, all comment or debate shall end and the individual will be asked to leave the meeting room, and if they refuse, will be directed to leave the room.  If the individual still refuses to leave, the presiding officer may seek the assistance of law enforcement to remove the disruptive individual.

A recent Newsday article reports that the settlement also requires the Town to make a $15,000 payment to Mr. McKenna to cover his legal fees.

The Appellate Division, Second Department, issued a decision on October 10, 2018, which rejected a town’s attempt to saddle an applicant with over $17,000 in consulting fees supposedly incurred by the town in reviewing special use permit and area variance applications for an antenna tower to be used by an amateur radio (a/k/a ham radio) hobbyist. The installation of the tower was expected to cost less than $1,000.

In Matter of Landstein v. Town of LaGrange, Myles Landstein, the owner of residential property located in the Town of LaGrange (“Town”) in Dutchess County, sought the special use permit and area variance to install a 100-foot antenna tower on his property for his personal use in connection with his ham radio station. The Town Code limits towers to 35 feet in height.

Mr. Landstein had already obtained a license for his ham radio station from the Federal Communications Commission (“FCC”). After receiving the FCC license, Mr. Landstein applied to the Town and paid the $250 filing fee. Although the applications clearly indicated that all costs incurred by the Town for the review of the applications were the sole responsibility of the applicant, Mr. Landstein added a comment to the application requesting that he be advised in advance of the review cost amount.

The applicant indicated that the 100-foot tower, which would be 18-inches by 18-inches in dimension, was needed to operate the ham radio station effectively and would be barely visible above the tree line. Town residents objected, contending the tower would be an eyesore and interfere with cellular and internet service.

The applications were discussed at 14 separate public meetings over the course of 2 years. The applicant even agreed to decrease the height of the tower to 70 feet. However, he would not agree to pay the ever-increasing legal fees that the Town sought to recover from him, which at one point exceeded $17,000. Mr. Landstein’s attorney wrote to the Town complaining that the fees were excessive in light of tower’s modest installation cost and violated an FCC regulation. Thereafter, the Town Board passed a resolution indicating that it would review and audit its consultant costs to determine if they were “reasonable and necessary.”

The audit revealed that the town attorney’s charges were not solely attributed to the specific area variance application before the Town Zoning Board of Appeals (“ZBA”) but were more generic. They included charges for: (1) attendance at the ZBA hearings, (2) travel time, (3) telephone calls with ZBA members, (4) internal conferences at the town attorney’s law firm, (5) drafting the ZBA agendas, (6) reviewing the applicant’s files, and (7) legal research. Upon completion of the audit, the Town Board passed a resolution reducing the legal fees from more than $17,000 to $5,874. The resolution also required the applicant to maintain a $1,000 minimum balance in an escrow fund for future costs incurred with the applications, which would need to be replenished as the balance fell below that amount. The resolution indicated that the applications would not be further reviewed absent the payment of the fees and the establishment of the escrow fund.

The applicant sued. The trial court denied the Article 78 proceeding, but the applicant prevailed at the Appellant Division. The appellate court found that the Town’s fee provision exceeded state statutory authority. The Appellate Division noted that such fees needed to be “reasonable and necessary.” The Court found that the definition of “reasonable” in the Town Code was appropriate as it required a reasonable relationship to customary charges of similar consultants in the region in connection with similar land use applications. The Town Code definition of “necessary,” however, was rejected by the Appellate Division as it was way too broad, and was out of step with established precedent. The Town Code defined necessary consulting fees as those required “to assist in the protection or promotion of the health, safety or welfare of the Town or its residents; to assist in the protection of public or private property or the environment from potential damage…to assure or assist in compliance with laws, regulations, standards or codes which govern land use and development; to assure or assist in the orderly development and sound planning of a land use or development;…or to promote such other interests that the Town may specify as relevant.” The Appellate Division found the “to assist” language particularly troubling. The Court was equally troubled by the actions of the Town, first insisting that it be paid in excess of $17,000 in legal consulting fees, and its later reduction to $5,874, which was achieved by the Town merely striking entries from the invoices, without regard to their content or connection to the applications. The Appellate Division noted that the Town imposed liability without making any attempt to determine if similar charges were imposed by other municipalities for similar applications.

The Appellate Division also took aim at the escrow fund with its minimum $1,000 balance. The Court found this perpetual replenishment fund to be an impermissible effort to avoid having the Town’s taxpayers shoulder their share of the cost of governmental functioning.

Municipalities would be wise to examine their own codes to make sure that they seek reimbursement of costs that are reasonable and necessary in light of the specific project at issue, and not use that provision to dissuade or discourage land use applicants or as a means of underwriting the cost of government.

yellow-garbage-bagsA Suffolk Supreme Court Justice has upheld Southold Town’s “yellow bag” law which requires residents to place refuse in Town issued yellow garbage bags.   Proceeds from the sale of the yellow bags are used to operate a transfer station located in Cutchogue.

In March 2012, Go-Green Sanitation, a garbage carter, was hauled into Justice Court by the Town for operating without the proper permit and for failing to comply with the yellow bag law. The Town also obtained a short-lived restraining order from Suffolk County Supreme Court prohibiting the private carter from collecting trash from its residents not contained in the required yellow bags.

In response to the Town’s claims,  and without opposition from the Town, in July 2012, Go-Green removed the state court action to federal court alleging five counterclaims, including: (1) that the Town violated its due process rights by effectively barring it from conducting business in the Town; (2) that Go-Green did not dispose of its trash at the Cutchogue transfer station, as such, it should not be subject to the yellow bag fees and (3) the yellow bag fees constituted  an illegal user fee or tax and as a result thereof,  Go-Green sought to add an additional Southold Town resident defendant in an effort to establish a taxpayer claim against the Town.

On June 12, 2015, in a well-reasoned fifteen (15) page opinion, Eastern District Court Judge Arthur Spatt,  declined to exercise federal jurisdiction over Go-Green’s  counterclaims holding (1) that Go-Green failed to plead and/or establish a federal claim and (2) although Go-Green alleged that it envisioned filing an amended pleading to assert a proper party and proper taxpayer claim;  the Court noted that the pleading before the court, did not, in fact, contain a proper party or a properly pled taxpayer claim.   As such, the federal court lacked subject matter jurisdiction and the matter was remanded back to State Supreme Court for a final determination.

On remand, in a recent July 2016 decision,  Supreme Court Justice Paul Baisley, Jr., found that the Town’s controversial law bears a reasonable relation to the public good as it was enacted to promote recycling.   Judge Baisley further found that the Town did not exceed its authority because the yellow bag law is not an illegal tax.  So, for now, and perhaps until a properly pled taxpayer action is asserted, residents and carers alike should refer to the Town of Southold’s website to determine what their respective yellow bags fees will be.


pomonaThis blog post discusses the hotly contested litigation between the Village of Pomona (the “Village”) and the Congregation Rabbinical College of Tartikov (the “Congregation”) about a proposed rabbinical college. The case, Congregation Rabbinical College Of Tartikov, Inc., v. Village of Pomona, pending in the federal district court for the Southern District of New York, was commenced in 2007. The Village has incurred over $1.5 million in legal fees to date defending the case and that figure is likely to double by the time the case goes to trial later this year. The case involves a plethora of land use and zoning issues. We decided to write two posts on this interesting case. This week’s post will provide information about the claims asserted in the case and the decisions issued by the Court. Next week’s post will deal with sanctions issued against the Village for mishandling evidence.

The Proposed Project

The Village is a small community located in Rockland County. Its zoning code classifies the entire village as R-40, generally limiting development to single-family homes on lots that are at least 40,000 square feet in size (about 1 acre). In 2004, the Congregation purchased a large tract of property (about 100 acres) located in the Village. The Congregation intends to develop the site into a rabbinical college for its Orthodox Jewish community. The rabbinical college will train rabbinical judges. That training can take up to 15 years and includes study and prayer from 5 am to 10 pm each day. The development includes residential housing for students, faculty and their families, 10 synagogues, 4 rabbinical courtrooms and libraries. The Congregation contends that the students must live, study and pray in the same place full-time, in a Torah Community, separated from the outside world and that this requires multi-family housing be available at the site to accommodate the families of the students and faculty. There would be between 50 and 250 housing units, which will consist of apartments with 3 to 4 bedrooms, ranging in size from 1,800 to 2,000 square feet. The Congregation claims that the property is the only available parcel of land that is large enough and situated in close proximity to the religious infrastructure and population required for the rabbinical college.

The Congregation never filed any formal application with the Village for the rabbinical college. The Village initially found out about the rabbinical college when a group opposed to the development leaked a preliminary sketch to Village officials.

In 2007, the Congregation reached out to Village officials to discuss the project and to request a public hearing. In response, the Village’s Board of Trustees responded that a public hearing is premature in light of the fact that the project is illegal and requires a zone change. The Congregation responded by requesting that the Board of Trustees exercise its authority under federal law and grant an exemption as a religious institution that is not subject to local zoning. The Village rejected the exemption request. The Congregation’s response was to file the lawsuit.

The Litigation Begins in 2007

In the action, the Congregation objects to several local land use ordinances, some of which were enacted after the project was under discussion with Village officials. It also raises constitutional challenges and other claims.

The Accreditation Local Law

The Village Code allows for educational institutions as a special use. The Congregation contends that the definition of educational institution in the code prevented it from obtaining a special use permit because of an illogical accreditation requirement it can never meet and because of other building restrictions contained in the law. Under the Accreditation Local Law, an educational institution is defined as a private or religious school that conducts a full-time curriculum a minimum of five days a week for seven months a year and is accredited by the State Department of Education or similar recognized accrediting agency. This local law also contains minimum lot area, maximum development intensity, frontage, access, set back, parking and noise guidelines. The initial definition of educational institution was adopted in 2001 when a different Orthodox Jewish organization attempted to build a Yeshiva (a primary and pre-school facility) on the site and was modified in 2004, after the Congregation purchased the site.

The Dormitory Local Law

Although the Village Code allows dormitories, the code requires that they relate to an educational institution, and cannot have the separate cooking, dining and housekeeping facilities required for the rabbinical college. The definition of dormitory was amended in late 2004 to exclude single family, two-family or multi-family from its purview. In 2007, the Village limited the size of dormitory buildings to not more than 20% of the total square footage of all buildings on a lot. The Congregation contends these changes were adopted to thwart its project, which requires a large number of separate housing units for its students, faculty and their families.

The Wetlands Local Law

In 2007, the Village enacted a wetlands protection ordinance that requires a 100-foot buffer around wetlands that are 2,000 square feet or larger. The Congregation contends that this local law was specifically enacted to prevent it from developing the site since its site contains 37 acres of wetlands. The Congregation also contends that the local law contains exemptions that applied to almost every lot in the village except the Congregation’s parcel.

Other Claims

The Congregation claims that the Village’s zoning and environmental ordinances violate the equal protection clauses of the federal and state constitutions, the free speech, free exercise and free association clauses of the first amendment of the federal constitution, the federal Religious Land Use and Institutionalized Persons Act (RLUIPA), the federal Fair Housing Act, the New York State Civil Rights Law and various other state common law claims.

2013 Ruling On The Motion To Dismiss

The Village’s initial response to the lawsuit was to file a motion to dismiss. Part of the claims were dismissed but several survived. In a decision issued in January 2013, the Court made the following rulings. It initially found that the Congregation has standing as it suffered an injury-in-fact as a result of the alleged illegal conduct of the Village; that there is a causal link between the challenged regulations and this injury; and there is a non-speculative likelihood that the injury can be remedied by the relief requested in the complaint.

The Court then evaluated the second ground asserted by the Village for dismissal – ripeness. In particular, the Village claims that the Congregation’s facial challenges to the zoning code, the equal protection clauses of the federal and state constitutions, the free speech, free exercise and free association clauses of the first amendment of the federal constitution and the federal RLUIPA are not ripe for adjudication since the Congregation had not applied for a permit. The Court rejected this challenge noting that a facial challenge is ripe as soon as the regulation is enacted (although it did dismiss one part of the free association facial challenge regarding familial association.)

In assessing the facial challenges, the Court explained these types of claims require a party to demonstrate that the mere enactment of the legislation violates its rights. The Court considered the Congregation’s assertion that the Village had a discriminatory motive behind the enactments. The timing of the enactments and questionable public comments made by government officials preceding the enactments suggested a discriminatory motive. The Court also considered the discriminatory effect of the local laws. Here, the effect is that the local laws prevent the rabbinical college from being built because of the restrictions on the type of housing that is allowed, the requirement that the college be accredited because there is no equivalent accreditation agency for a rabbinical college and the State Education Department does not accredit any college until after it is opened and operating. The Congregation also asserts that the Village adopted a series of laws over the years to prevent the development of this site and nearby sites by Jewish institutions while at the same time allowing other non-Jewish religious organizations to develop sites within the village.

The Village also claimed the Congregation’s as-applied challenges to the zoning code are not ripe because the Congregation has not formally applied to the village. The Court agreed that the Congregation’s as-applied challenges under the free speech, free exercise and free association clauses of the first amendment and the equal protection clause of the fourteenth amendment of the federal constitution, RLUIPA and state law are not ripe and dismissed them.

2015 Ruling On The Motions For Summary Judgment

The parties engaged in extensive discovery after the motion to dismiss was decided. They then filed motions for summary judgment, which the Court ruled on in September 2015. The Court granted summary judgment to the Village on the free speech and New York common law claims (meaning that those claims were dismissed); granted summary judgment to the Congregation on certain affirmative defenses asserted by the Village and granted the Congregation’s motion for sanctions. The Court determined that there are material issues of fact associated with the remaining claims that require a trial.

The jury will decide whether the prohibitions found in the laws, such as the inability to meet the accreditation requirements and the dormitory restrictions that prohibit the housing units required by the college, violate the rights of the Congregation. The jury will determine whether the multi-family housing units are necessary for the Congregation to exercise its religious beliefs, and whether the wetlands restrictions were drafted to target the 100 acre parcel. The jury will decide whether the local laws were passed with a discriminatory purpose and effect and whether the Congregation’s free association and free exercise of religion rights were violated by the Village. The jury will decide whether the rabbinical college must include the housing and other accessory structures for the Congregation to be able to exercise its religious beliefs and whether the Village’s actions placed a substantial burden on the exercise of the Congregation’s religious beliefs.

Next Steps

The case is expected to go to trial soon, but that is unlikely to be the end of the matter. The losing side is likely to appeal. And the animosity between the Village, its residents (who are footing the bill for the defense of this lawsuit) and the Congregation will continue to grow.


My partner, Anthony Guardino, recently posted a three-part series about land use fees on this blog. This post concerns a decision by the Appellate Division upholding a $776,307 “Park Fee” imposed by the Village of Westhampton Beach in connection with the development of a 6.59 acre tract of land.

Westhampton Beach Associates, LLC v Incorporated Village of Westhampton Beach, 151 AD3d 793 [2d Dept 2017] involves a 39-unit condominium development. The Village Planning Board approved the site plan in 2008 on the condition that the developer pay a recreation or park fee (“Park Fee”) to be set by the Village Board of Trustees pursuant to Village Law § 7-725-a(6) and § 197-63(Q)(2) of the Village Code. The Park Fee was imposed because the reserved area required by the Village Code could not be located within the site plan. The Village determined that 63,684 square feet of reserved area was otherwise required based on the site plan.

The Village Code contains a formula to calculate the Park Fee based on the fair market value of the land at the time of the application, the total area shown on the site plan in square feet, 2,178 square feet of reserved area per dwelling unit and the number of dwelling units.   Using the formula, in 2011, the Village calculated the Park Fee to be $776,307.

The developer sold the parcel to a third-party in 2012 before the developer paid the Park Fee. The deal included a provision that the purchase price was reduced by the amount of the Park Fee that the purchaser would pay to the Village. It also provided that if any portion of the Park Fee was waived by the Village or was disallowed for any reason, the buyer would pay that amount to the developer. Two years later, the developer sued the Village, contending that the Park Fee was unconstitutionally vague, as a way to recoup that money from the purchaser.

The Appellate Division first discussed two defenses raised by the Village – standing and statute of limitations. The Court ruled in favor of the developer on these impediments. The Court held that even though the developer sold the parcel before it paid the Park Fee, it still had standing to challenge the constitutionality of the Park Fee. The Court reasoned that the Park Fee was applied to the parcel at the time the developer owned the site and the subsequent sale and price reduction was an actual harm to the developer.   The Court then determined that the claim was not time-barred, as it was not subject to the four-mouth statute of limitations for Article 78 proceedings, since that type of proceeding could not be used to challenge the constitutionality of a Village code provision. Rather, it was governed by the six-year statute of limitations.

Unfortunately for the developer, the Court then ruled against the developer on the merits, finding that the Village Code provision was not constitutionally vague. Thus, the developer is unable to recoup the amount of the reduction in the purchase price attributable to the Park Fee, and the Village is able to continue imposing this significant fee on other applicants.

When New York Governor Kathy Hochul executed the 2022-2023 State Budget, it included a 10-year extension to the State’s Brownfield Cleanup Program (“BCP” or “Program).  The State’s voluntary, incentive-laced, BCP was set to expire on December 31, 2022.  The Program’s extension generally reinforces the State’s commitment to incentivize the remediation and re-use of environmentally-compromised and economically-blighted property.

Applicants can now be accepted into the BCP through December 31, 2032 and be eligible to receive tax-credit benefits if a Certificate of Completion (“COC”), confirming the remedial action objectives for the BCP site have been achieved, is issued on or before December 31, 2036.

In addition to extending the BCP, the Budget included a number of amendments that serve to extend and/or expand and increase the availability of BCP tax credits.  Specifically, the amendments include:

  • A 2-year extension to claim site preparation credits and/or on-site groundwater remediation credits for sites that received a COC between July 1, 2015 and June 24, 2021. The timeframe for claiming the credits was previously 5 tax years from the issuance of a COC, the Budget amends the timeframe to 7 tax years.
  • An extension to the timeframe for sites that received a COC between March 20, 2010 and December 31, 2015 to claim qualified tangible property tax credits (improvement/development costs) to 180 months (15 years) from the issuance of a COC.  Previously, the claims were available for a period of 10 years, with an additional 2-year allowance if it was determined the requirements for the credit would have been met, if not for COVID restrictions.
  • The addition of a 5% increase in available qualified tangible property credits for sites developed as renewable energy facilities or for sites developed in a “disadvantaged community” within a Brownfield Opportunity Area. Qualified tangible property credits can range from 10% to 24% of development costs (subject to certain credit amount caps) based on a number of qualifying factors, including the level of cleanup, and if the project is located within an Environmental Zone or Brownfield Opportunity Area.
  • Expansion of eligibility for qualified tangible property credits to sites located in New York City for renewable energy facilities and sites characterized as a “disadvantaged community” located within a Brownfield Opportunity Area. Prior to the amendment, qualified tangible property credits in NYC were only available to sites that demonstrated (a) at least half of the site is located in an Environmental Zone, (b) the property is upside down or underutilized, or (c) the project is an Affordable Housing Project.
  • Inclusion of stadiums, baseball parks, basketball courts and other athletic facilities and equipment, including sports field turf, lighting and access and entry ways, among other improvements, as qualified tangible property for sites cleaned up to a Track 1 remediation standard beginning in tax year 2022.

In contrast to the expansion and extensions to obtain BCP incentives, the amendments also potentially curtail eligibility of certain benefits for Affordable Housing projects and incorporate a pay-to-play component for projects admitted into the BCP:

  • The amendments modified the definition of Affordable Housing Project to include language authorizing Department of Environmental Conservation (“DEC”), after consultation with the Division of Housing and Community Renewal, to exclude specific benefits.
  • The amendments introduce a non-refundable program fee of $50,000 payable upon admittance into the BCP. The fee is waivable upon a showing of financial hardship.  The fee does not qualify for any of the BCP tax credits.  The amendments require the DEC to establish regulations defining a financial hardship.  The amendments establish the preliminary criteria  for evaluating financial hardship as (a) considering whether an applicant has waived its tax-credit benefit rights, (b) determining if the project is located in a disadvantaged community or if the site is being developed as an Affordable Housing Project, and (c) reveiwing the assets and income of the applicant.

 The amendments achieve the goal of extending the BCP and expanding and/or extending the incentives associated with the BCP.  However, imposing flat, non-refundable fees on all applicants would seemingly curb lower-margin projects, smaller projects and projects located in less dense population areas.

For more information regarding the BCP, please contact Jesse Hiney (631.367.0718).