tag: North Carolina Land Use Litigator: October 2014

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Wednesday, October 15, 2014, 4:19 PM

Nevada and D.C. Courts Give Priority of Position to HOA Assessment "Superliens" Over First Mortgages

Mortgage lenders beware.

In late August, the D.C. Court of Appeals rendered a decision in Chase Plaza Condominium Association, Inc. v. J.P. Morgan Chase Bank, N.A., CA-5826-10 (August 28, 2014) determining that a homeowner's association's (HOA's) statutory "super-priority" lien, or superlien, for unpaid assessments took priority of position over other liens, including a lender's mortgage lien.  Read that again: not just priority of payment, but priority of position for these HOA assessment superliens.

In jurisdictions (like D.C.) that have adopted these "superliens" -- there are some 20 jurisdictions, in varying definitions -- the HOA assessment superlien has priority over mortgages and deeds of trust, even if senior or preexisting, "to the extent of common expense assessments ... which would have become due in the absence of acceleration during the [six] months immediately preceding institution of an action to enforce the lien."  D.C. Code 42-1903.13(a)(2).

Last month, the Nevada Supreme Court followed suit and concluded in SFR Investments Pool 1, LLC v. U.S. Bank, N.A., No. 63078 (Sept. 18, 2014) that the Nevada HOA lien statute is based on the Uniform Common Interest Ownership Act of 1982 (along with at least seven other states: AK, CO, CT, DE, MN, VT and WV; NC is not such a state).  To that extent, the Nevada Court concluded that a portion of an HOA assessment lien was superior in position -- position priority -- to a first deed of trust and rejected the lender's argument that the statute only afforded a payment priority to the HOA and its superlien.

What is the actual impact?  Well, if the HOA forecloses its superlien, not only does it collect its debt, but it eliminates or "wipes away" the first mortgage or first deed of trust, as well as any other junior liens on the property.

What is the practical impact?  Lenders with first position are forced, in most cases, to pay off the HOA's assessment superlien in order to preserve the first position.  If not, and foreclosure is completed, the sale price can sometimes fall "at an amount equal to or slightly above the HOA dues in arrears", as reported by the Wall Street Journal.

The justification for these HOA superliens is quite simple: HOAs are critical to the preservation of the value of the community, and should wield significant authority to ensure that they receive the funds necessary to maintain the community and, so, real estate valuations.

The significance of that ruling for lenders, borrowers and HOAs cannot be understated in states granting these HOA superliens.  For HOAs, these cases cement the power they have to obtain payment for past due assessments.  For lenders, on the other hand, enforcement strategies must change and underwriting and loan documentation practices must evolve.    

The lender in the Nevada case has petitioned the State Supreme Court for reconsideration; we can expect a move to the Supreme Court of the United States if that bid is unsuccessful.  The stakes are just too high, it seems.


Mike Thelen practices in Womble, Carlyle's Real Estate Litigation and Land Use practice group. He regularly represents a wide variety of clients, from local governments to businesses, in land use and land development matters in both state and federal venues throughout North Carolina.

Follow the North Carolina Land Use Litigator on Twitter at @nclanduselaw and "like" us on Facebook here.

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Monday, October 13, 2014, 11:46 AM

N.C. Federal Court Dismisses as Unripe a Takings Claim Based on Land Use Issue

Today's blog post comes directly from The Law of the Land blog, from our prolific and brilliant friend Dean Patricia Salkin of the Touro College Jacob D. Fuchsberg Law Center.

Today's piece digests a recent decision from the U.S.D.C. for the Eastern District of North Carolina dismissing as unripe a takings claim against the City of Raleigh.  Plaintiffs claimed the City "forced" them to give a public access right of way "in order to get a building permit", even citing Lanvale Properties LLC v. County of Cabarrus, 366 N.C. 142 (2012) in opposition to the City's dismissal motion.  The City, on the other hand, successfully argued that the plaintiff's did not "obtain[] a final administrative decision" from the City before filing the takings, due process and equal protection claims against the City, rendering the lawsuit unripe.

We're always excited when a land use issue -- here, the dispute over a building permit and the conditions thereto -- is the basis for a takings claim against a local government.

To Professor Salkin:

CarSpa Automotive, LLC, Marjorie Putnam, and Carl Deny (collectively, “plaintiffs”) filed a complaint against the City of Raleigh, North Carolina (“City”), claiming that the City had taken their property without paying just compensation, deprived them of property without due process of law, and denied them equal protection. Plaintiffs contended that the City “forced Plaintiffs to give a public access right of way in order to get a building permit for their property and as a result, their business had not been profitable".

The City contended that plaintiffs’ claims were unripe because the plaintiffs had not obtained a final, reviewable decision from the City or sought compensation through state-law procedures for obtaining just compensation.

The federal district court noted that a takings claim is not ripe for adjudication in federal court unless the plaintiff has obtained a final administrative decision regarding the application of the challenged regulations to the property, and has sought and been denied just compensation through the available and adequate state procedures. Williamson Cnty. Regional Planning Comm'n v. Hamilton Bank of Johnson City, 473 U.S. 172, 186 (1985). Here, plaintiffs had not obtained a final administrative decision or been denied just compensation.

As for finality, where the regulatory regime offers the possibility of a variance from its facial requirements, a landowner must go beyond submitting a plan for development and actually seek such a variance to ripen his claim. Here, property owner could have appealed to the Board of
Adjustment for a variance from the City’s ordinances but they did not. Accordingly, the court held the plaintiffs had not obtained a final administrative decision. This failure also barred their due process and equal protection claims.

Plaintiffs argued under Sherman v. Town of Chester. 752 F.3d 554 (2d Cir.2014), the finality requirement should not apply because the City had behaved badly throughout the permit process. In Sherman, the court held that a takings claimant was not required to satisfy Williamson County’s finality requirement because the defendant Town had used “repetitive and unfair procedures” to avoid issuing a final decision. Here, plaintiffs’ conclusory allegations of the City’s “bad behavior,” were insufficient to exempt them from obtaining a final administrative decision.

Alternatively, even if the final-decision requirement were waived, plaintiffs’ takings claim would still not be ripe because plaintiffs had not been denied just compensation. To satisfy Williamson County’s state-procedures requirement, plaintiffs “must not only file a state law inverse condemnation claim they must also be denied just compensation through a final adjudication in state court.” Town of Nags Head v. Toloczko, 728 F.3d 391 (4th Cir.2013). Here, the plaintiffs had not pursued the available and adequate procedures North Carolina provides for seeking just compensation. Accordingly, their takings claim was not ripe.

The case is CarSpa Automotive, LLC v. City of Raleigh, No. 5:14-CV-21-D (E.D.N.C.).  The Order dismissing the lawsuit for lack of subject matter jurisdiction can be viewed here.


Mike Thelen practices in Womble, Carlyle's Real Estate Litigation and Land Use practice group. He regularly represents a wide variety of clients, from local governments to businesses, in land use and land development matters in both state and federal venues throughout North Carolina.

Follow the North Carolina Land Use Litigator on Twitter at @nclanduselaw and "like" us on Facebook here.

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Friday, October 10, 2014, 2:45 PM

Asheville City Hall's Celebratory "Rainbow Flag" Challenged on Basis of Local Government Powers

All are presumed to know about the recent activity around the legal issue -- not the human issue, the legal issue -- of same-sex marriage.

In Asheville, in response to the coming legal change, the City Council earlier this week placed a rainbow flag on City Hall.  You can read about the decision here.  The image below is of that flag.

Well, today, Carl Mumpower, a former member of the Asheville City Council, and Chad Nesbitt, the former chair of the Buncombe County (in which Asheville sits) G.O.P. party, jointly and publicly expressed disagreement with the City's decision to fly the rainbow.

You can read about the criticism here.

The reason we find this interesting is not at all because of political predilections, and even less so because of the moral, religious and philosophical disagreements that come to bear on the topic of same-sex marriage. Rather, we find this interesting because Messrs. Mumpower and Nesbitt challenge the act of flying the rainbow flag on the basis of local government powers.  Specifically, they take aim at (1) the City Council's decision to instruct the City Manager to fly the flag, which they allege violates the City Charter provisions separating the legislative powers held by the Council from the operational powers held by the City Manager; and (2) the City Council cannot, either arbitrarily or on an emotional whim, instruct the City Manager on operational issues unless the Council goes through the proper legislative process, including advertisement and public hearing.

Local government powers are constantly at the fore.

  "A little to the left.  A little more to the left.  A little bit more to the left.  There!  Perfect."

Mike Thelen practices in Womble, Carlyle's Real Estate Litigation and Land Use practice group. He regularly represents a wide variety of clients, from local governments to businesses, in land use and land development matters in both state and federal venues throughout North Carolina.

Follow the North Carolina Land Use Litigator on Twitter at @nclanduselaw and "like" us on Facebook here.

Thursday, October 9, 2014, 5:10 PM

Raleigh and Wake County Websites Recognized Among Best, Nationwide

As any good business knows, a good website is critical.  A good website provides an impression, serves at a repository for information, functions as a means of communication and works as a vehicle for a transaction, among other important uses.

A local government website is no exception.  The municipal laws?  The address of the parks department?  The baseball field's hours?  The next meeting of the board of adjustment?  Paying a water bill?  All can be found or achieved through a good website.

What does this have to do with land use or litigation, you ask?  Well, tons and tons.

In the land use space, a good local government website is critical.  The zoning map?  The next agenda for the upcoming meeting of the governing board?  The minutes from the last meeting of the planning board?  The geographic information system (GIS), or other means of gathering property information? All of this is available at the local government offices, sure, but efficiency and even accuracy can be enhanced when the information goes digital and can be accessed on a website.  We spend a great deal of time researching local government websites for information whether we are working with, for or against a local government in the land use space.  Better information leads to better government, better development and better communities.  And a good website can provide and deliver that better information.

The City of Raleigh, where the Land Use Litigator is based, was recently recognized as one of the 10 Best Local Government Websites for 2014 by Government Technology and eRepublic's Center for Digital Government.  For its part, Wake County, in which Raleigh sits, is named in the top 5 of the best county government websites.  The rankings for the Digital Government Achievement Awards can be seen here.



Mike Thelen practices in Womble, Carlyle's Real Estate Litigation and Land Use practice group. He regularly represents a wide variety of clients, from local governments to businesses, in land use and land development matters in both state and federal venues throughout North Carolina.

Follow the North Carolina Land Use Litigator on Twitter at @nclanduselaw and "like" us on Facebook here.

Wednesday, October 8, 2014, 1:44 PM

Land Use By Another Name?: Local Governments Seek to Tax Softdrinks By Ballot Measure

Our regular readers will know that this blog is as much about land use, specifically, as it is about local government powers, generally, and the direct and indirect impacts on land use.

Voters in two California cities -- San Francisco and Berkeley -- will go to the polls next month to consider a city tax on soft drinks.  Specifically, San Francisco voters will consider a "more aggressive" $.02 tax per ounce, with the tax proceeds going to the City and channeling into health and wellness programs.  Berkeley voters will consider a "taker" $.01 tax per ounce, with the taxes going into the City's general fund.  Such voter measures have not had much success in the U.S., with a measure recent failing in Telluride, Colorado, for example.   We don't know of successful or unsuccessful legal challenges.

These taxes are interesting to us insofar as it represents another means by which a local government could endeavor to control land uses, though with a different power.  For example, we've seen in the past the efforts by local governments in North Carolina to control the existence or location of the promotional sweepstakes industry within municipal borders through the use of the privilege license tax powers.  Could this paradigm we're seeing in California replace the since-repealed privilege license taxing power?

We have not reviewed whether such ballot measures would be legal in North Carolina, but it is worth noting that one of the players in the polling used to support California tax measure is our own flagship University in Chapel Hill, as reported by The New York Times.


"If we tax this an additional $.02, that would double its cost of production."

Mike Thelen practices in Womble, Carlyle's Real Estate Litigation and Land Use practice group. He regularly represents a wide variety of clients, from local governments to businesses, in land use and land development matters in both state and federal venues throughout North Carolina.

Follow the North Carolina Land Use Litigator on Twitter at @nclanduselaw and "like" us on Facebook here.

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Tuesday, October 7, 2014, 3:26 PM

Call Before You Dig: North Carolina's New "Underground Utility Safety and Damage Prevention Act" Takes Effect October 1, 2014

This past session, the North Carolina General Assembly replaced the existing Underground Damage Prevention Act with the Underground Utility Safety and Damage Prevention Act, which took effect on October 1, 2014.

Developers (excavators) and local governments (Facility Operators) alike should take note.

The Act's stated purpose is "to protect the citizens and workforce of this State from the dangers inherent in excavating or demolishing in areas where underground lines, systems, or infrastructures are buried beneath the surface of the ground" and "to protect from costly damage underground facilities used for producing, storing, conveying, transmitting or distributing communication, electricity, gas, petroleum, petroleum products, hazardous liquids, water, steam, or sewage."

The Act is meant to provide for a systemic, orderly, and uniform process to identify existing underground facilities in advance of any excavation or demolition and to implement safe digging practices.

What are the new obligations as of October 1, 2014?  Let's see.

Operators.  The Act requires "operators" to maintain and join a "Notification Center".  An "operator" is defined as any person, public utility, communications or cable service provider, municipality, electrical utility, or electric or telephone cooperative that owns or operates a Facility within the State.

Facility.  A facility is defined to include any underground line, system or infrastructure used for producing, storing, conveying, transmitting, identifying, locating, or distributing communication, electricity, gas, petroleum or petroleum products, hazardous liquids, water, steam or sewage.

Notification Center.  A Notification Center is defined to mean a member-owned, not-for-profit corporation sponsored by Facility Operators that will provide a system through which persons may notify Facility Operators of proposed excavations and demolitions.  It is apparently intended that North Carolina 811 serve as the defined Notification Center.  All Facility Operators must become members of the Notification Center in a phased plan, depending on Facility Operators characteristics, as defined in the Act.

Excavator.  An excavator is defined as "[a] person engaged in excavation or demolition".  It is broad.

Excavator Responsibilities.  Before commencing any excavation or demolition, the person responsible for the activities must provide notice to the Notification center of the intent to act.  The Act is specific about the contents and timing of the notice, varying by virtue of the type of excavation or demolition involved.  Besides notice, excavators must also comply with ten (10) specific sets of requirements designed to avoid damage or minimize interference with Facilities.  

Facility Operator Responsibilities.  The Act requires much of Facility Operators.  Facility Operators are required to prep[are installation records of all Facilities installed in a public street, alley, or right-of-way dedicated to public use, excluding service drops and service lines.  The Facility Operator must maintain the records while the Facility is in service.  Additionally, all Facilities installed after October 1, 2014 shall be "electronically locatable" using a locating method that is generally accepted by operators in the particular industry or trade in which the Facility Operator is engaged.  Upon notice from an Excavator, the Facility Operator must provide the Excavator with the horizontal location and description of all of the Facility Operator's Facilities in the area where the proposed excavation or demolition is to occur.

Excavator Liabilities.  If an Excavator performs an act that damages a Facility, the Excavator is required to immediately notify the Notification Center and the Facility Operator.  If the damage results in the discharge of electricity or any flammable, toxic, or corrosive gas or liquid, the Excavator must immediately notify emergency responders in addition to the Notification Center and the Facility Operator.  If a Facility Operator fails to respond or properly locate pursuant to proper notice from an Excavator, the Excavator is free to proceed and will not be liable to the Facility Operator for damages provided there is due care.

Notice Exemptions.  The Act contains a number of instances wherein notices are not required by an Excavator, such as excavation by a single-family homeowner, in an emergency or when a local government is conducting maintenance activities within its designated right-of-way.

Finally, the Act expressly preempts local ordinances of certain types.  Here's how Raleigh is addressing parts of the new law.


Mike Thelen practices in Womble, Carlyle's Real Estate Litigation and Land Use practice group. He regularly represents a wide variety of clients, from local governments to businesses, in land use and land development matters in both state and federal venues throughout North Carolina.

Follow the North Carolina Land Use Litigator on Twitter at @nclanduselaw and "like" us on Facebook here.

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Asheville Gets "In" On It: Innovation Districts and the Return of the Suburban Worker

We blogged last week about an innovation district coming to Durham, North Carolina, to be affectionately called "Durham ID".

Asheville, North Carolina, is poised to designate three innovation districts of its own in the downtown area -- River Arts, South Slope, Charlotte Street -- with the goals of increasing the City's tax base while bringing quality-of-life improvements to residents.

Innovation districts are becoming an urban rage.  These land use animals are defined by some, including the Brookings Institute, as "geographic areas where leading-edge anchor institutions and companies cluster and connect with start-ups, business incubators and accelerators [to create] physically compact, transit-accessible and technically wired [urban areas offering] mixed-use housing, office and retail".  Think of these as infill versions of the 1980s office park.  In fact, Brookings makes specific reference to "the transformation of traditional exurban science parks like Research Triangle Park in Raleigh-Durham", which Brookings contends is "scrambling to keep pace with the preference of their workers and firms for more urbanized, vibrant environments."

Municipal "buy-in" is critical for the development of such innovation districts, of course, where underutilized areas (particularly older industrial areas) are being re-imagined and remade.  Also, this "urban movement" of the educated workforce -- the "great inversion" -- is not without its challenges.  For example, Richard Florida reports in The Atlantic Citylab that people (and, most notably, "high-income people") are returning to downtowns to live and to work, hence the allure of the innovation district, however those people are bringing with them "their preferences for and abilities to purchase larger home or condos and private cars."  In other words, the creative class is reurbanizing but holds tightly to the habits developed by a suburban upbringing.

We are excited to see such public-private collaboration as is evidenced by the rise in the innovation district.  But, as always, careful and open planning among landowner, neighbor and government will be critical to success. 


Mike Thelen practices in Womble, Carlyle's Real Estate Litigation and Land Use practice group. He regularly represents a wide variety of clients, from local governments to businesses, in land use and land development matters in both state and federal venues throughout North Carolina.

Follow the North Carolina Land Use Litigator on Twitter at @nclanduselaw and "like" us on Facebook here.

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Monday, October 6, 2014, 5:46 PM

The Onion Spoofs Land Use, Cites the "Admittedly Crazy Idea" of Urban Waterfront Revitalization

So many great ideas sound so simple, so obvious after development and actualization, right?

Velcro. Tupperware. The cheeseburger. Buying a condo in Manhattan's West Village in 1987.

Our sardonic and wonderfully observant friends at The Onion think urban redevelopment, or infill, is no exception.  In this piece, available here, The Onion writes about how "Mayor Hits On Crazy Idea of Developing City's Waterfront, Green Spaces".  From the piece:
Though the proposal [to convert unused and blighted lakefront into a family- and business-friendly hub] has received cautious support, city council president Melvin Witherspoon told reporters that the mayor's idea to open the refurbished waterfront with a weekend-long street festival was 'the unhigned ranting of a madman'.
What's especially fun for us at the Land Use Litigator is that this gem indicates the Monday-morning brilliance of and consensus behind the actualization of urban revitalization.  In other words, land use is now in the parody mainstream.  Reinvention, evolution and innovation is still occuring, and urban living is becoming so desirable as to appear to have been painfully obvious along the way.

Man, I can't wait for the inevitable Saturday Night Live skit about wetland mitigation.
Thanks to our friend Professor John Infranca @JohnInfranca for alerting us to this lighthearted but consequential little piece.

Mike Thelen practices in Womble, Carlyle's Real Estate Litigation and Land Use practice group. He regularly represents a wide variety of clients, from local governments to businesses, in land use and land development matters in both state and federal venues throughout North Carolina.

Follow the North Carolina Land Use Litigator on Twitter at @nclanduselaw and "like" us on Facebook here.


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North Carolina Ranks Third Among U.S. States, First In the East, In Solar Power Installations for 2013

The Interstate Renewable Energy Council reports in its U.S. Solar Market Trends 2013 that North Carolina ranks third among U.S. states in solar power installations in 2013.  The 261 megawatts installed, which is how these things are measured, is a 114% increase over that installed in 2012 in North Carolina.

The states ranked ahead of North Carolina in 2013, in terms of installation?  California and Arizona, which boast geographic challenges not seen in the Old North State.  Oh yeah, and that puts North Carolina at the fore of the East Coast.

This growth in solar power is only going to continue.  Duke Energy announced in September that it will spend another $500 million to expand its solar electricity use in North Carolina, including the construction of the largest array east of the Mississippi.

Solar power brings very interesting and complex regulatory and land use issues.

"Anthem of the Sun, including the B-side: 'Let's Go Green'."

Mike Thelen practices in Womble, Carlyle's Real Estate Litigation and Land Use practice group. He regularly represents a wide variety of clients, from local governments to businesses, in land use and land development matters in both state and federal venues throughout North Carolina.

Follow the North Carolina Land Use Litigator on Twitter at @nclanduselaw and "like" us on Facebook here.

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Friday, October 3, 2014, 9:36 AM

Coming Attractions: 15-Acre Durham Innovation District, a "Downtown Research Hub"

The Durham Innovation District, or Durham ID, is coming to downtown Durham, North Carolina.  The project envisions the redevelopment of 15 downtown acres to include one million square feet of new office and laboratory space, 50,000 square feet of retail space and even residential units.  The project has been compared to Kendall Square near Harvard.

The partners in the project describe it as creating a downtown research hub with an emphasis on life science companies.  While "apps" and drone companies and other tech notions might take up residence, it appears the vision is to accommodate the more organic corners of the technical world. Durham is the City of Medicine, after all.

Development partner Longfellow Real Estate Partners says it well, as though channeling Richard Florida:  "You've got institutions like Duke University, Durham Tech, North Carolina Central University, a strong local work force and a tie-in to the greater Triangle area and market.  We [at Longfellow] think all those components together make for a great opportunity."

This is the latest in what has been an exciting Renaissance in real estate and cultural development in Durham, only 20 minutes west of Raleigh.

"Ok, everyone remember that we parked in the Louis Pasteur lot, in space number 'square root of -1'."

Mike Thelen practices in Womble, Carlyle's Real Estate Litigation and Land Use practice group. He regularly represents a wide variety of clients, from local governments to businesses, in land use and land development matters in both state and federal venues throughout North Carolina.

Follow the North Carolina Land Use Litigator on Twitter at @nclanduselaw and "like" us on Facebook here.

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Thursday, October 2, 2014, 4:23 PM

Raleigh and State Are Close(r) on a Deal for "Destination" Dix Park

We've blogged in the past here and here about the dance between the City of Raleigh and the State of North Carolina over the City's 300-plus acre Dorothea Dix campus, which belongs to the State, leased to the City, returned to the State, and the sale of which has been negotiated over time between the State and the City.

To refresh, the City wants the land to create, most likely, a destination park in the growing and increasingly dense downtown.  The State (read: the General Assembly), on the other hand, wants a certain price above the value placed by the original, "condemned" lease and wants to retain some of the land for State agencies.

It looks like negotiations are "ongoing", which is good news for the citizens of both.  Recent reporting, apparently based on public records from the Governor's office, indicates that the City offered purchase terms to the State on August 29, to which the State responded on September 12.

The upshot is that the State and the City are likely to reach a deal.  The parties appear to be closer in price than they had been before (albeit still significantly far apart, though there is desire and momentum), the State has apparently reduced the amount of acreage it wishes to retain for housing certain services, and, lastly, who doesn't love a park.


"A Sunday in the Park with Pat, Thom, Nancy, Phil, and DHHS.  Oh, and Boylan Heights people."

Mike Thelen practices in Womble, Carlyle's Real Estate Litigation and Land Use practice group. He regularly represents a wide variety of clients, from local governments to businesses, in land use and land development matters in both state and federal venues throughout North Carolina.

Follow the North Carolina Land Use Litigator on Twitter at @nclanduselaw and "like" us on Facebook here.

Illinois Court: Municipal Zoning and Stormwater Laws Apply to School District's Construction Project

Much of land use law involves questions over the breadth of local government powers.

Today, we're looking at a spat between two units of local government: a municipality and a school board.  The decision in Gurba v. Community High School District No. 155, 2014 Ill. App. 2d 140098 (September 3, 2014)  from Illinois addresses the reach of a City's zoning laws to a football stadium project undertaken by the local school board.  We see alot of government versus the private property owner.  But who wins between units of government?

It's the pulpit versus the pencil.  Ding!

Facts
A School Board decided to rearrange the bleachers in a high school football stadium to "improve traffic flow inside the stadium".  The School Board "did not proceed under the City's zoning code or notify the City".

While the bleacher project was underway, the City objected to the project, maintaining that the project required a special-use permit, a stormwater permit and zoning variances from the City.  The School Board disagreed and "did not change the project to comply with the City's zoning restrictions".  The City issued a stop work order against the School Board.

The Lawsuit 
In the meantime, neighboring landowners sued the School District and School Board "seeking to privately enforce the City's zoning and stormwater ordinances".  In turn, the School Board brought a third-party complaint against the City "seeking a declaration that the project was not subject to the City's zoning or stormwater ordinances."

The trial court entered judgment finding that the project is subject to the City's zoning and stormwater ordinances, and the School Board appealed.

The Appellate Opinion
The City wins, and zoning and stormwater ordinances apply to the School Board's project.  

Referring to the case as presenting "an issue of first impression, namely, whether local school boards and districts are subject to the land-use and zoning regime of the municipality in which they reside", the appellate court affirms the trial court using the following reasoning:  
(1) A school district's constitutional mandate to provide for education does not preempt or otherwise preclude the enforcement of local government ordinances.  Yes, a local government may not "enact ordinances that infringe upon the realm of public education, such as by changing local graduation requirements or some other action that would affect the content or substance of the public education being offered ...."  Stormwater and zoning ordinances, as "land-use regulations", "have no inherent impact upon the substance of public education. 
(2) School districts and municipalities are distinct, constitutionally speaking.  Municipalities are "home-rule units", which cannot be said of school districts, and "in the case of a conflict between a home-rule unit and a school district, there is a slight bias toward the home-rule unit". 
(3) The School Board's own code "suggests that the local school board must apply for a zoning change variance, or special use rather than exercise zoning powers itself."  The canons of statutory construction -- expressio unius est exclusio alterius -- lead to the holding that the School Board and its project are subject to the City's zoning and stormwater ordinances.  


"Round one goes to the local government."   

Mike Thelen practices in Womble, Carlyle's Real Estate Litigation and Land Use practice group. He regularly represents a wide variety of clients, from local governments to businesses, in land use and land development matters in both state and federal venues throughout North Carolina.

Follow the North Carolina Land Use Litigator on Twitter at @nclanduselaw and "like" us on Facebook here.

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Wednesday, October 1, 2014, 9:33 AM

Boyz In the Agrihood: Planned Communities Trade Golf Courses for Working Farms

I don't play golf.  I like golf, I'll go out and hit around with friends or colleagues, but I don't "play golf".  To me, playing golf means 18 holes on a weekend, maybe 36, and perhaps a round or two during the week.  No, I don't play golf.

And I don't think I'm alone in my generation.  Thus, we don't see much development anymore around golf courses, even here in North Carolina -- home of famed Pinehurst and beautiful Quail Hollow. Sure, it happens, but not nearly as often as it did in the 80s, 90s and even early 2000s.

So, what takes the place of that planned living community "working" greenspace, formerly ruled by gold courses and tennis courts and pools?

Nationally, a growing number of "agrihoods" are popping up, residential developments where a working farm is the central feature.  In northern Durham County, just next to Raleigh, a group of real estate developers are seeking to build a 230-acre subdivision with 140 single family homes and featuring a 15-acre fruit and vegetable farm.  According to conceptions, weekly deliveries of produce from the farm would be included in HOA dues for Wetrock Farm, and the farm will be professionally managed.  Raleigh already has its City Farm, as do other up and coming cities in America, so this new conception of planned living appears to strive to capture what's next for the homeowning American.  It's mutually beneficial, as well, both to developer and purchaser:  "'As a developer it's been humbling that such a simple thing and such an inexpensive thing [like the farm] is the moved loved amenity,' said Brent Herrington, who oversaw the building of Kukui'lua [community development in Kauai, Hawaii] for the developer DMB Associates."

There are sure to be land use planning and operational challenges, of course, and we'll be curious to identify and solve those issues.

"Restrictive covenants include no asphalt walkways, no garish house colors, and extra carrots."

Mike Thelen practices in Womble, Carlyle's Real Estate Litigation and Land Use practice group. He regularly represents a wide variety of clients, from local governments to businesses, in land use and land development matters in both state and federal venues throughout North Carolina.

Follow the North Carolina Land Use Litigator on Twitter at @nclanduselaw and "like" us on Facebook here.

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