Opinion
DOCKET NO. A-2022-14T2
07-29-2016
AB JC INVESTMENTS, LLC, Plaintiff-Appellant, v. BOROUGH OF FRANKLIN LAKES ZONING BOARD OF ADJUSTMENT, Defendant-Respondent.
Robert A. Kasuba argued the cause for appellant (Bisgaier Hoff, LLC, attorneys; Mr. Kasuba and Yolanda N. Melville, on the briefs). Robert F. Davies argued the cause for respondent.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION Before Judges Hoffman, Leone and Whipple. On appeal from the Superior Court of New Jersey, Law Division, Bergen County, Docket No. L-9745-13. Robert A. Kasuba argued the cause for appellant (Bisgaier Hoff, LLC, attorneys; Mr. Kasuba and Yolanda N. Melville, on the briefs). Robert F. Davies argued the cause for respondent. PER CURIAM
Plaintiff AB JC Investments, LLC, appeals the November 19, 2014 order dismissing with prejudice its action in lieu of prerogative writs against defendant, the Zoning Board of Adjustment (Board) of the Borough of Franklin Lakes (Borough). We affirm.
I.
Plaintiff entered into a contract to purchase a 3.21-acre parcel of land located in the Borough in a district zoned for single-family homes. Multi-family housing is neither a permitted nor conditional use in the district. The property currently is occupied by a single-family home, garage, and shed.
In April 2013, plaintiff applied for approval of a proposed site plan for a twenty-four unit, two-building residential development, with forty-six parking spaces. The site plan proposed that five of the twenty-four units be deed restricted for occupancy by low- to moderate-income households.
To carry out its proposal, plaintiff applied for a use variance to build the multi-family structures in the single-family residential zone, N.J.S.A. 40:55D-70(d)(1), and a bulk variance because the total proposed land coverage exceeded the permissible 20%, N.J.S.A. 40:55D-70(c). Plaintiff bifurcated its use variance and site plan applications, as permitted under N.J.S.A. 40:55D-76(b), requesting that the Board consider the site plan if the use variance was granted.
This bulk variance request was subsumed within the use variance request.
The Board conducted three hearings on the use variance application. On November 7, 2013, the Board denied the application.
Plaintiff filed a complaint in lieu of prerogative writs in the Law Division, challenging the Board's denial of its application. Plaintiff primarily argued that, because 20% of the proposed units would be set aside as affordable housing, the proposed use is inherently beneficial, and thus the Board should have granted the use variance.
In his October 23, 2014 written opinion, Judge William C. Meehan found: "The real issue in this matter is whether a 20% unit set aside for low and moderate income is of such an inherent beneficial use that that alone is grounds for a variance being approved by the Planning Board." Judge Meehan held that: (1) plaintiff was not entitled to a use variance simply because it planned to set aside 20% of the proposed units for low or moderate income housing; (2) under Advance at Branchburg II, LLC v. Branchburg Twp. Bd. of Adjustment, 433 N.J. Super. 247 (App. Div. 2013) [hereinafter "Branchburg"], a development setting aside 20% of its units for affordable housing is not "inherently beneficial"; and (3) use variance determinations are not the appropriate mechanism for enforcing a municipality's compliance under the Fair Housing Act (FHA), N.J.S.A. 52:27D-301 to -329.19. Plaintiff appeals.
II.
"Our standard of review for the grant or denial of a variance is the same as that applied by the Law Division." Branchburg, supra, 433 N.J. Super. at 252 (citing Bressman v. Gash, 131 N.J. 517, 529 (1993)). "We defer to a municipal board's factual findings as long as they have an adequate basis in the record." Ibid. "[W]hen a party challenges a zoning board's decision through an action in lieu of prerogative writs, the zoning board's decision is entitled to deference." Kane Props., LLC v. City of Hoboken, 214 N.J. 199, 229 (2013). Indeed, "zoning boards, 'because of their peculiar knowledge of local conditions[,] must be allowed wide latitude in the exercise of delegated discretion.'" Price v. Himeji, LLC, 214 N.J. 263, 284 (2013) (citation omitted). However, a zoning board's "'legal determinations are not entitled to a presumption of validity and are subject to de novo review.'" Jacoby v. Zoning Bd. of Adjustment, 442 N.J. Super. 450, 462 (App. Div. 2015) (citation omitted).
"[C]ourts ordinarily should not disturb the discretionary decisions of local boards that are supported by substantial evidence in the record and reflect a correct application of the relevant principles of land use law." Lang v. Zoning Bd. of Adjustment, 160 N.J. 41, 58-59 (1999). "[T]he burden is on the challenging party to show that the zoning board's decision was 'arbitrary, capricious, or unreasonable.'" Price, supra, 214 N.J. at 284 (quoting Kramer v. Bd. of Adjustment, 45 N.J. 268, 296). Additionally, "[c]ourts give greater deference to variance denials than to grants of variances, since variances tend to impair sound zoning." Med. Ctr. at Princeton v. Twp. of Princeton Zoning Bd. of Adjustment, 343 N.J. Super. 177, 199 (App. Div. 2001). We must hew to our standard of review.
A.
Plaintiff argues that the Board's decision should be reversed because the site plan satisfied the positive criteria required for obtaining a land use variance under N.J.S.A. 40:55D-70(d)(1).
"[M]unicipalities are authorized to impose conditions on the use of property through zoning by a 'delegation of the police power' that must 'be exercised in strict conformity with the delegating enactment'" of the Municipal Land Use Law (MLUL), N.J.S.A. 40:55D-1 to -163. Price, supra, 214 N.J. at 284 (citation omitted). "Because of the legislative preference for municipal land use planning by ordinance rather than variance, use variances may be granted only in exceptional circumstances." Kinderkamack Rd. Assocs., LLC v. Mayor & Council of the Borough of Oradell, 421 N.J. Super. 8, 12 (App. Div. 2011). "Therefore, a municipal board of adjustment may permit 'a use or principal structure in a district restricted against such use or principal structure' only where the applicant can demonstrate 'special reasons' for the variance." Ibid. (quoting N.J.S.A. 40:55D-70(d)(1)). "This requirement is known as the 'positive criteria.'" Ibid. (quoting New Brunswick Cellular Tel. Co. v. Borough of S. Plainfield Bd. of Adj., 160 N.J. 1, 6 (1999)).
Our case law recognizes three categories of circumstances in which the "special reasons" required for a use variance may be found: (1) where the proposed use inherently serves the public good, such as a school, hospital or public housing facility; (2) where the property owner would suffer "undue hardship" if compelled to use the property in conformity with the permitted uses in the zone; and (3) where the use would serve the general welfare because "the proposed site is particularly suitable for the proposed use."
[Saddle Brook Realty, LLC v. Twp. of Saddle Brook Zoning Bd. of Adjustment, 388 N.J. Super. 67, 76 (App. Div. 2006) (citations omitted).]
First, plaintiff argues that the proposed use is inherently beneficial, because 20% of the proposed units would be set aside for affordable housing. "The Legislature has defined an 'inherently beneficial use' as one 'which is universally considered of value to the community because it fundamentally serves the public good and promotes the general welfare. Such a use includes, but is not limited to, a hospital, school, child care center, group home, or a wind, solar or photovoltaic energy facility or structure.'" Branchburg, supra, 433 N.J. Super. at 254 (quoting N.J.S.A. 40:55D-4). As the Board here recognized, a project comprised solely of "[a]ffordable housing is an inherently beneficial use." Homes of Hope, Inc. v. Eastampton Twp. Land Use Planning Bd., 409 N.J. Super. 330, 336 (App. Div. 2009) (citing Sica v. Bd. of Adjustment, 127 N.J. 152, 165 (1992) (citing De Simone v. Greater Englewood Housing Corp., 56 N.J. 428, 442 (1970))).
However, here "the predominant use is not the inherently beneficial one." Branchburg, supra, 433 N.J. Super. at 257. In Branchburg, as here, the developer of a proposed multi-unit residential development argued that making approximately 20% of the units "affordable" rendered the entire development an inherently beneficial use. Id. at 251. We held that "although a project including only affordable housing units may be inherently beneficial, the addition of affordable units to a proposed development in which most of the proposed units are market-rate housing does not make the entire project inherently beneficial." Id. at 256. We recognized, as plaintiff argues here, that "[a] developer's ability to build market-rate units undoubtedly facilitates its building of affordable housing financially, and the mixture of affordable and market-rate housing may well provide benefits to the residents of both." Id. at 258. However, we saw "no basis under our current statutory or decisional law to hold that the inclusion of affordable housing as a relatively small component of a much larger residential development transforms the entire project into an inherently beneficial use for purposes of obtaining a (d)(1) variance[.]" Ibid.
Plaintiff tries to distinguish Branchburg, claiming the Borough has an unmet affordable-housing obligation under the FHA. However, the FHA has its own compliance mechanisms, through the regulations promulgated by the Council on Affordable Housing (COAH), and currently in suits by developers seeking a "builder's remedy." See In re N.J.A.C. 5:96 & 5:97, 221 N.J. 1, 7, 26-27, 29, 33-34 (2015). In Branchburg, supra, the trial court "concluded that granting the (d)(1) variance requested by Advance would amount to awarding a builder's remedy through the variance process rather than through the mechanism established by the Fair Housing Act." 433 N.J. Super. at 252. We agreed that "the merits of this case do not turn on the status of the Township's compliance with the Fair Housing Act." Id. at 251 n. 1.
Under the FHA, a "builder's remedy" is "a court imposed remedy for a litigant . . . in which the court requires a municipality to utilize zoning techniques such as mandatory set-asides or density bonuses which provide for the economic viability of a residential development by including housing which is not for low and moderate income households." N.J.S.A. 52:27D-328.
Thus, we reject plaintiff's attempt to distinguish Branchburg. What constitutes an inherently beneficial use is decided based on the criteria of the MLUL, not based on a municipality's compliance or lack thereof with the FHA. In Homes of Hope, supra, we rejected the zoning board's contention "that after a municipality attains its fair share of affordable housing pursuant to the FHA and its concomitant regulations, affordable housing in that municipality is no longer entitled to inherently beneficial use status," under the MLUL. 409 N.J. Super. at 336. We noted that "[a] municipal land use board serves a different function in considering an application for a use variance" than do the FHA's compliance mechanisms. Id. at 339. "A municipality's compliance with COAH regulations does not change the necessary site-specific analysis necessary for a [use] variance." Ibid.
As in Branchburg, "[n]othing in our decision would prevent the [Borough] from deciding to change the zoning in the future to comply with its Fair Housing Act obligations or prevent [plaintiff] from seeking to build on its land in the event it is ultimately found to be entitled to a builder's remedy." Branchburg, supra, 433 N.J. Super. at 251 n.1. Like Branchburg, we rule only that a project, 80% of which is not an inherently beneficial use, is not an inherently beneficial use under the MLUL.
As the trial court noted, at the time of its ruling, the Borough was insulated from builder's remedies because it "had placed itself under COAH jurisdiction." We note that this is no longer the case, due to the subsequent decision in In re N.J.A.C. 5:96 & 5:97, supra.
We reject plaintiff's estoppel claim substantially for the reasons given by Judge Meehan in his October 23, 2014 written opinion. --------
Second, plaintiff argues that even if its proposed use is not inherently beneficial, the proposed site is particularly well-suited for the proposed use. Saddle River Realty, LLC, supra, 388 N.J. Super. at 76. In Price, supra, our Supreme Court "explain[ed] the meaning and intent of the particularly suitable standard in an effort to provide clarity to this important area of zoning law." 214 N.J. at 287. "[P]articularly suitable means that 'the general welfare is served because the use is peculiarly fitted to the particular location for which the variance is sought.'" Ibid. (citation omitted). "[I]n the context of the specific parcel, it means that strict adherence to the established zoning requirements would be less beneficial to the general welfare." Ibid. However, "almost all lawful uses of property can be said to promote the general welfare to some degree, with the result that if general societal benefit alone constituted 'an adequate special reason, a special reason almost always would exist for a use variance.'" Id. at 288 (citation omitted). "As a result, any application for a use variance based on the particularly suitable standard has always called for an analysis that is inherently site-specific." Ibid.
Here, the site is not particularly suited for the proposed use. Plaintiff notes that the site is a larger-sized lot, located between a nursery and single-family homes, and is situated near the downtown and a sewer line. However, the Board found that approximately 40% of the property is a wetland area; one of the proposed buildings would be partially located in "the wetlands transition zone"; and the proposed site plan "would intrude into the wetland buffer." Moreover, the Board found that the remaining lot had "far too little developable land to make it well suited" for twenty-four housing units with forty-six parking spaces. The Board found the project would have "significant" negative impacts on the surrounding single-family homes, where properties are as close as twenty-six feet.
We cannot say that the Board's denial of the application on the basis that the site was not particularly suitable to a multi-family development was arbitrary, capricious or unreasonable. Plaintiff again cites the Borough's need for affordable housing, but that is not a characteristic of the proposed site, and general societal benefit is itself insufficient to constitute an adequate special reason. Ibid.
Third, Plaintiff does not claim on appeal that it would suffer undue hardship if compelled to use the property in conformity with the zone's permitted use, namely single-family homes. Saddle Brook Realty, LLC, supra, 388 N.J. Super. at 76. Thus, the Board properly found plaintiff did not satisfy the positive criteria.
B.
The Board also found that plaintiff's proposed site plan did not satisfy the negative criteria. Where, as here, the proposed use is not inherently beneficial, the applicant must "satisfy the 'enhanced quality of proof' set forth by the Court in Medici." Branchburg, supra, 433 N.J. Super. at 255 (citing Medici v. BPR Co., 107 N.J. 1, 21 (1987)).
"Under Medici, the first inquiry under the negative criteria focuses on the potential effects of the variance on the surrounding properties." Id. at 255. "The board of adjustment must evaluate the impact of the proposed use variance upon the adjacent properties and determine whether or not it will cause such damage to the character of the neighborhood as to constitute 'substantial detriment to the public good.'" Ibid. (quoting Medici, supra, 107 N.J. at 22 n. 12). "Satisfaction of the second prong of the negative criteria analysis normally requires the applicant also 'demonstrate through "an enhanced quality of proof . . . that the variance sought is not inconsistent with the intent and purpose of the master plan and zoning ordinance."'" Ibid. (quoting Smart SMR v. Borough of Fair Lawn Bd. of Adjustment, 152 N.J. 309, 323 (1998)).
The Board permissibly found the proposed twenty-four housing units and forty-six-space parking lots would generate an unacceptable amount of noise, traffic, and light, impacting the adjacent residential neighborhood. Additionally, the Board found that the proposed use would substantially impair the master plan's goals to maintain stability, existing density, and the residential character of the community, and to respect the Borough's environmental features. Plaintiff did not demonstrate that the variance it sought was not inconsistent with the Borough's master plan and zoning ordinances. Ibid. Thus, the Board properly found that plaintiff failed to satisfy the negative criteria.
C.
Finally, plaintiff asserts that the Board's decision was arbitrary, capricious, and unreasonable, because it was based on prejudices against persons qualifying for affordable housing. However, plaintiff cites no prejudicial statements by the Board. Instead, plaintiff cites comments by members of the public, taken out of context. One Borough resident noted: "who knows what these people, what kind of pills or whatever they're going to throw down into the septic system." Another resident speculated that the residents of the proposed development might not properly dispose of their trash in the proposed dumpster. Whether these two resident's concerns were warranted or reflected prejudices, the record provides no indication that they were the opinions of the Board. "'[T]he law presumes that boards of adjustment . . . will act fairly and with proper motives and for valid reasons.'" Stop & Shop Supermarket Co. v. Bd. of Adjustment, 162 N.J. 418, 444 (2000) (citation omitted). Thus, we have no reason to believe that the Board's decision was motivated by prejudice, or that it was otherwise arbitrary, capricious, or unreasonable.
Affirmed. I hereby certify that the foregoing is a true copy of the original on file in my office.
CLERK OF THE APPELLATE DIVISION