Opinion
12-14-2023
In the Matter of BOWERS DEVELOPMENT, LLC et al., Respondents, v. ONEIDA COUNTY INDUSTRIAL DEVELOPMENT AGENCY et al., Appellants.
Goldman Attorneys PLLC, Albany (Paul J. Goldman of counsel), and Cohen Compagni Beckman Appier & Knoll, PLLC, Syracuse, (Laura L. Spring of counsel), for appellants. Fogel & Brown, P.C., Syracuse (Michael A. Fogel of counsel), for respondents. Lippes Mathias LLP, Albany (James A. Shannon and Frank J. Fanshawe of counsel), for, Iroquois Healthcare Association, Inc., amicus curiae. Peter Rayhill, County Attorney, Utica (Andrew Dean of counsel), for County of Oneida, amicus curiae. Harris Beach PLLC, Pittsford (Kyle D. Gooch, Shawn M. Griffin, and Justin S. Miller of counsel), for New York State Economic Development Council Inc., amicus curiae.
Goldman Attorneys PLLC, Albany (Paul J. Goldman of counsel), and Cohen Compagni Beckman Appier & Knoll, PLLC, Syracuse, (Laura L. Spring of counsel), for appellants.
Fogel & Brown, P.C., Syracuse (Michael A. Fogel of counsel), for respondents.
Lippes Mathias LLP, Albany (James A. Shannon and Frank J. Fanshawe of counsel), for, Iroquois Healthcare Association, Inc., amicus curiae.
Peter Rayhill, County Attorney, Utica (Andrew Dean of counsel), for County of Oneida, amicus curiae.
Harris Beach PLLC, Pittsford (Kyle D. Gooch, Shawn M. Griffin, and Justin S. Miller of counsel), for New York State Economic Development Council Inc., amicus curiae. OPINION OF THE COURT
MEMORANDUM.
1062The order of the Appellate Division should be reversed, with costs, the matter remitted to the Appellate Division for consideration of issues raised but not determined by that Court, and the certified question answered in the negative.
Respondent Oneida County Industrial Development Agency (OCIDA) exercised its statutory eminent domain powers to condemn a parcel of property owned by petitioner Rome, Plumbing & Heating Supply Co., Inc., which was the subject of a contract of sale to petitioner Bowers Development, LLC. Respondent Central Utica Building, LLC (CUB) planned to build 1063a medical office building on an adjoining property and requested that OCIDA exercise its authority to take the property so that CUB could build a parking facility that would serve the medical office building during the day, and the public during off-hours. The medical office building itself would be used predominantly to house private, rent-paying doctors’ offices and "other commercial and/or retail tenants to provide complementary services." The remaining portion was to be used as an ambulatory surgery center, also as a paying tenant. OCIDA determined it had the authority to take the property because "the surface parking to be constructed on the … [p]roperty is a commercial use within OCIDA’s statutory authority."
[1] In an EDPL article 2 proceeding for review of the condemnor’s section 204 determination,
"[t]he scope of review is very limited—the Appellate Division must ‘either confirm or reject the condemnor’s determinations and findings,’ and its review is confined to whether (1) the proceeding was constitutionally sound; (2) the condemnor had the requisite authority; (3) its determination complied with SEQRA and EDPL article 2; and (4) the acquisition will serve a public use" (Matter of City of New York [Grand Lafayette Props. LLC], 6 N.Y.3d 540, 546, 814 N.Y.S.2d 592, 847 N.E.2d 1166 [2006], quoting EDPL 207[C]).
"If an adequate basis for a determination is shown ‘and the objector cannot show that the determination was "without foundation," the agency’s determination should be confirmed" ’ (Matter of Waldo’s, Inc. v. Village of Johnson City, 74 N.Y.2d 718, 720, 544 N.Y.S.2d 809, 543 N.E.2d 74 [1989], quoting Matter of Jackson v New York State Urban Dev. Corp., 67 N.Y.2d 400, 418, 503 N.Y.S.2d 298, 494 N.E.2d 429 [1986]; see Long Is. R.R. Co. v. Long Is. Light. Co., 103 A.D.2d 156, 168, 479 N.Y.S.2d 355 [2d Dept 1984], affd 64 N.Y.2d 1088, 489 N.Y.S.2d 881, 479 N.E.2d 226 [1985]).
General Municipal Law § 858(4) grants industrial development agencies the power to "acquire by purchase, grant, lease, gift, pursuant to the provisions of the [EDPL], or otherwise and to use, real property or rights or easements therein necessary for its corporate purposes." "The purposes of [an industrial development] agency are to promote, develop, encourage[,] and assist in the acquiring, constructing, reconstructing, improving, maintaining, equipping[,] and furnishing industrial, manufacturing, warehousing, commercial, research, renewable energy[,] and recreation facilities" (General Municipal Law 1064§ 858). The question here is whether OCIDA appropriately determined that taking the property was necessary for a "commercial" purpose.
[2] As a general matter, a parking facility used by the customers of a profitmaking business plainly has a "commercial" purpose. Petitioners nevertheless argue, and the Appellate Division majority held, that the parking facility was not "commercial" because it was for "hospital" or "health-related facility" purposes (see 211 A.D.3d 1495, 1496, 181 N.Y.S.3d 412 [2022]; cf.1981 Ops Atty Gen 55; 1980 Ops Atty Gen 139). However, the proposed use of the property as a parking facility was not for such purposes. The proposed parking facility functioned simply to satisfy the need for parking created by the medical office building and provide public parking at night. The proposed use did not serve any healthcare-related function. Moreover, though some paying tenants of the medical office building provided healthcare services, the building itself was an office building with space leased out to paying tenants. Even assuming some of its paying tenants could qualify as "hospitals" or "health-related facilities," this would not negate the commercial nature of the office building as a whole (see 211 A.D.3d at 1503, 181 N.Y.S.3d 412 [Curran, J., dissenting]). OCIDA therefore had a rational basis for concluding that the use of the property was for a "commercial" purpose (see Matter of Kaur v New York State Urban Dev. Corp., 15 N.Y.3d 235, 244, 257–259, 907 N.Y.S.2d 122, 933 N.E.2d 721 [2010]; see also Matter of Goldstein v New York State, Urban Dev. Corp., 13 N.Y.3d 511, 526, 893 N.Y.S.2d 472, 921 N.E.2d 164 [2009], citing Kaskel v. Impellitteri, 306 N.Y. 73, 78, 115 N.E.2d 659 [1953]), and its determination was not "without foundation" (see Grand Lafayette Props. LLC, 6 N.Y.3d at 546, 814 N.Y.S.2d 592, 847 N.E.2d 1166).
Given that the Appellate Division did not reach petitioners’ other arguments, we remit to that Court to consider those arguments in the first instance (see J.P. Morgan Sec. Inc. v. Vigilant Ins. Co., 37 N.Y.3d 552, 569, 162 N.Y.S.3d 851, 183 N.E.3d 443 [2021]; Schiavone v. City of New York, 92 N.Y.2d 308, 317, 680 N.Y.S.2d 445, 703 N.E.2d 256 [1998]).
Chief Judge Wilson and Judges Rivera, Garcia, Singas, Cannataro, Troutman and Halligan concur.
Order reversed, with costs, matter remitted to the Appellate Division, Fourth Department, for consideration of issues raised but not determined by that Court and certified question answered in the negative, in a memorandum.