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Foulk v. Zoning Board of Adjustment of the Township of Medford

A-565-99T2 (N.J. Super. App. Div. 2001) (Unpublished)

ZONING; EXACTIONS—Absent a blatant quid pro quo, where there is a variance application that includes an offer to deed-restrict unused land, it is not an improper exaction if the applicant later offers to convey the same land to the municipality for public use.

A gasoline company was the contract purchaser of three contiguous lots at an active intersection within a Highway Commercial Zone. It filed a development application for a use variance and for several bulk variances. It proposed to construct a gas station including a kiosk to be used by employees and to house equipment with a canopy structure over the gasoline dispensation islands and the kiosk. It also proposed to construct a separate structure with a convenience store and a sandwich shop within the convenience store. The gasoline company proposed to retain an existing structure which housed a commercial bakery. Lastly, it intended to cluster its development on approximately twenty-five percent of the site. The zoning board granted the requested use and bulk variance and granted preliminary site plan approval. Several neighboring service stations sought to reverse the board’s judgment by filing suit in the Law Division. One of their objections was that a representative of the applicant had offered to dedicate about 2.3 acres of developable property to the municipality, suggesting that the land would be sufficient for a municipal baseball field. In the alternative, the applicant’s representative proposed a deed restriction preventing any further development. In essence the neighboring service stations argued that the offer to dedicate land to the municipality “impermissibly tainted the approvals granted by the Board.” Their argument was that the applicant (their competitor), only made the offer when it perceived that its application was “in serious peril.” Their theory was that the applicant amended its application to provide that the land would be dedicated to the municipality rather than deed-restricted as initially proposed. Municipal actions based upon exactions obtained by a municipal land use body from an applicant “can be considered nothing other than arbitrary and capricious if the donation was unrelated to any legitimate land use concern, was made by the applicant to induce the land use body to grant an approval, the amount or value of the donation was entirely arbitrary, and was a consideration in the mind of the members of the land use body when they voted the approval. ... If, however, the demand from the land use agency or the offer from the application is made in good faith and is related to legitimate land use concerns generated by the application, and the amount of the contribution is reasonably related to both the costs to be incurred by the municipality and the developer’s respective share thereof, then the offer of a contribution to defray expenses related to the development or the donation of the land for open space will not taint the approval.” The lower court observed that the “Board’s view of this project underwent a perceptible change from unfavorable at the end of the first meeting to favorable at the second hearing to an approval at the third meeting. It recognized that a request for or an offer of a contribution of land, money or a facility is fact sensitive.” Nonetheless, when the lower court examined the record, it concluded that the portion of the land which was the subject of the donation offer had always been considered excess by the applicant. The lower court likened the applicant’s design to a “cluster plan utilized in residential developments which produces areas of undeveloped land.” Consequently, the lower court found nothing improper about making the excess land subject to a deed restriction to prevent its future development. Further, the lower court found that altering the offer to an outright donation of the land to the municipality did not taint the approval. “The only material change that appeared at the second hearing was the manner in which the property would be preserved.” The Appellate Division therefore rejected the objector’s argument that “the idea to restrict development of the excess land emerged only at the second hearing… .” It held that the applicant proposed “at all times to preserve the unneeded land in an undeveloped state. The only thing that changed in this application was the manner by which the land was to be maintained in its natural state.” Consequently, the record did not support a finding that the approval was traded for the open space.

The objectors also claimed that the grant of a variance to allow three principal uses in three structures on one lot was improper. There was no question that each of the uses was separately permissible within the zone and that they could exist on one lot if they were within a shopping center or office park. The board found special reasons to grant the requested use variance relief including that the site was particularly suitable for the combined uses. The objectors, however, argued that the applicant failed to meet the quality of proof standard established in Medici, 107 N.J. at 21-22. “In Medici, the Court imposed an obligation on the applicant to submit an enhanced quality of proof concerning the negative criteria and a further obligation on the Board to make clear and specific findings on this prong.” The Appellate Division, however, hesitated “to apply the strict Medici enhanced quality of proof in a situation in which the use is permitted in the zone.” This is because it held that Medici’s enhanced proof requirement focused on variances with the proposed use is a non-permitted use. To the Court, that was “a markedly different situation” than where a use is permitted by the zoning regulations. Consequently, the Court affirmed the use variance granted by the board.

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