Development

In landowner’s action against two Long Island villages alleging that rezoning violated federal and state law, the villages moved to dismiss the claims. The court granted the villages’ motions to dismiss equal protection, due process and some state law claims, but denied the motion to dismiss landowner’s taking claims.
In 2017, landowner purchased a former country club located on the border of three municipalities. The then-applicable zoning regulations would have permitted a development of 284 total single-family homes, 248 in Hempstead, 24 in Woodburgh, and 12 in Lawrence. Landowner filed an application for subdivision approval with the Nassau County Planning Commission, which served as the lead agency for the SEQRA process. Before landowner’s purchase, Hempstead had issued a temporary moratorium on development of golf course properties, a moratorium it extended six times. Later, in 2019 to 2020, the three municipalities entered into an agreement to rezone the property into a Coastal Conservation District, in which permissible development would be reduced from 248 lots to 41 in Hempstead, 24 to 18 in Woodsburgh, and 12 to zero in Lawrence. Landowner then challenged the rezoning on various grounds, but the court dismissed the action without prejudice as unripe. Landowner then applied to the villages of Lawrence and Woodsburgh for variances that would have permitted residential construction in areas where the challenged zoning would prohibit residential development. When the villages denied the applications, landowner appealed the denials. Both appeals were denied. Landowners then brought another action challenging the amendments.

The court first determined that landowner’s claims were now ripe as a result of the variance denial. The court then held that under Lucas v. South Carolina Coastal Council, 505 U.S. 1003, landowner had stated a claim for a categorical taking by the Village of Lawrence because, if landowner’s allegations are true, landowner would be left with no economic use of the property because the only permitted use, as a golf course, has been demonstrated to be not economically viable as a result of the previous operation, which lost over $1 million per year. The court held that even if landowner would be able to build on other portions of the property, Lawrence’s total prohibition within its borders was sufficient to make out a categorical taking claim. The court then held that landowner had also stated a claim for a non-categorical taking against both villages under Penn Central. The court rejected the argument that landowner’s investment-backed expectations would have to be measured against the Hempstead moratorium that was already in place at the time of landowner’s purchase. The court noted that the moratorium was ultimately struck down in state court. The court did, however, dismiss the landowner’s equal protection and due process claims.