Hillside Terrace, L.P. v. City of Gulfport Mississippi
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IN THE COURT OF APPEALS OF THE STATE OF MISSISSIPPI
NO. 2008-SA-00350-COA
HILLSIDE TERRACE, L.P., A MISSISSIPPI
LIMITED PARTNERSHIP, BY AND THROUGH
ITS GENERAL PARTNER, HILLSIDE
TERRACE I LLC, A MISSISSIPPI LIMITED
LIABILITY COMPANY
APPELLANT
v.
APPELLEES
CITY OF GULFPORT, MISSISSIPPI AND
MARTIN AND DOROTHY MIAZZA
DATE OF JUDGMENT:
TRIAL JUDGE:
COURT FROM WHICH APPEALED:
ATTORNEY FOR APPELLANT:
ATTORNEYS FOR APPELLEES:
NATURE OF THE CASE:
TRIAL COURT DISPOSITION:
DISPOSITION:
MOTION FOR REHEARING FILED:
MANDATE ISSUED:
01/24/2008
HON. STEPHEN B. SIMPSON
HARRISON COUNTY CIRCUIT COURT
PAUL J. DELCAMBRE, JR.
MARGARET E. MURDOCK
DAVID W. CRANE
HARRY P. HEWES
CIVIL - CONTRACT
AFFIRMED DECISION OF THE CITY
COUNCIL
AFFIRMED - 09/29/2009
EN BANC.
LEE, P.J., FOR THE COURT:
¶1.
Hillside Terrace, L.P., (Hillside) by and through its general partner Hillside Terrace
I, LLC, appeals a decision of the Harrison County Circuit Court, which affirmed the decision
of the Gulfport City Council (City Council). The City Council affirmed the decision of the
Gulfport Planning Commission (Commission), which denied Hillside’s application for
approval to construct a 96-unit multi-family dwelling on 6.06 acres in Gulfport, Mississippi.
Hillside appeals and asserts that the circuit court erred in affirming the City Council which
affirmed the Commission’s decision because: (1) the Commission exceeded the scope of its
authority in denying the application; (2) the denial of the application constitutes a taking of
Hillside’s property; and (3) the Commission acted in an arbitrary and capricious manner, as
its decision is not supported by substantial evidence. Finding no reversible error, we affirm.
FACTS
¶2.
In December 2006, Hillside filed an application with the Commission, seeking
approval to construct a multi-family housing development utilizing low-income housing tax
credits. Hillside requested permission to build the development on land that it owns, which
is situated along Pass Road within the city limits of Gulfport. The proposed location is
adjacent to a gift shop owned by Martin and Dorothy Miazza and an existing apartment
complex.1 The land is situated within a B-2 district, which is designated as a general
business district pursuant to Gulfport’s Comprehensive Zoning Ordinance.2 As a result,
1
The Miazzas appeared before the Commission and objected to the approval of
Hillside’s application.
2
According to the zoning ordinance, B-2 districts are general business districts that
are:
composed of land and structures occupied by or suitable for uses furnishing,
in addition to the retail goods and services supplied by the neighborhood
business districts, the wider range of retail goods and services required by
residents of a group or community of neighborhoods, and by the city
generally. Usually located on a thoroughfare or highway or near the
intersection of principal thoroughfares or highways, these districts are large
and within convenient distance of the area they serve. The district regulations
are designed to permit the development of the districts for their purpose in a
spacious arrangement of uses and structures. To protect the abutting and
2
approval must be obtained from the Commission before the land may be used for residential
purposes.
¶3.
The planning staff issued a staff report that recommended approval of Hillside’s
application, with the following conditions: (1) “[a] Planned Building Group will be required
for this development if there are going to be multiply [sic] building[s] that are not
connected,” and (2) “[t]here is [an] AE flood zone located on the northern portion of the
propose[d] development. If this area is going to be used in the development, the applicant
will need to schedule a meeting with the Flood Plain Administrator to discuss possible
changes in the required BFE (base flood elevation).” The Commission held a public hearing
on January 11, 2007, and despite the planning staff’s recommendation, voted to deny
Hillside’s application. Then, Hillside appealed to the City Council, which affirmed the
Commission’s decision during its March 20th meeting. On March 29, 2007, Hillside filed
a notice of appeal to the Harrison County Circuit Court, which affirmed the City Council’s
decision.3 It is from this decision that Hillside now appeals.
¶4.
Additional facts, as necessary, will be related during our analysis and discussion of
the issues.
ANALYSIS AND DISCUSSION OF THE ISSUES
surrounding residential areas, certain requirements are placed on uses. It is
intended that additional general business districts will be created, in
accordance with the amendment procedure of this ordinance, as they are
needed to serve groups of new neighborhoods or the city generally.
3
The Miazzas filed a motion to intervene in this matter on August 23, 2007.
Thereafter, the Harrison County Circuit Court issued an agreed order, and the Miazzas were
allowed to participate as advocates for the City from that point forward.
3
¶5.
In Town of Prentiss v. Jefferson Davis County, 874 So. 2d 962, 964 (¶6) (Miss. 2004)
(citing Hooks v. George County, 748 So. 2d 678, 680 (Miss. 1999)), the Mississippi Supreme
Court held that “[u]nlike decisions to zone or re-zone, which are legislative in nature,
decisions on request for special exceptions are adjudicative, and a reviewing court subjects
such decisions to the same standard as is applied to administrative agency adjudicative
decisions.” Therefore, the “decision of an administrative agency is not to be disturbed unless
the agency order was unsupported by substantial evidence; was arbitrary or capricious; was
beyond the agency’s scope or powers; or violated the constitutional or statutory rights of the
aggrieved party.” Id.
¶6.
Hillside argues that the circuit court erred in affirming the decision of the City Council
because the Commission, in denying Hillside’s application, went beyond the scope of its
power in two respects. First, Hillside asserts that the Commission’s “decision was based
mostly on expected drainage issues and was not based on the criteria called for in the City’s
Comprehensive Land Use Ordinances.” Hillside points us to appendix A, section III(J)(1)(b)
of the land-use ordinances, which reads as follows:
Uses requiring planning approval. The uses listed below are permitted upon
approval of location and the site plan thereof by the planning commission as
being appropriate with regard to transportation and access, water supply, waste
disposal, and other public facilities, as not causing undue traffic congestion or
creating a traffic hazard, and as being in harmony with the orderly and
appropriate development of the district [in] which the use is located.
Hillside asserts that “[n]oticeably absent from the ordinance is any power granted to the
Planning Commission to base its decision to deny the use of any property on technical
engineering concerns such as drainage.” Thus, according to Hillside, the Commission
4
exceeded the scope of its power when it allowed the drainage issue to become a factor in its
decision to deny Hillside’s application.
¶7.
It is undisputed that a portion of the tract of land encompassing the building site is
located in a flood zone, although not in a HUD designated flood zone. During the hearing
before the Commission, Hillside’s engineer testified that, although the project would likely
experience technical issues later in the process, drainage issues would be addressed and
resolved as the process moved forward.
¶8.
John Boyd, vice-president of Realtex Development Corporation (Realtex), the
company involved in constructing the development, testified that they sought a use approval,
rather than a rezoning, to provide affordable quality apartments for low-income families.
Boyd explained that this development would replace apartment complexes that were
destroyed by Hurricane Katrina. He acknowledged that they must address the drainage
issues and assured the Commission that Realtex would comply with the Federal Emergency
Management Agency’s (FEMA) advisory base flood elevations. Boyd also stated that
Realtex would conduct a drainage study. As for the affordability aspect of the multi-family
development, Boyd stated that the residents must have a verifiable income of at least two and
a half times the rent.
¶9.
David Crane, attorney for the Miazzas, was also present at the hearing and spoke
against the Commission’s approval. He stated that the Miazzas’ objections were based on
the following reasons: (1) there is currently an apartment complex to the left of their gift
shop; (2) an additional multi-family development will bring increased traffic; and (3) the
water supply and fire and police protection will need to be increased. Also, Crane noted that
5
traffic along Pass Road is already congested, as there is a school across the street from their
business, an apartment complex adjacent to their building, and a grocery store in close
proximity to their building. Further, according to Crane, the Miazzas believe that the
proposed project will engender “an atmosphere for the cultivation of crime.”
¶10.
Hillside argues that the Commission should not have considered the drainage issue
because the Commission lacks the expertise and technical training necessary to do so. In
Board of Aldermen of Town of Bay Springs v. Jenkins, 423 So. 2d 1323, 1327 (Miss. 1982),
our supreme court held that it was proper for the Mayor and the Board of Aldermen to “call
upon their own common knowledge and experience” and to consider statements from
landowners in rendering a municipal order. The Jenkins court found that:
It is manifest that the Mayor and Board took into consideration all statements,
both sworn and unsworn, and their common knowledge and familiarity about
their small municipality, in reaching their decision. We believe this method
to be sound and practical, and courts should respect such findings unless they
are arbitrary, capricious, and unreasonable.
Id. at 1327-28.
¶11.
Commission member Claudia Keyes testified during the hearing that the Commission
had denied a proposed project on this particular land two years prior because of flooding.
Further, Keyes noted that Brickyard Bayou is located behind the property.
Also,
Commission member Lutillie Stepney testified that he is familiar with the property and stated
unequivocally that the property “is going to flood.”
¶12.
Based on the holding in Jenkins, we conclude that the Commission did not exceed the
scope of its authority when it considered the drainage issue.
¶13.
As for Hillside’s contention that the Commission’s decision is based mostly on
6
drainage, we note that the record clearly reflects that the Commission considered several
factors, in addition to drainage. This is evidenced by the following comments made by Crane
during the hearing:
Now, he said they’re simply asking for use approval. Your zoning ordinance
allows for multi[-]family development in a B-2 zone only if -- if and only if the
planning commission gives use approval or there might be an exception, they
might say it’s allowed here. If you look back in the transcript of this matter,
there was a discussion of a hundred plus multi-family units already located
almost immediately adjacent to the property. I don’t know if any of you are
familiar with the location of my client’s property, Martin Miazza’s Fine Gifts.
They are on the corner of Pass Road where 29th Avenue intersects Pass Road.
That intersection is not a perpendicular intersection. It’s a very steep angle.
And it’s actually kind of dangerous to drive in and out of there because in
order to get out of the parking lot of Martin Miazza’s, you’ve got to get on
29th then on Pass Road immediately. Immediately to the east of -- west of the
Miazzas’ property is one residence, and then there’s a driveway for the
(inaudible) multi-family complex. It goes behind the Miazza property and
comes back, and it abuts the property in question. It’s clearly over 100 multifamilies. It is partially vacant. It is for the most part vacant right now, as it
did, indeed, flood during Katrina. Now, this is how our appeal is based on
speculation that the sole reason of the planning commission’s denial was for
drainage and flooding. Now, I’m not going to concede that that goes beyond
the planning commission’s purview. However, there are certain factors in
considering a special use request like this that they’ve got to consider.
Transportation and access, traffic congestion and hazards, harmony with the
orderly and appropriate development of the district, fire protection, and also
any other public facilities that will be tasked. So I would suggest to you that
drainage is certainly an issue that would task public facilities if, in the event
that a plan was accomplished and built there, they caused drainage problems.
Thus, because the Commission considered potential problems with traffic congestion, police
and fire protection, and crime, we cannot conclude that the Commission’s decision to deny
Hillside’s application was “arbitrary, capricious, discriminatory, illegal, or without a
substantial evidentiary basis.” Accordingly, we find no merit to this issue.
¶14.
Second, Hillside asserts that the Commission exceeded its authority in inquiring,
7
during the hearing, about the financial viability of the project, exploring its method of
financing the project, and its rental-rate structure. Specifically, Hillside argues that its
involvement with Realtex and the Mississippi Regional Housing Authority VIII (MRHA)
coupled with the fact that the project would be financed using low-income tax credits “played
a significant role in the Planning Commission’s denial.”
Hillside contends that the
discussion centered around who would be tenants.
¶15.
Our review of the record reveals that the Commission considered testimony regarding
the income requirements of the applicants, along with issues such as the likelihood of an
increase in crime and the need for increased fire and police protection. However, there is
nothing in the record which suggests that the Commission gave undue consideration to the
fact that the project was to be financed using low-income tax credits. Thus, we conclude that
the Commission properly considered all of the issues concerning Hillside’s project. This
issue lacks merit.
¶16.
Third, Hillside asserts that the Commission’s denial constitutes a taking of its property
and directs our attention to Tippitt v. City of Hernando, 909 So. 2d 1190, 1194 (¶14) (Miss.
Ct. App. 2005) (quoting Walters v. City of Greenville, 751 So. 2d 1206, 1210 (¶19) (Miss.
Ct. App. 1999)) which defines a taking as follows:
There is a taking of property when government action directly interferes with
or substantially disturbs the owner’s use and enjoyment of the property.
Brothers v. U.S., 594 F.2d 740, 741-42 (1979). A taking is effected if the
application of a zoning law denies a property owner of economically viable
use of his land. This can consist of preventing the best use of the land or
extinguishing a fundamental attribute of ownership. Vari-Build, Inc. v. City
of Reno, 596 F. Supp. 673, 679 (1984).
¶17.
According to Hillside, the Commission would refuse to approve any use of the
8
property and points to the Commission’s denial on a prior occasion to support its contention.
Keyes stated the following at the commission meeting:
[T]his very property has been before us as recent as two years ago. And we
denied it. And you know why we denied it? Because it floods. Brickyard
Bayou is right behind that. So we denied it for I believe it was like a
campground just so recently as two years ago. So I can’t really see, you know,
houses that can’t go on wheels moving out of there, so, you know, I wouldn’t
think that this would be the place that you’re really looking for.
We note that one of the owners of the property testified at the City Council meeting and
vigorously denied Keyes’s claim that an application had been denied two years prior.
Nevertheless, Hillside now argues that the Commission did just that. Further, Hillside does
not point to anything in the record to support its argument that the Commission would not
approve the property for any of the permitted uses that required the Commission’s approval.
As evidenced by Keyes’s comments quoted above, the opposite is true. She intimated that
other projects would likely be approved for this property, e.g., mobile homes. Therefore, we
find no merit to this issue, as Hillside has failed to prove that it was denied “economically
viable use of its land.”
¶18.
Finally, Hillside asserts that the Commission’s decision was arbitrary and capricious
and not supported by substantial evidence. Hillside contends, again, that the Commission
based its decision on “past drainage issues without reviewing or offering evidence to support
its finding of infeasibility.” We disagree. The engineer for the project, Craig Carney,
testified at the City Council meeting and explained the measures that would be undertaken
in order to prevent any potential drainage issues and to ensure that the property does not
flood. Further, as stated, two Commission members testified that the property is highly likely
9
to flood. Specifically, Stepney stated the following:
This property here, I’ve been across it since back in the sixties. And I’m
telling you, it’s going to flood. Just the other week, the rain we did have, it
had about eight or ten (inaudible). This property here, like she just told you,
we had this before, I know because the property just down below, the school
where my wife works, and when it rains, you can’t stop it.
Obviously, the Commission was not convinced that the development will not flood or will
not have other drainage issues in the future. We cannot find the circuit court in error for
affirming the City Council which affirmed the Commission’s decision to deny Hillside’s
application. There is no merit to this issue.
¶19. THE JUDGMENT OF THE HARRISON COUNTY CIRCUIT COURT IS
AFFIRMED. ALL COSTS OF THIS APPEAL ARE ASSESSED TO THE
APPELLANT.
GRIFFIS, BARNES AND ROBERTS, JJ., CONCUR. IRVING, J., DISSENTS
WITH SEPARATE WRITTEN OPINION JOINED BY KING, C.J., MYERS, P.J.,
AND CARLTON, J. ISHEE AND MAXWELL, JJ., NOT PARTICIPATING.
IRVING, J., DISSENTING:
¶20.
The majority finds that the circuit court did not err in finding that the decision of the
Planning Commission (Commission) and of the City of Gulfport, acting through its Council
(City Council), to deny Hillside Terrace, L.P.’s application for approval to construct a multifamily dwelling in a B-2 district zone is supported by substantial evidence and is not arbitrary
and capricious. I disagree. In my judgment, the evidence is overwhelming that not only is
the decision to deny approval not undergirded by substantial evidence, it is also arbitrary and
capricious, because the Commission and the City Council wilfully and deliberately ignored
the provision in the zoning ordinance which sets forth the factors that must be considered in
determining whether to grant or deny approval for a permitted use in a B-2 district.
10
Therefore, I dissent. I would reverse and render the judgment of the circuit court and remand
this case to the Commission with directions to grant approval to Hillside for construction of
the multi-family dwelling complex.
¶21.
First, it should be made clear that, according to the City’s “Comprehensive Land Use
Ordinances,” multi-family dwellings are a permitted use in a B-2 district. The use, however,
requires approval of the Commission. It does not require rezoning or any type of special
exception. When considering whether to allow a permitted use, the Commission is required
to consider certain factors.
Specifically, appendix A, section III(J)(1)(b) of the
Comprehensive Land Use Ordinances provides, in pertinent part, as follows:
Uses requiring planning approval. The uses listed below [of which multiple
family dwellings in a B-2 zone are one] are permitted upon approval of
location and the site plan thereof by the planning commission as being
appropriate with regard to transportation and access, water supply, waste
disposal, and other public facilities, as not causing undue traffic congestion or
creating a traffic hazard, and as being in harmony with the orderly and
appropriate development of the district [in] which the use is located.
Thus, it is also clear that the determination to approve or disapprove a permitted use cannot
be done in a whimsical, arbitrary, or capricious fashion. It must be the result of a deliberate,
adjudicative process by the Commission considering the impact of the use on “transportation
and access, water supply, waste disposal, and other public facilities, as not causing undue
traffic congestion or creating a traffic hazard, and as being in harmony with the orderly and
appropriate development of the district [in] which the use is located.” (Emphasis added).
¶22.
It is noteworthy here that none of the departments of the City of Gulfport that would
be potentially impacted by permitting the construction of the multi-family dwellings
11
recommended against it, choosing instead to offer no comment.4 In fact, one, the fire
department, gave its approval, conditioned upon the development meeting all requirements
applying to multi-family dwellings. The police department made no recommendation but
had “concerns regarding access of traffic to Pass Road.” It, however, was of the opinion that
“proper management and security of the complex will alleviate other law enforcement
concerns.” With respect to the matter of “access of traffic to Pass Road,” it is sufficient to
say that under the ordinance, for a development of the size that was proposed, only one
entrance is required.
¶23.
I am fully aware that neither the Commission nor the City Council was bound by the
lack of opposition from the various departments of city government. However, it seems to
me that lack of opposition is highly relevant to the question of whether the Commission’s and
the City Council’s decisions are based on substantial evidence or are arbitrary and capricious.
It is not legitimately debatable that the personnel in the department of traffic and safety
should possess more expertise than a commissioner or councilperson relative to the impact
that existence of the dwelling units would have on traffic congestion or traffic hazards. The
same would be true of the department of public works with respect to its knowledge of the
impact that the development might have on the water supply and waste disposal facilities of
the city. Yet, as stated, neither of the departments recommended against approval. With
respect to the use being “in harmony with the orderly and appropriate development of the
district [in] which the use is located,” the Commission’s own staff found:
4
According to the Commission’s staff report, the departments of engineering, public
works, traffic and safety, and building codes services made no comment.
12
After reviewing the submitted information, it was determined the proposed
apartment development would be consistent with the surrounding areas. There
is another apartment complex located west and north of the subject property.
This proposed development will potentially provide a transition and buffer
area between the single family residents located to the west, and the
commercial developments located on Pass Road and 8th Avenue.
The Commission’s staff recommended that approval be granted on certain conditions that,
for purposes of this discussion, are irrelevant, except for the recommendation that if the
northern portion of the development was going to be used, Hillside would need to schedule
a meeting with the Flood Plain Administrator to discuss possible changes in the required base
flood elevation.
¶24.
John Boyd, vice-president of Realtex Development Corporation (Realtex), the
company involved in constructing the development, testified that they sought a use approval,
rather than a rezone, to provide “affordable quality apartments for hardworking families.”
Boyd explained that this development would replace apartment complexes that were
destroyed by Hurricane Katrina. He acknowledged that drainage issues would need to be
addressed and assured the Commission that Realtex would comply with the Federal
Emergency Management Agency’s (FEMA) advisory base flood elevations. Boyd also
stated that Realtex would conduct a drainage study. As for the ability of the tenants to afford
the rent that would be required, Boyd stated that the residents must have a verifiable income
of at least two and a half times the rent.
¶25.
The proposed location is adjacent to a gift shop owned by Martin and Dorothy Miazza
and an existing apartment complex. They appeared before the Commission through their
attorney, David Crane, and argued against approval of Hillside’s application. I quote,
13
verbatim, portions of his presentation to the Commission:
So [the] B-2 district is designed to create a retail business district to service the
community. It is not designated to service multi-family residential housing.
It is not designed to service residential housing at all.
However, in your code and in your wisdom, you put in there that somebody
could apply for permission to build a multi-family complex within the B-2
district. They did that once, and they put in Cypress Lane, 100 units.
Now, somebody is coming in and asking to do it again, and they’re saying
because it’s been done before, it should be done again. And I’m going to tell
you, that’s the opposite reason that is true. Because it’s been done before, you
should look with a particularly jaundiced eye at doing it again because what
you would, in fact, do is convert this neighborhood from a B-2 district,
business retail district, and sandwich my clients in between two huge multifamily residential complexes.
Now, they’ve been there for 40 years. They bought in a B-2 general business
district. Their expectations which were completely justified were to have a
business that would thrive in a neighborhood that would be general retail
businesses. Their business is not going to fly if it’s sandwiched between two
residential complexes, not as it would if somebody came in next door and put
another retail business. And that’s what the district is designed to do.
So I don’t think that you can arbitrarily say just because an apartment complex
is there now you can put another one because it would, in effect, be tantamount
to changing the district, at least where the Miazza stand, from B-2 to R-2. And
that’s not what they bought forty years ago.
But in addition to that, your zoning ordinance dictates several factors that you
should consider when considering a conditional use under the existing district.
One is transportation and access. The second is water supply, water
(inaudible), fire and police protection, traffic congestion or hazards, and in
harmony with an orderly and appropriate development of the district.
I’m just going to go by a couple of these, and then start with transportation and
access, traffic congestion, and hazards.
****
Okay. This property is located immediately adjacent to the intersection of 29th
14
Street and Pass Road. That intersection is not a perpendicular intersection. It
comes at a very sharp angle. It’s extremely dangerous right now to come in
and out of 29th, quite frankly, to get onto Pass Road.
But in addition to that, you’ve got one access going into that apartment
complex. They’re asking for permission to build 96 units and 172 parking
spaces. So you can assume at least 172 parkers coming in and out of that place
on a daily basis.
You’ve got a school across the street, school zone twice a day, and you’ve got
a grocery store that has no defined ingress or egress going in and out of Pass
Road that is already a congested traffic hazard.
By allowing this to go in, you’re just going to augment the problem that
already exists with regard to traffic.
And there is too much limited access. You just went through a seminar on
smart growth. One of the things I’m sure they told you is that you would have
multiple access. What they’re trying to do is build an island community unto
itself, one entrance, nothing else but high density apartment living. It’s a no
mixed use with this whatsoever. There’s no access from one place to the
other. And, in fact, it’s just limited to that single entrance coming off of Pass
Road.
I’ve already spoken about the harmony with the orderly and appropriate
development of the neighborhood.
The Miazzas bought this property 40 years ago. They have justified
expectations to have it as a business district. Quite frankly, if you took that
away from them, that would be tantamount to taking their property without any
compensation under the Fifth Amendment.
But then last but not least, fire and police protection. And this addresses the
crime issue. And I know that they’re telling you that this is not subsidized
housing. Nonetheless, they’re talking about voucher housing. And I can tell
you that the voucher program is designed so that you can scatter that
subsidized housing throughout the community rather than cluster it in high
density living. The reason is, is when you live in a high density low income
environment, unfortunately, it engenders an atmosphere for the cultivation of
crime. Nobody wants that, and that’s nobody’s intention when they go in. But
if you look at the projects in New Orleans, you look at the projects that we’ve
had here, you see a high density of crime in those neighborhoods.
15
The logical reason is quite sociological. If you’re an eight-year-old, and you
see nothing but poverty around you and nothing but crime around you, you
have no desire to go out and do something better for yourself.
If you take a voucher, and you go live across town, and you live with people
who do have maybe a little different set of values than the people you’re living
next door to, you see an opportunity for growth and an opportunity of escape.
There will be no such opportunity in this complex. People are going to live,
and they’re going to see crime, and they’re going to create crime. I think it’s
an unfortunate truth, but it is.
In addition to his oral argument to the Commission, Crane presented a letter which
summarized his argument regarding three of the factors to be considered by the Commission:
(1) transportation and access/traffic congestion and hazards, (2) harmony with the orderly
and appropriate development of the district, and (3) fire and police protection.
¶26.
No other person or entity spoke against approval. Thereafter, various commissioners
weighed in with questions for Boyd:
[STEPNEY]:
This property here, I’ve been across it since back in the
sixties. And I’m telling you, it’s going to flood. Just the
other week, the rain we did have, it had about eight or ten
(inaudible). This property here, like she just told you, we
had this before, I know because the property just down
below, the school where my wife works, and when it
rains, you can’t stop it.
****
Don’t get me wrong. I am not fighting the government.
That particular property in there, I just can’t see it, I’ll be
frank with you. I’m not fighting your proposal. I want
you to find -- I’d like you to maybe try to find
somewhere else where you can really go ahead and try to
put up a good . . . .
But that property there, no I just can’t see it.
16
****
[BOYD]:
T epo lmi,y ud n thv a a u dne- y ucranyd nthv a a u dneb ty uhv vr fwz ndm lifml . An I
h r be s o o o a e n b n a c - o eti l o ’ a e n b n a c u o a e ey e o e ut-a iy d
suggest to you that no one here is listening to the hardworking families who need a place to
live.
[KEYES]:
We’ll take exception to that, sir.
[STEWART]:
Yes.
[ALLEN]:
Okay. Let’s deal on this hardworking family. The income
restrictions. Is there a minimum and maximum, or just a
maximum?
[BOYD]:
There is a maximum. On the minimum side, you must have an
income of at least two and half times the rent. There’s a
maximum by HUD, but there’s an internal screening criteria that
the family must have an income two and a half times the
monthly rent.
[ALLEN]:
So basically they can have an income of less than a thousand
dollars a month.
[BOYD]:
For the one bedroom, the lowest, the three hundred fifty-four,
yes, two and a half times.
[ALLEN]:
And I’m not speaking -- I’m just trying to get . . . . When we
say income, is that income from --
[BOYD]:
Verifiable income from employment.
[ALLEN]:
Are we talking Social Security, unemployment, welfare? What
are we calling income? Because you used the term hardworking
families, so let’s clarify what we’re describing as income.
[BOYD]:
Verifiable income. I would suggest to you that a family on
disability, that can be shown as income. Section VIII vouchers
don’t show up as income, but the resident has to make up the
gap between what the voucher is and the rent.
[ALLEN]:
You consider verifiable income anything they have coming in;
right?
17
[BOYD]:
[ALLEN]:
Okay. Thank you.
[BOYD]:
The situation we’re in tonight is I would propose that you put
conditions on the use approval that the drainage is all worked
out through the planned building.
[ALLEN]:
That’s a given anyway. You aren’t going to get a building
permit unless you work the drainage out.
[KEYES]:
¶27.
No gifts. Other than that, generally, yes.
But let us say this after hearing Lorraine [Santo]. We do
appreciate your presence, and we hope that we can
accommodate you in some way. However, we must say, you
know, that again this is not the place. And it’s not because of
you. It’s the area. What you’re building, you know, that sounds
fabulous according to Lorraine, and we trust that that particular
piece of property is not the property that you really want. We
know that. We’ve already seen that property.
Thereafter, the Commission members, without any discussion of any of the factors
that are, by the express provisions of the ordinance, required to be considered, denied
approval by a vote of four to two. As stated, section III(J)(1)(b) of the land use ordinance
requires that the Commission consider “transportation and access; water supply; waste
disposal; and other public facilities, as not causing undue traffic congestion or creating a
traffic hazard; and as being in harmony with the orderly and appropriate development of the
district which the use is located.”
¶28.
Based on these facts, I would find that there is a lack of substantial evidence to
support the Commission’s refusal to grant permission for the development of the multifamily dwelling complex in the B-2 district.
Therefore, I would also find that the
Commission’s denial of Hillside’s request is arbitrary and capricious.
¶29.
I would also find that the City Council, which affirmed the Commission’s decision,
18
acted without substantial evidence to support its decision, as its decision was based on the
record developed before the Commission, even though the City Council heard arguments
from interested parties, including Hillside’s and the Miazzas’ attorneys. Thereafter, various
councilpersons commented on Hillside’s request for permission to develop the multi-family
dwelling complex:
[NALLEY]: Thank you, Mr. Chair. I won’t subject everyone in here to a
dissertation on tax credits, because I think most of you probably
(inaudible, train passing).
However, since it was brought up by the first gentleman who
spoke and also in Mr. Reilly Morse’s letter to us, I just would
like you to know that my intention is not to stop housing-credit
projects altogether. It was listed in this letter [that] halting
affordable housing developments is not the solution to the
prevailing housing shortage, and you are correct. But let me tell
you a little bit about Barbara Nalley. I was raised on a farm two
miles down a dirt road in a farm house with no indoor plumbing
until I was 13 years old. My grandparents lived in projects all
of their entire life. My mother was raised there. My aunt raised
her children there. I visited my grandparents every Sunday in
the housing projects in a small town in Georgia.
I have sympathy for all of those who are less fortunate than me.
However, what’s happening under the GO Zone is something
totally different than what happens under annual tax credits each
year. It is like a feeding frenzy. Under the last round, 1,071
units were approved in Gulfport for 12 developments for a
period ending February 15. On the current round ending March
9, 14 applications were applied for in the city of Gulfport for
1,954 units. Six applications on the city infrastructure, burdens
on our streets, 860 units.
Under this same application ending 3/9/07, only four applied for
in Biloxi, three in Ocean Springs, five in Bay St. Louis, one in
D’Iberville, four in Waveland, three [in] Pass Christian, one in
Long Beach, one in Gautier, [and] one in Moss Point.
My efforts are not to stop affordable housing or Section 8
19
housing. My efforts are to under this GO Zone to perhaps
implement a better policy with the Home Corp. under this next
round of development.
And we were told in a meeting that we had yesterday why not
just basically -- and I’m paraphrasing -- if we go ahead and
approve these, then we as a council when it gets times like this
or permitting, we will have the ability to say no. And my
objection to that is obviously we haven’t.
We have another development that was brought before the
planning commission. They were denied for reasons of location.
They were brought to us. It was denied for reasons of location
being close to a creek bed, close to an interstate, close to a
shopping mall that is projected to go in. And although it was
denied both times, it’s being brought back to planning again.
So I wonder if we have the ability to say no. Do we need 26 in
the city of Gulfport? Is that saturation?
And I know that you’re going to sit out there, gentlemen, and
say we probably won’t get all of these 14. We may not. But I
ask [sic] the Home Corp., and they certainly are within their
rights to approve them all should they choose to do so.
Saturation. It’s going to affect our taxes. It’s going to affect our
schools. It’s going to affect everything around us if we have this
many. I’m not trying to stop them all.
I have concerns with this project in particular because of the
location and because of the transcript. And I know where the
location is. I am concerned about putting a housing unit there
which is so close where the buyout [sic] was.
People have talked to me. I’ve asked questions. I’ve driven by
there. My concerns are not whether we appear in the paper
tomorrow as being the first to award a tax credit development
because I can tell you, I’ve got one on O’Neal Road called
O’Neal Housing, which is very near where I live. And it is a
good project. And currently it is an active project which wasn’t
damaged.
Do I have a problem with the federal government closing down
20
some of our current housing projects which are fine buildings
where people are in brick structures, there is space, they have
yards to play in, to sell that property and relocate them to an
apartment complex on a creek bed near the interstate? Yes, I
have a problem with that.
So do we depend on our federal government to guide us? No,
I don’t think we do.
In a given year as a tax credit, the State of Mississippi receives
$5 million approximately, and gets 30 applications from across
the state. Under GO Zone, that equates to about $37 million a
year over three years which is close to over $120 million. That
is excessive.
I would like to see it spread more evenly amongst the other
cities. I am asking Home Corp. to do that. And I thank you for
your indulgence, Mr. Chairman.
****
[HOLMES-HINES]:
This is going to be for [the Director of Urban
Development,] Larry Jones. Larry, in looking at
the transcript, comments by department agencies,
engineering, public works, traffic and safety, and
building code services is left blank.
Fire
department makes a comment that they approve
as of memo stated in the record for multi-family
dwelling.
The police department is no
recommendation, memo of 1/3/07, but there are
concerns regarding access to traffic to Pass Road.
Additionally, proper management and security of
the complex will alleviate other law enforcement
concerns.
My question is: Did these departments submit
their comments on this project?
MR. JONES:
No, they did not.
****
[NALLEY]: Can you tell me what the elevation of the property is now?
21
[ENGINEER CRAIG CARNEY]:
It’s about 8 to 20 feet.
[NALLEY]: Can you tell me how much water you had in Katrina on the
property or can the property owner tell me?
[DR. LOVELL]:5
We’ve got the FEMA map if you would like to see that.
[NALLEY]: No. I’d like you to tell me approximately how much -- you said
that you had water during Katrina. Can you tell me about how
much water you had?
[DR. LOVELL]:
Approximately one-third of the property, according to
the FEMA map.
[COUNCIL MEMBER NALLEY]:
[DR. LOVELL]:
On which side of the property?
North.
[NALLEY]: And how close are you to the existing apartment complex up
there?
[DR. LOVELL]:
Which one?
[NALLEY]: The one that’s on, I’m assuming to the west.
[DR. LOVELL]:
The property complex to the west is -- the correct name
is the Cypress Lane Apartments to the west there. What
was your question?
[NALLEY]: How many apartments are in that complex to your west
approximately?
[DR. LOVELL]:
I’m not sure. Maybe 100, 120.
[NALLEY]: Are they now rebuilding that complex?
[CONCERNED CITIZEN]:
Yes.
[NALLEY]: I know when it came before the planning commission, they were not.
Are they now?
5
Dr. Frank Lovell is one of the owners of the property.
22
[CARNEY]: I’m not sure of the exact status or the extent that they’re
rebuilding or how many units they intend to salvage.
[NALLEY]: Okay. Thank you, Mr. Chairman.
****
[HOLMES-HINES]:
Mr. Carney, I have a copy of the (inaudible) that
mentions about your flood zone. There are two
different flood zones in this transcript. And it
stated here that the applicant will need to schedule
a meeting with the floodplain administrator to
discuss possible changes in the required ABFEs.
Do you know today what your elevation will be in
this area?
[CARNEY]: It’s 16. The ABFE is 16. We’ll be going a foot above that. In
some areas, we’ll be three feet above that.
Well, as you go south the land gets higher. So the finished floor
elevations are at elevation 20 as you go south closer to Pass
Road. As you go further north, the finished floor elevation is
17.
[HOLMES-HINES]:
¶30.
Thank you, sir.
As was the case with the Commission, at the conclusion of the presentations made by
the attorneys for Hillside and the Miazzas and the comments and questions from
councilpersons, the councilpersons, without discussion, voted to affirm the decision of the
Commission. Also, as was the case with the commissioners, none of the questions or
comments of the councilpersons, as reflected above, were targeted at the factors, set forth in
the ordinance, which determine the propriety of granting or denying the request.
¶31. In Town of Prentiss v. Jefferson Davis County, 874 So. 2d 962, 964 (¶6) (Miss. 2004)
(citing Hooks v. George County, 748 So. 2d 678, 680 (Miss. 1999)), the Mississippi Supreme
23
Court held that “[u]nlike decisions to zone or re-zone, which are legislative in nature,
decisions on request for special exceptions are adjudicative, and a reviewing court subjects
such decisions to the same standard as is applied to [an] administrative agency adjudicative
decisions.” Therefore, the “decision of an administrative agency is not to be disturbed unless
the agency order was unsupported by substantial evidence; was arbitrary or capricious; was
beyond the agency’s scope or powers; or violated the constitutional or statutory rights of the
aggrieved party.” Id.
¶32.
Our supreme court has defined the phrase “arbitrary and capricious,” as follows:
An act is arbitrary when it is done without adequately determining principle,
not done according to reason or judgment, but depending upon the will alone,
— absolute in power, tyrannical, despotic, non-rational, — implying either a
lack of understanding of or a disregard for the fundamental nature of things .
. . [.] An act is capricious when it is done without reason, in a whimsical
manner, implying either a lack of understanding of or disregard for the
surrounding facts and settle controlling principles.
Lowe v. Lowndes County Bldg. Inspection Dep’t, 760 So. 2d 711, 713 (¶11) (Miss. 2000)
(quoting Miss. State Dep’t of Health v. Sw. Miss. Reg’l Med. Ctr., 580 So. 2d 1238, 1240
(Miss. 1991)). In Lowe, our supreme court also provided guidance for determining when an
agency has acted in an arbitrary and capricious manner. Id. In doing so, the Lowe court
discussed its holding in Mississippi Department of Environmental Quality v. Weems, 653
So. 2d 266 (Miss. 1995) wherein it noted that the Mississippi Department of Environmental
Quality “acted arbitrarily and capriciously by failing to follow clear statutory directives . .
. .” Lowe, 760 So. 2d at 713 (¶12). The Lowe court further explained:
The Commission’s actions, as stated in its ruling, indicate an arbitrary and
capricious reaction. An administrative act is arbitrary and capricious if the
agency “entirely failed to consider an important aspect of the problem, or
24
offered an explanation for its decision that runs counter to the evidence before
the agency or is so implausible that it could not be ascribed to a difference in
view or the product of any agency expertise.” 2 Am. Jur. 2d § 530 at 519
(1994). In addition, the failure of any agency to abide by its rules is per se
arbitrary and capricious as is the failure of an administrative body to conform
to prior procedure without adequate explanation for the change. Id.
Id. at 714 (¶12) (quoting Weems, 653 So. 2d at 281) (emphasis added).
¶33.
I agree with Hillside’s argument that the Commission exceeded its authority in
inquiring, during the hearing, about the financial viability of the project, exploring its method
of financing the project, and its rental rate structure. I also agree with Hillside’s argument
that its involvement with Realtex and the Mississippi Regional Housing Authority VIII
(MRHA), coupled with the fact that the project would be financed using low-income tax
credits, “played a significant role in the Planning Commission’s denial.” I agree further with
Hillside’s argument that the ordinance does not grant any power to the Commission to base
its decision to deny use on “technical engineering concerns such as drainage” and that the
Commission exceeded the scope of its power when it did so.
¶34.
As the above-quoted exchanges indicate, none of the comments or questions by the
commissioners were targeted at the factors that the Commission was required to consider in
arriving at a determination as to whether approval should be granted. Therefore, Lowe
compels the conclusion that the Commission’s denial is per se arbitrary and capricious. It
is clear to me that the Commission’s reasons for denying Hillside’s application are not based
on any of the factors that it is required to consider. Although the Miazzas’ attorney argued
during the hearing before the Commission, and stated in the letter submitted to it, that
allowing the development would cause crime to increase in the area, he did not present any
25
evidence by way of statistics or studies from other housing developments reflecting an
“atmosphere of cultivation of crime.” Nor did he present any evidence of a general rise in
criminal activity in business districts containing multi-family dwellings. Moreover, the
socioeconomic status of the tenants of the proposed development is not one of the factors to
be considered as a part of the decision to grant or deny the request. In short, I find that the
evidence is overwhelming that the motivating factor in the Commission’s denial of Hillside’s
request was the prevention of additional affordable housing for low and moderate income
persons. The comments and questions from the commissioners leave no doubt that this is the
case. Also, the comments and questions from the councilpersons show without doubt that
the City Council and the Commission were on one accord in this endeavor.
¶35.
Therefore, I would find that the decision of the City Council affirming the decision
of the Commission is not supported by substantial evidence and is arbitrary and capricious.
It likewise follows that the circuit court erred in affirming the decision of the City Council.
Consequently, for the reasons stated, I would reverse and render the judgment of the circuit
court and remand this case to the Commission to issue the required approval to Hillside for
construction of the development.
KING, C.J., MYERS, P.J., AND CARLTON, J., JOIN THIS OPINION.
26
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