Bd. of Supervisors of the Cnty. of Albemarle v. Route 29, LLC

872 S.E.2d 872

BOARD OF SUPERVISORS OF the COUNTY OF ALBEMARLE

v.ROUTE 29, LLC

Record No. 201523

Supreme Court of Virginia.

June 2, 2022

Susan Baumgartner, Senior Assistant County Attorney (Greg Kamptner, County Attorney; Andrew H. Herrick, Deputy County Attorney, on briefs), for appellant.

Peter J. Caramanis, Charlottesville, (Shellie S. Taylor; Royer Caramanis, on brief), for appellee.

Present: Goodwyn, C.J., Powell, Kelsey, McCullough, and Chafin, JJ., and Millette, S.J.

OPINION BY CHIEF JUSTICE S. BERNARD GOODWYN

In this appeal, we consider whether the owner of rezoned property, who claims that the triggering of a conditional proffer operated as an unconstitutional condition, states a cause of action, and whether the circuit court erred in denying a motion to strike the owner's evidence.

I. BACKGROUND

In September 2007, the Board of Supervisors of Albemarle County (the County) approved a rezoning for property located at Hollymead Town Center, Area A, Block A1 (the Project), subject to enumerated voluntary proffers. The Project is part of a much larger development at Hollymead Town Center, and has been owned by Route 29, LLC (the Owner) since September 2009.

The following conditional proffer (the Transit Proffer) has continuously applied since the original rezoning in 2007:

2. Public Transit Operating Expenses – Within thirty days after demand by the County after public transportation service is provided to the Project, the Owner shall contribute $50,000 cash to the County to be used for operating expenses relating to such service, and shall contribute $50,000 cash to the County each year thereafter for a period of nine (9) additional years, such that the cash contributed to the County pursuant to [the Transit Proffer], shall total Five Hundred Thousand Dollars ($500,000). The cash contribution in years two through ten shall be paid by the anniversary date of the first contribution.

At its September 2015 meeting, the County discussed the mechanics of the Transit Proffer, the fact that the County could not demand payment until public transportation was established, and the concern that the public transportation would have to run continuously for ten years in order for the County to collect payment in full. One board member warned that "it would need to be a real transit bus, because to qualify for the proffer they will need to have a [Charlottesville Area Transport bus, i.e.,] CAT bus." He later noted that a CAT bus used to run in the area but there was not enough ridership in the area and CAT withdrew running the route.

The County discussed the establishment of a commuter route (the Commuter Route), which would be operated by JAUNT, Inc. (JAUNT),^* to run from northern Albemarle County to downtown Charlottesville. A JAUNT executive addressed the County regarding the Commuter Route providing service in the morning and evening. The County directed staff to study the proposal and "determine the steps necessary to implement the service."

At its November 4, 2015, meeting, the County again discussed the Commuter Route. It noted that the County had received several requests from residents for such a service, and that the Commuter Route "would also help relieve traffic congestion along the Route 29 corridor during the widening of Route 29" and during other related road construction. A representative for JAUNT told the County that, through a survey conducted in the neighborhood where the Commuter Route was to originate, twenty-five people expressed interest in the Commuter Route because they wished to commute to the University of Virginia (UVA) or the downtown area. One board member noted that "it may take a few years to build ridership on the route, but there are more houses approved that will be going up in this area." A route with a stop at the Project was deemed the most viable because a substantial portion of the funding for the Commuter Route could come from the Transit Proffer funds.

A board member stated that "the County has a significant number of proffers they may not end up using, but this one is an asset and should at some point be executed." To that end, the board member inquired "if they can start the service and interrupt it if the ridership is not there, then wait until the density becomes higher to reinstate it." The County approved the Commuter Route.

In a letter dated November 16, 2015, counsel for the Owner wrote to the County, objecting to the County's reliance on the Transit Proffer to fund the Commuter Route. The Owner noted that proffers must be "reasonable" and pointed out that the County's own Land Use Law Handbook stated that such reasonableness required "an essential nexus and rough proportionality between the [Transit Proffer] conditions and the impacts they seek to address." The letter noted that the Commuter Route would take people from northern Albemarle County to and from work at UVA or downtown, and "has absolutely nothing to do with [the Project]." The Owner insisted that the Project was merely being used as "a convenient hub for northern Albemarle commuters to meet the bus, but not to be a destination for this route." The letter also declared that the "need for [the Commuter Route], if one can even be demonstrated, is certainly not created by or related to the [Project]."

In its reply letter dated December 1, 2015, the County stated that "[t]he transportation impacts resulting from this rezoning [of the Project] were a key consideration [of the Transit Proffer], and many of the proffers accepted in conjunction with the rezoning addressed transportation-related impacts." The County also explained that the Commuter Route provided "public transportation service" within the meaning of the Transit Proffer, and that "it may be reasonably assumed that riders will get on and off the bus at [the Project] transit stop." Additionally, the County responded that "[the Project] is a large employment center and providing public transportation for the employees of [the Project] reasonably addresses some of the transportation impacts resulting from the [Project] rezoning." The County warned that the Owner's failure to comply with the Transit Proffer would constitute a zoning violation.

On December 2, 2015, the County approved the appropriation of funds to establish the Commuter Route, which included a stop at the Project, with the approved budget relying on future funds from the Transit Proffer. At the December 2, 2015, meeting, the Owner again represented that reliance on funds from the Transit Proffer for the Commuter Route was "not a reasonable application of the [Transit Proffer], and is not connected in terms of the required nexus." Counsel for the Owner emphasized that "the proposed [Commuter Route]" is designed "to bring people from the northern part of the County into the City, not related to the services provided by [the Project]."

The Commuter Route began operating on May 2, 2016. It is open to the public and includes a stop at the Project. It has never operated between the hours of 9:00 a.m. and 4:30 p.m., after 7:30 p.m., or on weekends.

On May 20, 2016, the County sent the Owner a letter requesting the first $50,000 payment on the Transit Proffer in light of the establishment of the Commuter Route. The County requested payment by June 20, 2016, and it warned that failure to comply would constitute a zoning violation. The Owner did not pay the requested installment of the Transit Proffer.

On May 7, 2018, the County sent another request for payment on the Transit Proffer, this time in the amount of $150,000. Again, the Owner did not make the requested payments.

On August 7, 2018, the County issued a notice of official determination of violation, informing the Owner that the Project was in violation of the County's zoning ordinance because of the Owner's failure to make payments required by the Transit Proffer.

On September 6, 2018, the Owner petitioned the County regarding an appeal of the zoning violation. A letter attached to the petition reiterated the Owner's arguments that the Commuter Route was unrelated to the Project and did not address any impacts of the rezoning, and, therefore, could not trigger its obligation to make payments pursuant to the terms of the Transit Proffer.

On December 5, 2018, the County held a hearing on the Owner's appeal. The Owner reiterated the argument that the current attempt to collect on the Transit Proffer was improper because the Commuter Route lacked an essential nexus to the impacts of the Project. The Owner acknowledged that the Transit Proffer could be lawfully enforced at a future date, if the demand for payment was based upon a trigger that possessed a nexus to the impacts of the Project. The County unanimously voted to deny the Owner's appeal.

On January 4, 2019, the Owner filed a complaint and petition for review, concerning the zoning violation, in the Circuit Court of Albemarle County, praying for a temporary injunction against any enforcement action related to the Transit Proffer, an order stating that the Commuter Route was not a valid trigger of the Transit Proffer's obligations, an order reversing the zoning violation, and "other and further relief as [the circuit court] deems just and appropriate." The complaint reiterated the arguments previously put forward by the Owner at County meetings and proceedings, and presaged the evidence and testimony that would be offered at trial. The circuit court granted the temporary injunction, enjoining the County from collecting funds related to the Transit Proffer, pending adjudication of the pending case.

The parties subsequently filed a list of agreed stipulations, a combination of agreed-upon facts and exhibits, as well as several provisional exhibits that were stipulated to be authentic but not necessarily admissible. Among these facts, the parties stipulated that the Owner owns the Project; that the Project was subject to the Transit Proffer; that the Commuter Route "is a form of public transportation" and had...