*Title: 900 G Street Assocs. v. D.C. Dep’t of Housing & Comm. Dev.
*Citation: 430 A.2d 1387 (D.C. 1981)
*Decided Date: 02-Jun-81
Petitioner sought review in the D.C. Court of Appeals of the Mayor’s Agent’s decision to deny a permit to raze the Old Masonic Temple, an individually designated historic landmark. The petitioner did not seek compensation for the alleged taking, but instead sought judicial review of the Mayor’s Agent’s decision under the D.C. Administrative Procedure Act. The Court of Appeals, closely following the Supreme Court’s recent decision in Penn Central Transportation Co. v. City of New York, 438 U.S. 104 (1978), upheld the Mayor’s Agent’s decision, holding that the permit denial did not effect a taking of private property requiring compensation, and thus did not constitute an unreasonable economic hardship.
*Economic Hardship—Unconstitutional Taking:*
*Whether the denial of a demolition permit imposes an “unreasonable economic hardship” upon the applicant is determined with reference to the federal constitutional standard for a regulatory taking. The Court of Appeals followed the three-part test established in Penn Central Transportation Co. v. City of New York, 438 U.S. 104 (1978), which considers: (1) the economic impact of the regulation; (2) the regulation’s interference with the owner’s reasonable investment-backed expectations; and (3) the character of the governmental action. When “the historic preservation act to be applied does not specify an exact rate of return, or even any assured rate of return, as is true of the Act here, analogous principles of zoning and land use law may be applied.” These principles “establish that the ‘profitability’ to an owner of restricted property is to be measured by whether any reasonable economic use exists for the property.” Therefore, “if there is a reasonable alternative economic use for the property after the imposition of the restriction on the property, there is no taking, and hence no unreasonable economic hardship to the owners, no matter how diminished the property may be in cash value and no matter if ‘higher’ or ‘more beneficial’ uses of the property have been proscribed.” In the Court’s opinion, “the record [was] ... more than adequate to establish that the Mayor’s Agent could have reasonably concluded that an alternative economic use for the building exists.”
*The Court noted that an individual seeking a demolition permit on the basis of economic hardship bears the burden of demonstrating that there is no reasonable alternative economic use for the property.
*The Court believed that “the presence of possible purchasers of the Building ... supported a conclusion by the Mayor’s Agent that there was an alternative economic use of the property.”
*Standard of Review:*
*Citing Citizens Association of Georgetown v. D.C. Zoning Commission, 402 A.2d 36 (D.C. 1979) (en banc), the Court of Appeals noted that it must uphold the Mayor’s Agent’s findings of fact “unless it appears from the record that there is obvious and egregious error.”
*In reviewing a decision to deny a demolition permit, the Court of Appeals must “consider whether this conclusion was well founded on the record and whether the proceedings of the Mayor’s Agent that established the record were properly conducted so as to permit the development of a full and credible record from which the conclusions expressed in the denial by the Mayor’s Agent could be drawn.”
Decision of the Mayor’s Agent, HPA No. 79-310 (December 21, 1979).