Comm. of 100 on Fed. City v. D.C. Dep't of Consumer & Regulatory Affairs

• Title: Comm. of 100 on Fed. City v. D.C. Dep't of Consumer & Regulatory Affairs
• Citation: 571 A.2d 195 (D.C. 1990)
• Decided Date: 08-Mar-90

Summary:

Petitioners sought review in the D.C. Court of Appeals of the Mayor’s Agent’s decision to grant a demolition permit for the Woodward Building, which was located in the Fifteenth Street Financial Historic District. Going against the Historic Preservation Review Board’s recommendation, the Mayor’s Agent had determined that the demolition was necessary in the public interest by virtue of its consistency with the purposes of the Act and was also necessary for the construction of a project of special merit. The Mayor’s Agent approved issuance of a demolition permit subject to a number of conditions, including the recordation of a legal covenant between the developer and the District government requiring the provision of specified public amenities. The petitioners challenged the decision on four principal grounds: (1) the proposed project’s amenities did not support a finding of special merit; (2) the Mayor’s Agent’s finding of special merit was not supported by substantial evidence of the feasibility of the amenities; (3) the Mayor’s Agent’s special merit analysis should not have considered the economic feasibility of the Woodward Building’s renovation; and (4) the Mayor’s Agent could not use a legally enforceable covenant to bind a private owner on behalf of the District of Columbia. The Court remanded the case to the Mayor’s Agent, holding that the earlier decision had failed to consider material issues relating to the feasibility of the proposed amenities.

Comprehensive Plan:

• The Court rejected the Mayor’s Agent’s reliance on certain sections of the Comprehensive Plan for the proposition that day care is a priority for the Downtown Area, holding that “[w]hile day care is a priority for the greater District of Columbia community as a whole, the Comprehensive Plan focuses on indigent parents and does not direct that such programs be developed in the Downtown Area.”

• The Court also held that the Mayor’s Agent had misread the Comprehensive Plan as establishing a critical mass of downtown housing as a high priority for the District. The Comprehensive Plan refers to a “critical mass of key land uses,” which the Court understood to include a “mixture of commercial, cultural, retail, and professional uses, rather than major housing development.” Moreover, the sections of the Comprehensive Plan cited by the Mayor’s Agent apply only to specified areas within the Downtown Area; these areas did not include the Financial District.

Covenants / Development Agreements / Conservation Easements:

• The Court held that the recordation of a covenant between a developer and the District requiring the provision of specified public amenities did not necessarily constitute impermissible contract zoning. However, it did note that the “Mayor’s Agent did not address whether the concerns raised ... about the use and enforceability of covenants, in the context of demolition cases that have caused courts to ban contract zoning, should also rule out the use of covenants in historic preservation cases.” For this reason, the Court remanded the case for a more thorough explanation of the nature and likely operation of the proposed covenant.

• The Court held that the D.C. Uniform Conservation Easement Act (UCEA) did not govern the covenant proposed in this case. The UCEA applies only to “covenants associated with natural, scenic, or open space values and preservation of historical, architectural or cultural aspects of real property.” The Court observed that the District’s argument that this particular covenant was covered by the UCEA “appears to falter on the plain meaning of the statutory language.”

Economic Feasibility:

• The Court held that the Mayor’s Agent’s determination that the renovation of the Woodward Building was not economically feasible was “not persuasively supported by her findings of fact.” In rejecting the Mayor’s Agent’s analysis of economic feasibility, the Court noted that the “issue is not whether a Class ‘B’ building can command the level of rents necessary to justify the expense of renovation, but whether demolition of the Woodward Building and the historic values statutorily ascribed to buildings located within historic districts is justified by the cost of renovation and by the benefits which the new building would bring to the community.”

• In rejecting the petitioner’s argument that the Mayor’s Agent may not consider economic feasibility at all, the Court noted that the “Mayor’s Agent could properly consider factors associated with alternatives to demolition such as cost, delay, and technical feasibility.” (Citing Citizens Committee to Save Historic Rhodes Tavern v. D.C. Dep’t of Housing and Community Development, 432 A.2d 710, 718 (D.C. 1981); Don’t Tear It Down, Inc. v. D.C. Dep’t of Housing and Community Development, 428 A.2d 369, 380 (D.C. 1980)).

• Quoting from its opinion in Don’t Tear It Down, 428 A.2d at 380, the Court noted that the “reasonableness of the proposed project must be considered in the context of whether ‘there are viable alternatives to demolition available, and the answer to this question determines necessity.’”

• The Court emphasized the point that “economic feasibility is just one factor to be considered in determining whether to allow demolition,” and noted that the term “‘[n]ecessary’ cannot be equated with ‘least expensive.’”

Special Merit—General:

• The Court held that project must be “sufficiently special” to fall within the special merit exception of the Act. It noted that “[i]n order to justify the permanent loss and demolition of such a valuable structure ... the Preservation Act demands it be replaced with something sufficiently ‘special.’ While the Preservation Act does not require that a project of special merit be of epic proportions ... the Preservation Act is not standardless.”

• A determination that a proposed project is “sufficiently special” to constitute a project of special merit is a threshold requirement. Balancing “the historic value of the Woodward Building against the special merits of the project could not proceed until the Mayor’s Agent found that the amenities proposed ... were sufficient to constitute a project of special merit.”

Special Merit—Balancing:

Citing Citizens Committee to Save Historic Rhodes Tavern v. D.C. Dep’t of Housing and Community Development, 432 A.2d 710, 716 (D.C. 1981), the Court noted that in “a demolition case, a determination by the Mayor’s Agent that a project is of special merit implicitly includes the finding that issuance of a demolition permit is necessary in order for the project to proceed ... [and] the Mayor’s Agent must balance the value [to] the community of the historic structure against the special merit of the proposed project.”

Special Merit—Community Services Having a High Priority:

• Quoting from the Committee on Housing and Urban Development’s Report on Bill 2-367, the Court emphasized that “factors which are common to all projects are not considered as special merits.”

• The Court held that the proposed project could not qualify for the special merit exception simply because it would provide off-street parking. Because “parking must be considered with every downtown project ... it does not ordinarily qualify as an amenity of ‘special merit.’”

• Although housing and day care facilities may provide an adequate basis upon which to base a finding of special merit in some circumstances, the Court believed that in this case “the Mayor’s Agent failed to respond to material and relevant objections made at the hearing that such housing and day care amenities could be provided in a renovated Woodward Building and that the proposals were lacking any details to demonstrate their feasibility.”

Standard of Review:

Quoting from its opinion in MB Associates v. D.C. Dep’t of Licenses, Investigation and Inspection, 456 A.2d 344, 345 (D.C. 1982), the Court noted that it “must uphold the Mayor’s Agent’s decision if her findings of fact are supported by substantial evidence in the record considered as a whole and the conclusions of law flow rationally from those findings.”

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