Agenda - Planning Commission - 03/01/2012

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Zoning Bulletin January 25, 2012 1 Volume 61 No. 2 Thereafter, the Partnership appealed. Among other things, it argued that the 1996 rezoning constituted spot zoning, and that the spot zoning constituted a compensatory regulatory taking. The trial court agreed that the restrictions on the Property constituted spot zoning. It issued a writ of mandate declaring null and void the reso- lution denying the Partnership's application to develop four houses on the Property. The Court also found that the spot zoning constituted a compensable taking. The City appealed. DECISION: Affirmed in part, reversed in part, and remanded. The Court of Appeal, Fourth District, Division 3, California (the "Court"), held that the City's downzoning of the Property, to permit one dwelling per 20 acres in the middle of a residential tract whose zoning allowed at least four dwellings per acre constituted improperly discrimi- natory spot zoning. The Court also held that the City's actions consti- tuted a compensable, partial taking. In so holding, the court explained that the "essence of spot zoning is irrational discrimination." Impermissible spot zoning occurs, further explained the Court, "where a small parcel is restricted and given lesser rights than the surrounding property ... thereby creating an `island' in the middle of a larger area devoted to other uses ...." Here, the Court found there was "no question that the [Partnership's] parcel [was] a one - house - per -20 -acre island in a two -to -six house- per -acre sea." Clearly, concluded the Court, this was discriminatory downsizing. The Court also found that the City's downsizing of the Property's zon- ing was a partial taking, which was compensable. The Court explained that "[t]here are compensable takings that do not involve the deprivation of all economically viable use of land." A compensable regulatory tak- ing can occur when a regulation "goes `too far,' but stops short of deny- ing all economically viable use." Whether a regulation goes too far and is compensable depends on three core factors present: (1) the economic ef- fect on the landowner; (2) the extent of the regulation's interference with investment - backed regulations; and (3) the character of the governmental action. (These are known as the "Penn Central factors. ") Here, the court found these three core factors readily applied: First the economic effect was "dramatic." The Property value was $1.3 mil- lion if four houses could be built, or $0 under the RVL zoning. Second, "the regulation wholly undermined the investment - backed expectations of the Partnership," which had even obtained approval for a four -house development in 1983. Third, "the character of the governmental action appears to have been largely motivated to keep the subject parcel open space" (as petitioned by opponents to the 1983 approval). © 2012 Thomson Reuters 7