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Smith v. Dep’t of Environmental Protection
OATH Index No. 673/08 (Dec. 28, 2007)
Department’s denial of variance application was not an abuse of discretion where applicant failed to prove that denial of the variance would impose a substantial hardship.
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NEW YORK CITY OFFICE OF
ADMINISTRATIVE TRIALS AND HEARINGS
In the Matter of
GEORGE R. SMITH
Petitioner
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DEPARTMENT OF ENVIRONMENTAL PROTECTION
Respondent
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REPORT AND RECOMMENDATION
ALESSANDRA F. ZORGNIOTTI, Administrative Law Judge
This appeal was filed pursuant to section 18-28, title 15 of the Rules of the City of New York (“the watershed regulations”). Petitioner George R. Smith, proceeding pro se, appeals from respondent’s denial of his application for a variance concerning the construction of a subsurface sewage treatment system (“SSTS”) in the watershed area north of New York City. The variance application was denied by Steven W. Lawitts, the First Deputy Commissioner of the Department of Environmental Protection. For the reasons below, I conclude that the denial of the variance application was not an abuse of discretion, and recommend that the First Deputy Commissioner’s determination be affirmed.
ANALYSIS
In 1990, petitioner purchased approximately 42 acres in the Town of Neversink, in Sullivan County, New York. The property is located near the Rondout Reservoir, within the watershed area. Petitioner currently resides on the property in a single-family home.
In 2003, petitioner entered into discussions concerning the sale of 20 acres to the Department. An appraisal prepared for the Department noted that the parcel’s “gentle to moderate slope” and the slow permeability of the soil were limitations to construction, which could be resolved through “grading and installing drains around the footings and foundations of the dwellings.” The appraisal concluded that the parcel “would be best utilized for limited single-family, recreational and/or conservation uses.” See Appraisal dated October 20, 2003. Petitioner did not accept the Department’s offer to purchase the parcel. In 2004, the Department increased its offer but that offer was also refused by petitioner.
On June 7, 2007, petitioner submitted an application for a variance in order to construct an SSTS on a 15 acre subdivision of the 42 acre parcel. Petitioner proposed to build a four bedroom house on the parcel which he would then sell to give him some retirement revenue. In support of his application petitioner submitted a narrative statement from Kelly Engineering, P.C. with attached plans, a copy of the deed for the property, and the Short Environmental Assessment Form. The engineering firm proposed to install an Eljen In-Drain SSTS on an area with existing natural slopes of 17.5%. The watershed regulations prohibit building an SSTS on land with “slopes greater than 15%” within the watershed. 10 NYCRR Appendix 75-A, § 75-A.4(a)(1) (Lexis 2007).
The watershed regulations were promulgated for the purpose of protecting the quality of the drinking water used by approximately nine million New Yorkers. The quality of the water “faces a continuing threat from the cumulative and episodic impacts of pollution sources generated by certain land uses and activities in the watersheds” such as improperly located or designed SSTS. 15 RCNY § 18-11(a). The Department may, however, grant a variance from regulatory requirements in its discretion if the applicant can:
1. Identify the specific provision of the rules and regulations from which the variance is sought or identify the nature and extent of the alteration or modification of the noncomplying regulated activity;
2. Demonstrate that the variance requested is the minimum necessary to afford relief;
3. Demonstrate that the activity as proposed includes adequate mitigation measures to avoid contamination to or degradation of the water supply which are at least as protective of the water supply as the standards for regulated activities set forth in [the] rules and regulations; and
4. Demonstrate that for the proposed use or activity for which the variance is requested, compliance with the identified provision of the rules and regulations would create a substantial hardship due to site conditions or limitations.
15 RCNY § 18-61(a)(1) (Lexis 2007). The applicant bears the burden of proof with respect to each of these requirements. Id. at § 18-61(a)(4).
In a determination dated August 22, 2007, the First Deputy Commissioner denied the application on the grounds that petitioner did not demonstrate that denial of the variance would create a substantial hardship due to site conditions or limitations. Since petitioner did not establish substantial hardship, the First Deputy Commissioner did not consider whether the other requirements had been met.
This appeal was filed on September 18, 2007. Petitioner submitted additional papers on October 22, 2007. The Department’s answer was filed on November 7, 2007, along with the agency record.
On this appeal, the sole issue is “[w]hether the Commissioner or the First Deputy Commissioner abused his or her discretion in denying a request for a variance.” 15 RCNY § 18-28(d)(3) (Lexis 2007). An agency’s interpretation of the statutes and regulations that it administers is entitled to deference, and must be upheld if reasonable. ATM One, LLC v. New York State Division of Housing & Community Renewal, 37 A.D.3d 714, 831 N.Y.S.2d 436, 438 (2d Dep’t 2007). A reviewing tribunal may not overturn an agency’s decision merely because it would have reached a contrary conclusion by substituting its judgment for that of the agency. To find an abuse of discretion, the reviewing body must find that the determination was arbitrary and capricious and lacked a rational basis. Pell v. Bd. of Education, 34 N.Y.2d 222, 356 N.Y.S.2d 833 (1974). The petitioner has the burden of proving that the First Deputy Commissioner abused his discretion. 15 RCNY § 18-28(e) (Lexis 2007).
In this case, petitioner did not address any of the provisions of section 18-61(a)(1) in his original variance application, let alone the fourth prong which requires that an applicant “demonstrate” that “substantial hardship” would ensue if the application were denied. Indeed, the application is devoid of any discussion concerning substantial hardship which would require the granting of a variance. Therefore, petitioner did not meet his burden of proof and there is no basis for finding that the First Deputy Commissioner abused his discretion in denying the request for a variance.
On appeal, petitioner argued for the first time that denial of the application would constitute substantial hardship. Petitioner alleged that he purchased the property as an investment for retirement and that prior to his variance application he had offers to buy the new lot contingent on approval of the SSTS by the Department. Petitioner claimed that he has since returned the potential buyers’ deposits and that he has spent over $7,000 on engineering and land surveying costs to date. Petitioner argued that his inability to finalize a sale as well as his outlay of expenses, constitute substantial hardship. He implied that without approval for his current proposal he will be forced to sell the entire property and move elsewhere. In addition, petitioner submitted on appeal the 2003 appraisal and argued that the Department never mentioned the 17% grade in its proposal to purchase the property in 2003.
The regulations provide that an appeal from a denial of a variance “shall be decided on the record before the Department in its review of the application and any other written submissions allowed by the ALJ.” 15 RCNY § 18-28(f)(1) (Lexis 2007). See also Guard Hill Farms Associates v. Dep’t of Environmental Protection, OATH Index No. 157/98 (Aug. 11, 1998), aff’d, Comm’r Dec. (Sept. 11, 1998) (declining to consider factual argument of applicant that was not raised before the Department prior to its ruling on the variance application).
Having failed to meet his burden before the First Deputy Commissioner, petitioner should not be allowed to supplement the record at this juncture with additional documents and by raising factual contentions concerning his financial hardship, leaving respondent without any reasonable means to determine whether petitioner’s allegations are true.
Even if I were to invoke my discretion to permit such consideration of such claims and documents, see 15 RCNY § 18-28(f)(1) (“Appeals from determinations relating to . . . variances shall be decided on the record before the Department in its review of the application and any other written submissions allowed by the ALJ”), and even if petitioner’s contentions regarding adverse economic impact were credited, petitioner still would not have established substantial hardship, due to his failure to make any showing regarding the feasibility or infeasibility of alternate uses of the parcel.
As explained by the New York State Court of Appeals, an applicant seeking a variance on the basis of substantial hardship is required “to describe those physical conditions on the subject parcel that make compliance with a particular regulation difficult – or impossible – and thereby explain the perceived need for a variance.” Nilsson v. Dep’t of Environmental Protection of City of New York, 8 N.Y.3d 398, 404, 834 N.Y.S.2d 688, 691 (2007). A denial of a variance that renders a property “unusable” or “unsalable” may constitute a substantial hardship. See Lucas v. S.C. Coastal Council, 505 U.S. 1003, 112 S. Ct. 2886 (1992); Farley v. Dep’t of Environmental Protection, OATH Index No. 941/06, at 7 (Jan. 19, 2006). However, the inability to maximize return on an investment is not proof of substantial hardship. Carreras v. Dep’t of Environmental Protection, OATH Index No. 1529/05, at 7 (June 2, 2005).
In Buckskin Realty, Inc. v. Department of Environmental Protection, OATH Index No. 216/04 (Dec. 30, 2003), an owner sought a variance in order to construct and use an on-site SSTS to treat human and household wastes from a three-bedroom, single-family residence to be built on the parcel on a 17% to 18% slope. The variance was denied because the owner failed to establish that compliance with the standard from which a variance was sought would result in a substantial hardship. On appeal, the owner claimed that construction of the residence was not feasible without the variance and that it would be deprived of a reasonable use of the property. This tribunal rejected this argument as speculative and recommended that the appeal be denied.
Here, petitioner has failed to establish that compliance with the Department’s regulations constitutes a substantial hardship. He did not describe the physical conditions of his land that make complying with the watershed regulations either prohibitively expensive or impossible. To the contrary, petitioner claimed that the slope could be easily corrected to 15% “in minutes” by pushing “over a few stumps and flatten[ing] the area.” See Petitioner’s Letter dated October 22, 2007. Furthermore, petitioner did not note any impediment to the sale of the land should the variance be denied. Petitioner’s claimed inability to maximize an economic return on his investment is insufficient to demonstrate substantial hardship where, as here, petitioner made no showing that the parcel could not be used for other, albeit less profitable uses. In the mean time petitioner continues to live on the property and does not need a variance to remain in his current home. Therefore, petitioner has failed to demonstrate a substantial hardship within the meaning of the watershed regulations.
Finally, petitioner’s assertion that the Department’s failure to mention the 17% grade in the appraisal precludes denial of the variance is also without merit. The appraisal was merely an analysis of the market value of the property in 2003. It was not an opinion whether a variance should be granted and has no bearing on this appeal.
As petitioner failed to establish that the agency determination was an abuse of discretion, the appeal must be denied.
FINDINGS AND CONCLUSIONS
1. Petitioner failed to prove that he would suffer substantial hardship from the denial of the variance application.
2. The First Deputy Commissioner did not abuse his discretion by denying the variance application.
RECOMMENDATION
I recommend that the First Deputy Commissioner’s denial of petitioner’s variance application be affirmed.
Alessandra F. Zorgniotti
Administrative Law Judge
December 28, 2007
SUBMITTED TO:
EMILY LLOYD
Commissioner
APPEARANCES:
GEORGE R. SMITH
Petitioner, Pro Se
MELISSA S. SIEGEL, ESQ.
SANDRA SALTER JACKSON, ESQ.
Attorneys for Respondent