Reverse Chronology: Group Two BUDs

For the 4,000 plus Florida Keys landowners who own undeveloped property, take heart. The war is far from over.

June 24-26, 2008, 2007 BUD Ordinance Challenge. The Groups Two and Three challenge to Monroe County's amended Beneficial Use Determination (BUD) ordinance (Ordinance 35-2007) with lead Petitioner Sal Gutierrez was heard by a DOAH Administrative Law Judge June 24th in Key West. You can see how the BUD procedure has been amended since it was initially adopted in 1986, by clicking on the following links: 1986 BUD Ordinance ;   1996 Comprehensive Plan BUD; 1998 BUD Ordinance;   2007 BUD Ordinance (Proposed, not yet in effect). Click here for the Petition.

March 18-20, 2008. Groups Two & Three. 25 Beneficial Use Determination (BUD) petitions were heard by a State Administrative Law Judge on  March 18-20, 2008. But no recommended orders have been issued. That is, in part, due to our concern that the ALJ would adopt the County's "position" that it did not have to pay for denying all, or substantially all, use of land where the owner had not sought compensation within four years of enactment of the offending regulation. (Statute of Limitation argument.) This is the same argument that Judge Audlin was just reversed on in Collins and Shands. Now that Collins has been reversed, and the Florida Supreme Court has told the government to "get over it," we can get these BUDs out of limbo and file a 25-plaintiff regulatory taking lawsuit.

November 29, 2007. We filed a Petition for Administrative Hearing, on behalf of the Group Two/Three Plaintiffs, challenging DCA's proposed final order approving Monroe County's proposed revisions to its Beneficial Use Determination regulations.

These landowners own 130 vacant parcels with an aggregate Fair Market Value in excess of $28 million. The County is expected to try like the devil to avoid hearing these claims (a fox watching the henhouse comes to mind) but it will not succeed. This is the next big Regulatory Taking claim facing the County. First came Galleon Bay at $6 million plus; then Collins, et al., at $6 million plus; now Group Two at $28 million plus. Will it ever end? No.

October 1, 2007. We (that includes the County) attempted to set these BUD petitions down for hearing the first week in October. Everyone's schedule was so full that we would have had to hear 24 BUD petitions in 1-1/2 days on October 3 and 4. That seemed impractical so both sides agreed to find a week when they can all be heard.

February 21, 2007. I called Tyson Smith and informed him that (a) the BUD Petitioners would not accept any Monroe County employee as the Hearing Officer for these applications, and (b) that Mr. Tobin and I are preparing a lawsuit against the County (and Marathon and Islamorada) seeking a Declaratory Judgment that their existing land development regulations and comprehensive plans are confiscatory and unconstitutional on Due Process grounds, because the Beneficial Use Determination procedure does not lead immediately to an eminent domain proceeding. The solution, as we see it, is to (a) declare the LDRs and ComPlans unconstitutional, or (b) order revisions of the BUD provisions to make the LDRs and ComPlans constitutional.

I suggested to Mr. Smith that scheduling the 23 BUD applications before a County employee/hearing officer would not fly, and that the County might as well hold off until our BUD lawsuit is filed.

While the County remains of the opinion that the applications lack necessary information, at your request, the County will begin reviewing the materials submitted and will schedule hearings before the hearing officer. However, by doing so, the County does not waive its right to object, during the BUD proceedings, to any deficiencies in the materials you have provided."

January 25, 2007. Responding to our November 23rd supplementation of the 2005 BUD applications, attorney Tyson Smith sent me the following e-mail message.

The County asked that I respond to your letter of November 3, 2006 related to twenty-three BUD Applications submitted by you. These applications had been returned because they lacked information necessary for the hearing officers proper determination under the Comprehensive Plan and the LDRs. In response, you submitted appraisals for most of the properties, but did not respond to the County's other requests.

November 3, 2006. The 23 Beneficial Use Determination (BUD) applications that Monroe County returned on February 1, 2006, as "insufficient" -- one day after Judge Payne issued his amended liability order in the Galleon Bay case -- were returned to the County for processing. These 23 BUD applications included appraisals showing that the fair market value of these properties -- if buildable -- exceeds $28 million.

Few people understand the significance of the BUD process. Since 1986, the Florida Keys' land development regulations (LDRs) have been apparently confiscatory. The BUD process has been instrumental in protecting the County for 20 years. It will now be instrumental in providing compensation for landowners who have been losing out for those 20 years. For example, in 1986 several thousand buildable, platted Keys lots were rezoned to require at least an acre to build a single-family home. This appears to be a confiscatory LDR -- and in 1986 confiscatory LDRs were unconstitutional in Florida (Dade County v. National Bulk Carriers) -- and could easily be invalidated.

In 1987, the US Supreme Court held, in First English Evangelical Church v. Los Angeles County, that a landowner was entitled to compensation for a confiscatory LDR, and that invalidation alone did not go far enough to meet the Taking Clause of the US Constitution.

Some think that First English replaced the National Bulk Carriers rule that confiscatory LDRs are invalid. The Florida Supreme Court resolved that issue, in 1990, in Joint Ventures v. Florida DOT. It held that a confiscatory law must have an explicit administrative process for paying just compensation to affected landowners, or it is unconstitutional on Due Process grounds. The supreme court expressly rejected the State's argument that the existence of a right to sue in inverse condemnation (as we are doing in Galleon Bay and in the Collins case) was sufficient to make a confiscatory law constitutional.

Monroe County's Beneficial Use Determination procedure is the explicit administrative process that has protected Monroe County's LDRs from being invalidated as confiscatory regulations. If the County refuses to process BUD applications, or processes them in a frivolous manner, then the County's LDRs will be subject to being invalidated on Due Process grounds, as in Joint Ventures and National Bulk Carriers.

November 3, 2006. Finally, we got the 22 "incomplete" applications out the door and back to the County, and added a 23rd application (that was submitted individually and rejected).

July 2, 2006. Andy Tobin and I are working -- in amongst the Galleon Bay and Group One activities -- to return the Group Two applications (rejected January 31 as "incomplete") to the County for processing.

February 15, 2006. 22 landowners, represented by yours truly and Andrew Tobin, filed "Beneficial Use Determination" applications with Monroe County on October 30, 2005. The County returned the applications on January 31, 2006, citing the need for additional information to "complete" the applications. While we do not agree that the applications are "incomplete," we can and will supply some additional information (specifically, appraisals).