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Fulton Railroad Co. Ltd. v. City of Cincinnati

Court of Appeals of Ohio, First District, Hamilton

December 29, 2017


         Civil Appeal From: Hamilton County Court of Common Pleas TRIAL NO. A-1406585

          Barrett & Weber, C. Francis Barrett and Joshua L. Goode, for Plaintiffs-Appellants,

          Paula Boggs Muething, City Solicitor, Marion E. Haynes, Assistant City Solicitor, and Emily E. Woerner, Assistant City Solicitor, for Defendants-Appellees.


          Miller, Judge.

         {¶1}We affirm the trial court's reluctant determination that the residential zoning designation placed on riverfront land near downtown Cincinnati, presently and historically used for industrial purposes, is constitutional. The city is empowered to zone property in an effort to change the character of a neighborhood. Appellants did not meet their high burden of establishing that the zoning applied to their property is unconstitutional. Nor did they establish a total regulatory taking, i.e., that the zoning deprived the owner of all economically viable uses of the land, assuming such a claim was properly pled.


         {¶2} Fulton Railroad Company ("Fulton"), Sawyer Place Company ("Sawyer"), and Cincinnati Barge & Rail Terminal, LLC, ("Cincinnati Barge") claim that the zoning of the property at issue as "Riverfront Residential/Recreational" ("RF-R") is unconstitutional. The subject property, owned by Fulton and Sawyer, consists of 26-plus acres along the Ohio River, upriver from downtown Cincinnati. It abuts the Theodore M. Berry International Friendship Park to the west, light industrial property to the east, and residential property to the northwest. Approximately 18 of these acres are out of the floodplain-making the property somewhat unique.

         {¶3} The property, used for commercial and industrial purposes for at least 200 years, is currently used by Cincinnati Barge as a barge terminal. Materials are offloaded from barges, stored in yards, and loaded onto trucks and railcars for further transport. For decades, the city has wanted the property to be used for high-end residential purposes, and has zoned it accordingly. Despite this zoning, the code allows Cincinnati Barge to continue its operations as a legal, nonconforming use.

         {¶4} In 2007, the city rezoned the property to Planned Development 46 ("PD-46") via Cincinnati Ordinance 39-2007. Before this change, the property, which consists of multiple parcels, had a unified zoning designation of "Planned Development 17" ("PD-17"). Prior to PD-17 zoning, the parcels were in two zoning categories, "R-5(T)" and "RF-2." The PD-46 designation allows development for office, hotel, and residential mixed-uses. Among other requirements, a final development plan had to be submitted and approved to keep the PD-46 designation. If a final development plan was not approved, Cincinnati Ordinance 39-2007 provided that the property would "revert" to RF-R, a zoning classification it never previously had.

         {¶5} In 2014, after numerous extensions, the city denied Sawyer's request to modify PD-46 to adopt its present use as the final development plan, and also denied its request for yet another extension to submit a final development plan. The PD-46 designation terminated. Under Cincinnati Ordinance 39-2007, the property "reverted" to RF-R.

         Procedural Posture

         {¶6} Appellants filed this action seeking a declaration that RF-R zoning is unconstitutional as applied to the subject property. Appellants contended, in relevant part, that (1) the zoning designation deprived them of economically viable uses;[1] (2) the uses permitted by the RF-R zoning were not "reasonably practical" uses; (3) the RF-R zoning bears no reasonable relationship to the preservation of the public health, safety, morals, or general welfare; and (4) the zoning failed to substantially advance a legitimate government interest. Appellants also moved for a declaration that Cincinnati Ordinance 39-2007 did not authorize RF-R zoning after the expiration of the PD-46 overlay district because the zoning should have "reverted" to what had existed prior to Cincinnati Ordinance 39-2007-namely PD-17, or a combination of R-5(T) and RF-2.

         {¶7}The case proceeded to a bench trial, during which numerous experts testified concerning the purpose of the zoning and the economies of developing the property as zoned. Appellants' experts surmised that developing the property for residential purposes in accordance with the RF-R designation was not economically feasible. The city primarily argued that the zoning designation was constitutional because it had a substantial relationship to the city's plan to meet the demand of new residents seeking high-end housing close to downtown Cincinnati and on the Ohio River, and that a high-end residential development was likely to increase property tax revenues. Each side offered experts to rebut the other's experts.

         {¶8} In an advisory "letter decision" before it formally entered judgment, the trial court indicated that it was sympathetic to appellants' plight, and went so far as to voice skepticism regarding the legal burden placed upon landowners. The trial court nevertheless recognized that it was constrained to apply the law as it found it, and informed the parties that it intended to rule that the zoning was constitutional. The court directed the city to prepare a proposed entry.

         {¶9} The trial court later entered extensive findings of fact and conclusions of law, in which it incorporated its letter-decision, and held that appellants had not met their burden to demonstrate that the zoning regulation was "clearly arbitrary, unreasonable, or without substantial relation to the public health, safety, morals, and general welfare of the community." On this basis alone, the court determined that the zoning regulation was constitutional as applied to the subject property. The court did not directly address appellants' economic-feasibility argument in its conclusions of law, although it made factual findings that appellants had failed to prove that the property could not be developed for a residential use.

         {¶10} The trial court also concluded that the RF-R designation was not "revisionary zoning, " as appellants had contended, because the "clear intent" of the city's ordinance "was to apply RF-R, Riverfront Residential/Recreational, zoning to the subject property should the Planned Development 46 zoning lapse." The court dismissed appellants' complaint with prejudice, and entered judgment in favor of the city.


         {¶11} In appellants' sole assignment of error, they contend that the trial court erred as a matter of law because it failed to apply the proper test for determining the constitutionality of zoning, and that it failed "to follow the required standards" for considering whether the zoning as applied to their property is constitutional. Through artful wording, appellants attempt to shoehorn our review solely into a question of law that we review de novo. However, appellants subdivide their assignment of error into six issues. As the city correctly points out, not all of the issues present questions of law. We will address the standard of review for each issue as they come.

         {¶12} The judgment was consistent with the findings of fact.

         In the first issue presented for review, appellants argue that the trial court's letter-decision indicates that the court found the zoning to be arbitrary and unreasonable and without substantial relation to the public health, safety, morals, or general welfare, and yet failed to enter judgment in appellants' favor.

          {¶13} Application of the law to the trial court's findings presents a legal question that we review de novo. Nationwide Mut. Fire Ins. Co. v. Guman Bros. Farm, 73 Ohio St.3d 107, 108, 652 N.E.2d 684 (1995); Castlebrook Ltd. v. Dayton Properties Ltd. Partnership,78 Ohio App.3d 340, 346, 604 N.E.2d 808 (2d Dist.1992). A zoning regulation that is arbitrary and unreasonable and without substantial relation to the public health, safety, morals, or general welfare is unconstitutional. State ex rel. Ridge Club v. Amberley Village, 1st Dist. Hamilton No. C-070012, 2007-Ohio-6089, ΒΆ 11. Appellants do not challenge any ...

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