Posted by: Patricia Salkin | July 30, 2009

Petitioner Lacked Standing to Challenge Environmental Review Over Consolidation of Manufacturing Facility

In 2007, Beach-Nut Corporation decided to consolidate its two Montgomery County manufacturing facilities located in the Village of Canajoharie and in the Town of Fort Plain respectively with its corporate headquarters located in Missouri. Beach-Nut sought to build a new facility in a business park owned by respondent Montgomery County Industrial Development Agency (IDA) located in the Town of Florida, Montgomery County. Beach-Nut received funding for its endeavor from respondent Empire State Development Corporation and was assisted by IDA in its project. It was Beach-Nut’s corporate decision to consolidate and relocate but it was infeasible to do so at its Canajoharie facility. Respondent Planning Board of the Town of Florida was the lead agency in the review of the project under the State Environmental Quality Review Act (SEQRA). A payment in lieu of tax (PILOT) agreement and lease were entered into between Beach-Nut and IDA. Construction on the project began and petitioner, Village of Canajoharie, brought this lawsuit alleging violations of SEQRA and the General Municipal Law. It sought a temporary restraining order and preliminary injunction. It also sought a declaration that the site plan approval, findings statement for the project, PILOT and lease agreements, and the financing assistance package from Empire State Development were all invalid. The request for a temporary restraining order and injunctive relief were denied at a hearing. The Supreme Court dismissed the petition on several grounds including standing and the petitioner appealed.

The court found that the SEQRA claims were properly dismissed on standing grounds. Standing with respect to SEQRA claims requires that a challenger “demonstrate that it will suffer an injury that is environmental and not solely economic in nature.” Here, the court held petitioner did not make any showing that it would suffer a “specific or direct environmental harm as a result of the proposed project” and allegations of potential economic harm does not afford petitioner standing.

Additionally, the court found that petitioner’s challenge of the PILOT agreement was properly dismissed because petitioner cannot challenge the agreement as violating General Municipal Law § 859-a(3) and § 874(4)(a) as it was not an “affected tax jurisdiction.” Further, the court held that since IDA specifically determined that the relocation project was “reasonably necessary,” the Supreme Court properly dismissed petitioner’s challenge that IDA’s findings were arbitrary and capricious and that the PILOT and lease agreements violated the anti-pirating provisions of General Municipal Law § 862(1).    

Village of Canajoharie v. Planning Bd. of the Town of Florida, 2009 WL 1795002 (N.Y.A.D. 3 Dept. June 25, 2009).

 The opinion can be accessed at:

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