NY Court of Appeals Finds Town’s SEQRA Positive Declaration on Rezoning Was Not Ripe for Judicial Review

Ranco Sand and Stone Corporation owned two parcels of contiguous property in an area zoned for residential use in Suffolk County in Smithtown, New York. In 1997, Rancho leased Parcel One to a private school bus company which, at all times relevant to this appeal, used it as a bus yard and trucking station. Although this use is unapprovedly nonconforming, the Town had not enforced residential zoning requirements on Rancho. Nevertheless, in 2002, Ranco applied to rezone Parcel One from residential to heavy industrial use. This case arose from Ranco’s challenge to a local Town Board’s positive declaration pursuant to the State Environmental Quality Review Act (SEQRA), that Ranco’s proposed rezoning may have significant effect on the environment, and requiring Ranco to prepare and submit a draft environmental impact statement (DEIS). Ranco commenced this CPLR article 78 proceeding against respondents the Town of Smithtown and the members of the Town Board, seeking to annul the positive declaration as “arbitrary, capricious, and unauthorized,” and requesting mandamus relief directing the Town to process the rezoning application without a DEIS.

Ranco asserted that the declaration imposed a hardship on the company because it would force it to incur between $75,000 and $150,000 in expenses in completing the DEIS, and that a DEIS was unnecessary, as demonstrated by the prior rezoning for heavy industrial use of Ranco’s contiguous parcel (Parcel Two), which was done without a DEIS. Ranco claimed that the court should treat the Town’s prior rezoning of Parcel Two, as res judicata and binding on the Town with respect to Ranco’s Parcel One application. Respondents moved to dismiss the petition for failure to state a cause of action. The Supreme Court granted the motion, finding the matter not ripe for judicial review, and the Appellate Division affirmed, concluding that the SEQRA positive declaration requiring Ranco to prepare a DEIS was the initial step in the decision-making process, and therefore did not give rise to a justiciable controversy.

The court found that the lump sum of between $75,000 and $150,000, and the percentage of the rentals collected under the Parcel One lease the declaration, imposed an obligation on Ranco in satisfaction of the first requirement of the ripeness-for-review analysis. However, the court found that the fact that Ranco could not recoup the costs incurred and time spent on conducting a DEIS to be sufficient, without more, to distinguish Ranco’s case from any other preliminary administrative action. Additionally, Ranco did not claim the declaration is unauthorized or that the property is not subject to SEQRA, nor did it present any other basis to conclude that the Town Board acted outside the scope of its authority. Accordingly, the finding that this claim was unripe was affirmed.

Ranco Sand and Stone Corp. v Vecchio, 2016 WL 1247671 (NY 3/31/2016)