Posted by: Patricia Salkin | March 5, 2021

PA Commonwealth Court Concluded That Potential Hardship Suffered by the Developer if Variance Is Denied Was Self-Created

This post was authored by Olena Botshteyn, Esq.

Duncan Ventures, LLC (“Duncan”) was planning to demolish a house and construct five attached dwellings on a property in Pittsburgh. To do this, Duncan required several dimensional variances, and filed applications with the City Zoning Board of Adjustment (“ZBA”). ZBA granted the applications, and the trial court reversed. On appeal, the court affirmed, having concluded that Duncan failed to show that the property cannot be developed in conformity with the zoning requirements and the only hardship suffered if the variance was not granted would be self-created.

Duncan had a contract to purchase an irregularly shaped 7500-square-foot parcel of land, which it planned to acquire subject to approval of variances by ZBA. In June 2019, Duncan applied for dimensional variances, seeking to eliminate and minimize certain setback requirements. The application was opposed by the neighbors and other representatives of local community. They submitted a letter to the ZBA, stating that the proposed project “does not present any hardship for why the zoning relief is necessary.” At the hearing held in August 2019, Duncan’s principal presented a financial analysis of the project, citing a purchase price of $415,000. He stated that they considered building fewer houses on the property, which would allow to make the project compliant with the existing setback requirements, however, this would result in the net loss for the project. Neighbors also testified at the hearing. In particular, Jill Joyce, a registered architect testified that the project “would break up the aesthetic continuity of Home Street” and proposed an alternative three-house project, which would be compliant with the setback requirements. Other neighbors expressed traffic and congestion concerns. Despite the neighbors’ testimony, the ZBA granted the variances applications, stating that they “will not cause negative off-site impacts.” Neighbors appealed to the trial court, and it reversed. On appeal, Duncan asserted that the trial court abused discretion and erred in concluding that Duncan failed to meet all of the elements for a variance required by the Code.

The court concluded that the trial court did not err in its findings, since the applicant for a variance failed to meet the necessary three-part standard and did not show (1) any unique conditions of a property that would lead to unnecessary hardship, (2) that the variance would not result in adverse effect on the public welfare, and (3) that the proposed change forms the least modification possible. The court specifically focused on the first part of the standard. It acknowledged that the standard that applies to dimensional variances is more relaxed compared to use variances, and under this standard a financial hardship to the applicant may be considered. However, if hardship amounts merely to landowner’s intent to make the project more profitable, this criterion is not satisfied. Here, Duncan intended to construct specifically five townhouses to outweigh the purchase price. Even if the calculations were correct, the alleged purchase price of $415,000 was contingent on the zoning approval and not a market value of the property. Furthermore, Duncan could cancel the agreement, if the variances were not granted. Duncan did not present any other evidence that the development of the property in accordance with the code is not possible. The court thus concluded that any purported economic hardship was self-created and affirmed.

Lawrenceville Stakeholders v City of Pittsburgh Zoning Board of Adjustment, 2021 WL 836777 (PA Cmwlth 3/5/2021)    

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