02/09/2011 05:36:00 PM EST
How a Colorado County Pulled the Zoning Rug from under a Developer’s Feet; Rezoning Upheld notwithstanding $2.6 Million in Land Preparation Costs
Circuit recently determined that a Colorado county's decision to rezone land
did not deprive landowners of a constitutionally protected property interest, even though the landowners
approximately $2.6 million in capital development costs in preparation for
selling the land. The court held that a protected property interest could not
be established under Colorado's Vested Property Rights Act (VPRA), Colo. Rev.
Stat. § 24-68-101, et seq. or under Colorado common law.
Arapahoe County approved a preliminary development plan (PDP)
that rezoned the landowners' property and allowed for "Automotive Sales
and Repair." Thereafter, the landowners paid $2.6 million in capital
development costs for (a) street construction, (b) site preparation and
grading, (c) water channel drainage improvements, and (d) sanitary sewer
installation, all in preparation for selling their land to a buyer interested
in using it for an automotive dealership.
After the landowners agreed to sell their land to CarMax,
which intended to operate a car dealership, the County altered the zoning,
making it impossible to build the dealership on the land. In Jordan-Arapahoe, LLP v. Bd. of County Comm'r,
2011 U.S. App. LEXIS 2359 (10th Cir. Colo. Feb. 8, 2011) [enhanced version available to lexis.com subscribers / unenhanced version available from lexisONE Free Case Law], the landowners argued that the County's zoning decision had deprived them
of a protected property interest without due process. To demonstrate a vested
property interest, the landowners pointed to the VPRA and Colorado
The 10th Circuit refused to find a vested property interest under
the VPRA, holding that the County had discretion under its zoning code
to reject or modify proposed developments until it approved a final development
plan. As contemplated by the VPRA, vesting could not occur until the County's final
of common law vesting, the landowners pointed to Eason v. Bd. of County Comm'rs of Boulder, 70 P.3d 600 (Colo. Ct.
App. 2003) [enhanced version / unenhanced version], claiming Colorado law allowed property
rights to vest by virtue of a zoning classification (as opposed to a building
permit) and detrimental reliance thereupon. The landowners contended that they had
detrimentally relied on the County's representations or affirmative actions when
they developed the land for sale to CarMax.
the facts showed detrimental reliance, the court was left to resolve whether the
landowners had relied on the County's representation or affirmative action. In addressing
the question, the court recognized that:
Eason does, however, stand
for the principle that once a planned development
in a zoning classification is backed by affirmative actions or representations
by county officials-such as active acquiescence by word or deed or through some
other unequivocal confirmation-then parties who rely on those affirmations will
have vested property rights under the common law. But the analysis will be
case-by-case and factually intensive.
facts of the case, the court refused to find an affirmative
action. The court noted that approval of the PDP alone could
not qualify as an affirmative action or representation because the landowners
could not have reasonably relied on the PDP approval as creating a vested right
absent the second-step final approval.
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