Court Holds Municipal Resolution That Excluded Farmer’s Property From Watershed Acquisition By NYC Not A Regulatory Taking

Petitioner owned a 58–acre dairy farm in the watershed in the Village of Andes, Delaware County. In 2010, the New York Department of Environmental Conservation (“DEC”) issued a 15–year water supply permit authorizing continued land and easement acquisitions by New York City (“City”) within the watershed. This permit was subject to special condition No. 10, which allowed certain geographical areas to be excluded if a municipality promptly passed a resolution designating such locations as hamlet areas. In May 2011, Respondent Andes Town Board adopted Resolution No. 31 of 2011, excluding an area in the Town that encompassed Petitioner's farm from City acquisition. Petitioner commenced this proceeding in July 2011 seeking to annul Resolution No. 31. Petitioner alleged that Respondents failed to follow proper procedures in adopting Resolution No. 31, acted arbitrarily, and that the resolution constituted a de facto taking without just compensation. The Supreme Court dismissed the petition, and Petitioner appealed.

On appeal, the Appellate Division, Third Department held that Resolution No. 31 did not exceed Respondents' authority by restricting ownership or transferability of Petitioner's property. The Court noted that towns have broad authority to regulate land use within their borders, and that the City voluntarily consented not to purchase certain upstate property if local municipalities opted to exclude the property as part of an agreement designed to protect the watershed and save the City significant money while safeguarding the economic vitality of upstate communities. Accordingly, the court was not persuaded by Petitioner's argument that Resolution No. 31 effected a de facto taking for which she is entitled to just compensation. Furthermore, Petitioner had since found another purchaser, and the resolution did not hinder the property’s existing use as a farming operation. Accordingly, the Court affirmed the holding of the New York Supreme Court in favor of the City and dismissed the petition.

The case was Nelson v. City of New York, 117 A.D.3d 1121 (3d Dep’t 2014).

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