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

Apellant Ranco Sand and Stone Corporation (“Ranco”) owned two contiguous parcels of property in the Town of Smithtown that were zoned for residential use. In 1997, Ranco leased Parcel One to a private school bus company, which used it as a bus yard and trucking station. Although this use was unapproved and nonconforming, the Town did not enforce the residential zoning requirements. Even so, in 2002 Ranco applied to rezone Parcel One for heavy industrial use. The Town Board issued positive declaration pursuant to the State Environmental Quality Review Act (“SEQRA”) that the rezoning may significantly impact the environment, and requiring Ranco prepare and submit a draft environmental impact statement (“DEIS”). Ranco commenced this CPLR article 78 proceeding against 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 Ranco’s application without a DEIS.

Ranco asserted that the declaration imposed a hardship on the company, as the allegedly unnecessary DEIS would cost between $75,000 and $150,000.  In support of its claim that the DEIS was unnecessary, Ranco cited the prior rezoning of the contiguous parcel (Parcel Two) for heavy industrial use, which was approved 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 Parcel One. Respondents moved to dismiss for failure to state a cause of action. The Supreme Court granted the motion, holding the matter was not ripe for judicial review, and the Appellate Division affirmed, noting 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.

On appeal, the Court of Appeals affirmed that the issue was not ripe for review. The Court found that the obligation imposed on Ranco, both as a lump sum of $75,000 to $150,000 annd percentage of the rentals collected under the Parcel One lease, satisfied the first requirement of the ripeness 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 insufficient, without more, to distinguish its 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.  The Court thus affirmed the dismissal of the petition without addressing Ranco’s claims on the merits.

The case was Ranco Sand and Stone Corp. v Vecchio, 27 N.Y.3d 92 (2016).

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