Feds Sue Berkeley Over Historic Zoning Overlay Ordinance.

Historic-District-OverlayIn April, 2016, the Postal Service through the Department of Justice, threatened to sue Berkeley if Berkeley did not rescind the Historic District Zoning Overlay Ordinance, passed in September of 2014, that made most commercial uses of the zone (see right) – which includes the Post Office at 2000 Allston Way (8) – illegal.

This ordinance was passed in the middle of a four-year fight to save the downtown Berkeley Post Office from sale and privatization, begun in 2012 and ended, at least temporarily, by a Federal Judge’s decision in April of 2015.

On August 22nd, 2016, after the Berkeley City Council over the summer essentially refused – by neither formally replying to the DoJ threat letter nor voting to rescind the ordinance – the Postal Service carried through with their threat. (C.f. The actual complaint as a PDF: Complaint-08-22-16).

The complaint claims that the Supremacy Clause of the US Constitution forbids Berkeley from rezoning the 2000 Allston Way property because it interferes with the mandate Congress gave the Postal Service to manage Postal properties by diminishing the value of the property and thus making it harder to sell. This argument stands in potential conflict with various Supreme Court decisions, including Euclid v Ambler. As Wikipedia puts it

In 1926 the United States Supreme Court upheld zoning as a right of U.S. states (typically via their cities and counties) to impose on landowners.

There is also a case, Penn Central v NYC (1978) which helps to define when a “taking” occurs via zoning that would be subject to compensation.  Here is a summary analysis of the case by one legal firm:

For a landowner to successfully challenge a zoning ordinance, courts will generally require proof that (1) the ordinance left little or no economically viable use of the land, (2) there is no legitimate government interest being advanced by the zoning classification, or (3) the classification is purely arbitrary and capricious. Developers must be cautious in purchasing land, as the court has clearly indicated that the purchaser assumes the risk that an application for rezoning will be denied. Local governments have broad discretion to enact reasonable zoning regulations that further legitimate government interests, such as controlling growth and maintaining open space.

While there is nothing I know of as a court decision directly related to the pre-sale zoning of Federal property per se by a State or municipality, it is understood that zoning DOES NOT, per se, apply to property owned by the Federal or State government (or, for example, the Regents of California). E.g., Wikipedia states that “Federal lands are not subject to state planning controls.”  Indeed, it was understood (or at least I understood) at the time the Zoning Overlay ordinance was passed, that should the Federal government wish, e.g., to rent the unused space at 2000 Allston Way to McDonald’s that Berkeley would have no recourse, regardless of the new ordinance.  In other words, the Zoning Overlay only has actual restrictive effect AFTER the property is sold to a non-state entity.

Clearly a zoning ordinance can have an effect on the value of the property, but whether changing the zoning in an area containing Federal property thus violates the Supremacy Clause of the US Constitution may not be settled until the case reaches the US Supreme Court, if it ever does.

The next move, it appears, is Berkeley’s.



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