HomeMy WebLinkAboutI - 13 Order Judgement & Decision Source Renew, Locust < & Gunzen SolarNYSCEF DOC, NO, 73
PRESENT: IION. OLIVEI2 N. BLAISE, III '
Justice Presiding.
STATE OF NEW YORK
SUPREME COURT :: CORTLAND COUNTY
In the Matter of the Application of
SOURCE RENEWABLES, LLC,
LOCUST SOLAR H, LLC, and
GUNZENIIAUSER REAL ESTATE COMPANY,
Pefrtioners/Plaintiffs,
For a Judgment Pursuant to Article 78 of the
New York Civil Practice Law and Rules,
vs.
TOWN OF CORTLANDVILLE ZONING
BOARD OF APPEALS and
TOWN OF CORTLANDVILLE,
� I (lA�
RECEIVED NYSCEF:
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13
At a Special Term of the. Supreme
Court of the State of New York held
in and for the Sixth Judicial District
via electronic means on the 23rd day
of July, 2021.
ORDER, JUDGMENT &
DECISION
Index No. EF21-092
RJI Year 2021
• Respondents/Defendants. '
APPEARANCES:
COUNSEL FOR PETITIONERS: BARCLAY DAMON LLP
BY: ARI M, GOLDBERG, ESQ.
COREY A. AUERBACH, ESQ.
9276 MAIN ST, SUITE 3
CLARENCE, NY 14031
COUNSEL FOR RESPONDENTS
zoziaoasa EF21-092
II III II IIIIIIII) O IIIIPages 12
Elizabeth
Larkin, iCounty Clerk
NASH CONNORS, P.C.
BY; ANDREW J. KOWALEWSKI, ESQ.
344 DELAWARE AVENUE, SUITE 400
BUFFALO, NY 14202
09/10/.2021
HON. OLIVER N. BLAISE. III. J.S.C.
Petitioners -plaintiffs Source Renewables, LLC, Locust Solar II, LLC, and Gunzenhauser
Real Estate Company have filed this hybrid First Amended Verified Article 78 Petition and
Complaint for a judgment: {i) vacating and annulling the decision of the Towri of Cortlandville's
Zoning Board of Appeals on January 25, 2021 which denied a use variance fora ground -
mounted solar system; (ii) granting the use variance, as requested; (iii) vacating and annulling
the decision of the Town of Cortlaridville's, Zoning Board of Appeals on January 25, 2021 which
denied a use variance for a commercial access road; and (iv) for monetary damages, plus
attorneys' fees and costs.
Respondents -defendants Town of Cortlandville Zoning Board of Appeals and Town of
Cortlandville oppose the Petition/Complaint in all respects and move for an order dismissing the
First Arrtended Verified Article 78 Petition and Complaint pursuant to CPLR §§ 3211 (a) (3) and
(a) (5) and a Judgment pursuant to CPLR § 7804 (fj.
The court heard oral argument of counsel via electronic means on June 1 S, 2021. The
court requested.post-argument briefs, with a final submission date of July 23, 2021.
BACKGROUND
The Parties. the Suhiect Pronerty and the Proiect
Petitioners Gunzenhauser Real Estate Company ("Gunzenhauser") has owned 24.4 acres
of vacant land on Locust Avenue in the Town of Cortlandville, New York since 1963 (the
For ease of reference, the term "petitioner" will be used in place of "petitioner-plaintiffl'.
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HON. OLIVER N. BLAISE. III. J.S.C.
Petitioners -plaintiffs Source Renewables, LLC, Locust Solar II, LLC, and Gunzenhauser
Real Estate Company have filed this hybrid First Amended Verified Article 78 Petition and
Complaint for a judgment: {i) vacating and annulling the decision of the Towri of Cortlandville's
Zoning Board of Appeals on January 25, 2021 which denied a use variance fora ground -
mounted solar system; (ii) granting the use variance, as requested; (iii) vacating and annulling
the decision of the Town of Cortlaridville's, Zoning Board of Appeals on January 25, 2021 which
denied a use variance for a commercial access road; and (iv) for monetary damages, plus
attorneys' fees and costs.
Respondents -defendants Town of Cortlandville Zoning Board of Appeals and Town of
Cortlandville oppose the Petition/Complaint in all respects and move for an order dismissing the
First Arrtended Verified Article 78 Petition and Complaint pursuant to CPLR §§ 3211 (a) (3) and
(a) (5) and a Judgment pursuant to CPLR § 7804 (fj.
The court heard oral argument of counsel via electronic means on June 1 S, 2021. The
court requested.post-argument briefs, with a final submission date of July 23, 2021.
BACKGROUND
The Parties. the Suhiect Pronerty and the Proiect
Petitioners Gunzenhauser Real Estate Company ("Gunzenhauser") has owned 24.4 acres
of vacant land on Locust Avenue in the Town of Cortlandville, New York since 1963 (the
For ease of reference, the term "petitioner" will be used in place of "petitioner-plaintiffl'.
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NYSCEF DOC.- NO ,� 73 ,r vvV-•_` ..-.-.-y- vr, �V `v`� �r • VV �•� RECEIVED NYSCEF: 09/10/2021
"Subject Property"). Petitioner Locust Solar II, LLC ("Locus") is under contract to purchase the
Subject Property from Gunzenhauser. Petitioner Source Renewables, LLC ("Source") is in the
business bf developing community solar facilities and runs over 27 such facilities in New York .
State. Source, Locus acid Gunzenhauser (collectively "petitioners")jointly desire to construct a
community solar facility on 21..6 of the 24 acres of the Subject Property owned by Gunzenhauser
(the "Project").
By all accounts the Subject Property is elevated and essentially vacant land, with a
precipitous slope and shallow bedrock surrounded by NYS Interstate 81, as well as a concrete
plant and hotels.2 The Subject Property is zoned Residential R-1.District under Town Coda §
178-17 s Solar energy systems are not a permitted use in Residential R-1 Districts.. Thus, given
the prohibition of solar energy systems in Residential R-1, Districts, petitioner Source applied to
the Town of Corttarxdvitle Planning Board for a conditional permit and'aquifer protection district .
special permit to authorize the Project. Gunzenhauser authorized Source'to submit the
application as a contract purchaser or contract vendee (NYSCEF Doc No. 40, ¶ 23), . ,
After submission to the Town Plamiing Board, the Project was referred to the Cortland
� .
County Planning Department pursuant to GivIL § 239-m. In May 2020, the County issued a staff
report which recommended approval of a use variance subject to certain criteria and outlining
ZPetitioners'aver that the Subject Property is immediately north of an adjoining parcel located in
the City of Cortland, also owned by Gunzenhauser. Petitioners' represent that a use variance
from the City of Cortland was required to develop the Cortland site as aground -mounted solar
energy system, and that said variance was granted by the City on November 16, 2020.
3A copy of the Town Code was not submitted by either party.
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various concerns such as the sun glare impacting surrounding owners. On September 14, 2020,
the Cortland County Industrial Development Agency, as lead agency, issued a negative SEQRA
declaration for the Project, which included the companion project in the City of Cortland
(NYSCEF Doc No. 43). On October 26; 2020, Source responded to the glare concern by
submitting a Glare Analysis (NYSCEF Doc No. 48).
The Z13A• Hearines and Decision
On November 24, 2020, the ZBA held their first hearing on Source's use variance
application for aground-mountedsolar energy system in a Residential Rl District. The ZBA
considered the Town Law § 267-b use variance criteria, outlined below, and found that Source
had not demonstrated a reasonable return, did demonstrate a unique hardship, did not
demonstrate that the variance would not alter the essential character, and did not demonstrate the
alleged hardship was not self-created (NYSCEF Doc No. 51), •At the request of Source, the ZBA
postponed final determination on the application to allow supplemental submissions.
Thereafter, Source supplemented the record with an Economic, Viability Study (NYSCEF
Doc No. 53). On January 8, 2021, Source further supplemented the record with a "Statutory
Analysis" {NXSCEF Doc No. 55). On January 19, 202I, Source filed three-dimensional
renderings/visual simulations (NYSCEF Doc No. 57).
On January 25, 2021, the ZBA held a second meeting to consider The supplemental ,
submissions. The minutes reflect the following decision with respect to a use variance for the
solar array:
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various concerns such as the sun glare impacting surrounding owners. On September 14, 2020,
the Cortland County Industrial Development Agency, as lead agency, issued a negative SEQRA
declaration for the Project, which included the companion project in the City of Cortland
(NYSCEF Doc No. 43). On October 26; 2020, Source responded to the glare concern by
submitting a Glare Analysis (NYSCEF Doc No. 48).
The Z13A• Hearines and Decision
On November 24, 2020, the ZBA held their first hearing on Source's use variance
application for aground-mountedsolar energy system in a Residential Rl District. The ZBA
considered the Town Law § 267-b use variance criteria, outlined below, and found that Source
had not demonstrated a reasonable return, did demonstrate a unique hardship, did not
demonstrate that the variance would not alter the essential character, and did not demonstrate the
alleged hardship was not self-created (NYSCEF Doc No. 51), •At the request of Source, the ZBA
postponed final determination on the application to allow supplemental submissions.
Thereafter, Source supplemented the record with an Economic, Viability Study (NYSCEF
Doc No. 53). On January 8, 2021, Source further supplemented the record with a "Statutory
Analysis" {NXSCEF Doc No. 55). On January 19, 202I, Source filed three-dimensional
renderings/visual simulations (NYSCEF Doc No. 57).
On January 25, 2021, the ZBA held a second meeting to consider The supplemental ,
submissions. The minutes reflect the following decision with respect to a use variance for the
solar array:
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NYSCEF DOC.• NO.� 73 'r vvv"" vrY-Y` vr, `v, `v`� �` • vV � RECEIVED NYSCEF: 09/20/2021
' 1, Has the Applicant demonstrated that the Applicant cannot realize a
' reasonable return, and that the lack of rettim is substantial and has heen
demonstrated by competent financial evidence?
Finding: Yes. All Board members present agreed,
2, Has the Applicant demonstrated that the alleeed hardship relatine to
the nronerty in question is unique and does not an_ my to a substantial
portion of the district or neiuhborhood?. .
Finding: Yes —Members Bilodeau & Aloi, No =Chair Finn,
Members Potter-Masler &Karam.
3. Has the Applicant demonstrated that the requested use variance, if
granted. will not alter the essential character of the neighborhood?
Finding: No. All Board members present agreed.
4. Has the Annlicant demonstrated that the alleeed hardship has not
been self-created?
Finding: No, All Board members presont agreed.
(NYSCEF Doc No: S8).
This Litigation
On February 24, 2021, petitioners Source and Locust filed and served this Notice of
Petition and Petition. On April 19, 2021, respondents filed their notice of motion to dismiss. On
.May 3, 2021, petitioners filed an Amended Notice of Verified Petition/Summons and First
Amended Fetition/Verified Complaint adding Gunzenhauser Real Estate Company as a
petitioner. On May 18, 2021, respondents filed an attorney affirmation addressing additional
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arguments involving the addition of Gunzenhauser as a petitioner.
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As an overview, petitioners allege that• the ZBA Decision denying a use variance was
contrary to Town Law § 267-b (2) and § 178-83 of the Town's Zoning Ordinance and, therefore, •
was arbitrary and capricious. Further, petitioners allege that the ZBA exceeded its authority
when it denied a use variance for a commercial access road because petitioners never made such
an application. The First Amended PetitionNerified Complaint contains three causes of action,
namely: (1) violation of Town Law § 267-b (2) (b); (2) no variative requested for use variance
for a commercial access road; (3} and regulatory taking. Respondents oppose the petition in all
respects and move to dismiss the same alleging the ZBA Decision had a rational basis.
DTSCUSSTON
Y. .STANDING
Initially, respondents move to dismiss on the grounds that petitioners lack standing
pursuant to CPLR § 3211 (a) (3). More specifically, respondents contend that petitioners Source
and Locus do not have legal standing to maintain this proceeding because they are not owners of
the Subject Property at issue and that Gunzenhauser does not have standing because it failed to
present any evidence inadmissible form demonstrating its ownership of the Subject Property.
On a motion to
dismiss for
lack of'standing, "[t]he burden is on the moving
defendant to
establish, prima facie,
[petitioners']
lack of standing, rather than on
[petitioners) to
affirmatively
establish [their] standing..." (Deutsche Bank Trust Co.'Arus, v Vitedlas, 131 AD3d 52, 59-60 [2d
Dept 2015]). The court finds that respondents have improperly tried to shift the burden by
arguing petitioners have not submitted any proof supporting their standing. Rather, the initial
burden was on respondents and the court finds respondents, as the moving party, have not met
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their burden of submitting proof establishing petitioners,' lank of standing. Accordingly,
respondents' motion to drsrniss based upon petitioners' lack of standing is denied.
II. T'HE ZBA RECISION
Petitioners argue that the ZBA Decision denying their use_ variance for aground -mounted
solar energy system and the commercial access road did not have a rational basis in law or fact
'and is arbitrary, capricious, and an abuse of discretion. In opposition and support of their motion
to dismiss, respondents argue that there is a rational basis for the ZBA decision.¢
The court's review of the ZBA Decision is governed by the doctrine that a decision of a
local zoning board should be sustained so long as it has a rational basis and. is supported by
substantial evidence (Matter of Pecoraro v Board of Appeals of Town of Hempstead, 2 NY3d
608, 613 [2004]).$. Petitioners; as applicants before the ZBA for a use variance, had the burden
of establishing that the "applicable zoning regulations and restrictions have caused unnecessary
hardship" (Town Law §.267-b [2J [bJ). Town Law § 267-b (2) (b) specifically sets forth four
factors that must be proven to establish an unnecessary hardship as fotiows: ,
" 2. Use variances.
(b) [i]n, order to prove such unnecessary hardship the applicant shall
demonstrate to the board of appeals that for each and every permitted use
under the zoning regulations for the particular district where the property
4To the extent that respondents assert that the Town Board is not a properly named party, the
court agrees. Respondents' motion to dismiss this matter as against the Town Board is granted
and the remaining discussion will be. in terms of the solo remaining respondent, the Town of
Cortlandville Zoning Board of Appeals.
SRespondent's Certification of the Record was filed on 7uly 9, 2021 and confirms that exhibits
filed with petitioners' motion papers constitute the contents of the record before the ZBA.
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their burden of submitting proof establishing petitioners,' lank of standing. Accordingly,
respondents' motion to drsrniss based upon petitioners' lack of standing is denied.
II. T'HE ZBA RECISION
Petitioners argue that the ZBA Decision denying their use_ variance for aground -mounted
solar energy system and the commercial access road did not have a rational basis in law or fact
'and is arbitrary, capricious, and an abuse of discretion. In opposition and support of their motion
to dismiss, respondents argue that there is a rational basis for the ZBA decision.¢
The court's review of the ZBA Decision is governed by the doctrine that a decision of a
local zoning board should be sustained so long as it has a rational basis and. is supported by
substantial evidence (Matter of Pecoraro v Board of Appeals of Town of Hempstead, 2 NY3d
608, 613 [2004]).$. Petitioners; as applicants before the ZBA for a use variance, had the burden
of establishing that the "applicable zoning regulations and restrictions have caused unnecessary
hardship" (Town Law §.267-b [2J [bJ). Town Law § 267-b (2) (b) specifically sets forth four
factors that must be proven to establish an unnecessary hardship as fotiows: ,
" 2. Use variances.
(b) [i]n, order to prove such unnecessary hardship the applicant shall
demonstrate to the board of appeals that for each and every permitted use
under the zoning regulations for the particular district where the property
4To the extent that respondents assert that the Town Board is not a properly named party, the
court agrees. Respondents' motion to dismiss this matter as against the Town Board is granted
and the remaining discussion will be. in terms of the solo remaining respondent, the Town of
Cortlandville Zoning Board of Appeals.
SRespondent's Certification of the Record was filed on 7uly 9, 2021 and confirms that exhibits
filed with petitioners' motion papers constitute the contents of the record before the ZBA.
is located, (1) the applicant cannot realize a reasonable return, provided
that lack of return is substantial as demonstrated by competent financial
evidence; (2,) that the alleged hardship relating to the;property in
question is unique, and does not apply to a substantial portion of the
district or neighborhood; (3) that the requested use variance, if granted,
will not alter the essential character of the neighborhood; and (4) that the
alleged hardship has not been self-created."
The court will start its analysis with an examination of the fourth element since it is
dispositive of the matter before the court. Tt is well-settled that "[p]robf that the hardship
imposed ori the landowner by a zoning ordinance is aself-created hardship dictates that an
application for a use variance must fail" whereas a "self-created hardship is only one factor in the
balancing test for area variances [emphases added]" (2, Salkin, New'York Zoning Law and
k�ractice, § 29:10 [4th ed 2020]). The distinction in the treatment of the self-created hardship
between use and area variances confirms that this element can be dispositive in the context of use
variances and, accordingly, is the cotnt's starting point. Generally, case law is clear that if a
buyer acquires properly knowing of adverse zoning restrictions in place at the time of purchase,
then the tesulting hardship is self-created (Matter of Center Sg. Assn., Inc, v City of Albany Bd.
of Zoning.4ppeals, 19 AD3d 968, 971 [3d Dept 2005]). Furthermore, the fact that a prior owner
of property was granted a use variance does not mean that a subsequent purchaser is similarly
entitled, particularly where the evidenoe establishes that the prior use is distinguishable from the
subsequent use (Matter of 194 Main, Inc, v Board of ZoningAppeads for Town of N. Hempstead,
71 AD3d 1028, 1030 [2d Dept 2010]).
Based on this record, itis undisputed that Gunzenhauser purchased the Subject Property
in 1963, the Town Code was adopted in 1986, and the regulation of solar energy systems at issue
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is located, (1) the applicant cannot realize a reasonable return, provided
that lack of return is substantial as demonstrated by competent financial
evidence; (2,) that the alleged hardship relating to the;property in
question is unique, and does not apply to a substantial portion of the
district or neighborhood; (3) that the requested use variance, if granted,
will not alter the essential character of the neighborhood; and (4) that the
alleged hardship has not been self-created."
The court will start its analysis with an examination of the fourth element since it is
dispositive of the matter before the court. Tt is well-settled that "[p]robf that the hardship
imposed ori the landowner by a zoning ordinance is aself-created hardship dictates that an
application for a use variance must fail" whereas a "self-created hardship is only one factor in the
balancing test for area variances [emphases added]" (2, Salkin, New'York Zoning Law and
k�ractice, § 29:10 [4th ed 2020]). The distinction in the treatment of the self-created hardship
between use and area variances confirms that this element can be dispositive in the context of use
variances and, accordingly, is the cotnt's starting point. Generally, case law is clear that if a
buyer acquires properly knowing of adverse zoning restrictions in place at the time of purchase,
then the tesulting hardship is self-created (Matter of Center Sg. Assn., Inc, v City of Albany Bd.
of Zoning.4ppeals, 19 AD3d 968, 971 [3d Dept 2005]). Furthermore, the fact that a prior owner
of property was granted a use variance does not mean that a subsequent purchaser is similarly
entitled, particularly where the evidenoe establishes that the prior use is distinguishable from the
subsequent use (Matter of 194 Main, Inc, v Board of ZoningAppeads for Town of N. Hempstead,
71 AD3d 1028, 1030 [2d Dept 2010]).
Based on this record, itis undisputed that Gunzenhauser purchased the Subject Property
in 1963, the Town Code was adopted in 1986, and the regulation of solar energy systems at issue
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NYSCEF DOC. NO. 73
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here was added in 2018. Thus, Source argues that since the zoning regulations were not in place
at the time of Gunzenhauser's original purchase in 1963; said regulations (the prohibition from
developing aground -mounted solar energy system on the Subject Property) does not apply to
Gunzenhauser, the original owner, and by extension does not apply to Source and Locust. In
petitioners' words, Source and Locust can "step into the shoes" of Gunzenhauser with regard to
the proposed use variance for a solar energy system on Gunzenhauser'�s property. Stated another
way, according to petitioners, if Gunzenhauser would be able to obtain a use variance to erect a
ground=mounted solar energy system, then so, too, should Source and Locust be entitled to such
a usa variance.b
The court finds petitioners' argument unavailing. The court.was unable to locate, nor did
the parties supply, any precedent addressing the specific factual scenario at hand, namely where
a contract purchaser or subsequent owner was entitled to a use.variance based on a prior owner's
entitlement thereto. Rather, it is clear that the right to a use variance is based on the individual
circumstances of each applicant's proposed use (Matter of 194 Main, Inc., 71 AD3d at 1030).
Here, it is critical to note that while Gunzenhauser may have been entitled to obtain a use
variance for the proposed use, it never applied for nor obtained a use variance for a solar energy
system throughout the history of its ownership of the Subject Property, .Thus, Source's proposed
development would be a new use of the Subject Property that is distinct from the use of the prior
bThere is no dispute that Locus contracted to buy the Subject Proper from Gunzetthauser with
knowledge of the zoning restrictions. Indeed, the parties represent that the contract contains a
contingency clause that allows for its termination should the necessary zoning approval not be
obtained for. the solar energy system.
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owner/seller (Gunzenhauser). Tho court fords that the ZBA is not bound by any theoretical use
variance that might have been granted to the original owner for the Subject Property. The
circumstances bf any theoretical prior use variance the ZBA could have granted to the original
owner were and are distinguishable fxom Source's current application to the ZBA (Matter of 194
Main, Inc., 71 AD3d at 1030). The ZBA was entitled to look at Source's proposed use as new
and subject to the applicable zoning restrictions in existence at the time of Source's application,
In fact, taken to its logical extreme, petitioners' argument would allow any applicant to a ZBA to
conduct an end run around otherwise applicable zoning restrictions by pointing to an original
owner whose ownership pre -dated the regulations. Such an outcome would frustrate the
legitimate aims of zoning regulation aitd open the flood gates for similar zoning applications by
developers.
In view of the foregoing, the
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owner/seller (Gunzenhauser). Tho court fords that the ZBA is not bound by any theoretical use
variance that might have been granted to the original owner for the Subject Property. The
circumstances bf any theoretical prior use variance the ZBA could have granted to the original
owner were and are distinguishable fxom Source's current application to the ZBA (Matter of 194
Main, Inc., 71 AD3d at 1030). The ZBA was entitled to look at Source's proposed use as new
and subject to the applicable zoning restrictions in existence at the time of Source's application,
In fact, taken to its logical extreme, petitioners' argument would allow any applicant to a ZBA to
conduct an end run around otherwise applicable zoning restrictions by pointing to an original
owner whose ownership pre -dated the regulations. Such an outcome would frustrate the
legitimate aims of zoning regulation aitd open the flood gates for similar zoning applications by
developers.
In view of the foregoing, the
court finds that the
ZBA had a rational
basis to
conclude
that applicant Source's hardship was
self-created and, as such, deny the use
variance
application.
Having determined that petitioners
have not
meet
their burden nn the self-created
hardship element under Town Law § 267;
the court
need
not address the other elements.
III. REGIILATORY TAKING -
Petitioner's third cause of action alleges the ZBA's denial of the use variance has
eliminated all economically viable use of the Subject Property resulting in a taking without just
compensation in violation of the New 'York and United States Constitutions. In support of this
cause of action, petitioners merely offer broad and sweeping "dollars and cents" statements as
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proof that the Subject'Property isnot capable of producing a reasonable xeturn for each and every
permitted use in the district, thereby equating to a regulatory taking. In opposition and in support
of their motion to dismiss, respondents argue petitioners Source and Locust do not have standing
to make this claim and that petitioner Gunzenhauser has failed to allege sufficient allegations
'establishing a regulatory claim. The court agrees that petitioners' conclusory statements of an
arbitrary denial of a'perinit fails to state a cause of action for a regulatory laking under the New
York State Constitution, the United States Constitution or 42 USC § 1983 (Bawer Assoc, v�Town
of Pleasant Yal., 2 NY3d 617 [2004]). As such, respondent's motion to dismiss the third cause
of action is granted.
The court has considered any remaining arguments and finds them to be without merit.
CONCLUSION
Accordingly, in view of the foregoing, it hereby is ORDERED and ADJUDGED that .
petitioners' First Amended Verified Article 78 Petition and Complaint is DENIED, and
respondents' motion to dismiss is GRANTED and the First Amended Verified Article 78 Petition
and Complaint is DISMISSED in its entirety.
This constitutes the decision, order and judgment of the court.
Dated: September 10th, 2021.
Binghamton, New York
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HON. OLIVER N. B SE, II
Justice, Supreme Court ,
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All papers submitted in connection with this motion, including this Order, Judgment &
Decision, have been electronically filed with the Cortland County Clerk through the NYSCBF
System.
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All papers submitted in connection with this motion, including this Order, Judgment &
Decision, have been electronically filed with the Cortland County Clerk through the NYSCBF
System.
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