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Britwood Urban Renewal, LLC v. City of Asbury Park

April 20, 2005


On appeal from the Superior Court of New Jersey, Law Division, Monmouth County, Docket No. L-2969-03.

Before Judges Cuff, Weissbard and Hoens.

The opinion of the court was delivered by: Hoens, J.A.D.


Argued December 6, 2004

This appeal arises in the context of the on-going efforts to redevelop the waterfront in the City of Asbury Park. As such, it raises numerous issues of first impression. More specifically, in this appeal we consider the relationship between the provisions of the Local Redevelopment and Housing Law, N.J.S.A. 40A:12A-1 to -49 (LRHL), and the Municipal Land Use Law, N.J.S.A. 40:55D-1 to -163 (MLUL), as those provisions affect the City's authority to require contributions toward the cost of off-site infrastructure improvements. We also address issues concerning the statutory definition of a redeveloper and the technical definition of a Subsequent Developer as they relate to the City's authority to require off-site infrastructure improvement contributions. Further, the appeal raises issues relating to the scope of the Planning Board's authority in the redevelopment context. Finally, we consider the authority of the City to impose contributions toward anticipated off-site infrastructure costs, by ordinance or otherwise, on properties within the redevelopment zone following final site plan approval.

Plaintiff Britwood Urban Renewal, LLC appeals from the February 9, 2004 order of the Law Division that denied plaintiff's motion for summary judgment, that granted the cross-motions for summary judgment filed by defendant City of Asbury Park and intervenor Asbury Partners, LLC and that dismissed plaintiff's complaint. Since the time of the order, plaintiff has been required to deposit a total of $300,000 in an escrow account. We reverse.

The facts that are relevant to the issues on appeal are as follows. Plaintiff owns a thirty-one unit apartment building in Asbury Park. The building was originally constructed in the 1920s and each unit has an existing water and sewer connection. Plaintiff's deed and the tax map designated the property as Block 159, Lot 24. The property is also commonly known as 218 Second Avenue in the City of Asbury Park. On August 1, 1984, long before plaintiff purchased its property, the Asbury Park City Council adopted a resolution approving a report by the Asbury Park Planning Board that determined that certain areas along the Asbury Park oceanfront qualified as "areas in need of redevelopment." The designation of the area, also known as the Waterfront Redevelopment Zone, included the property that was subsequently acquired by plaintiff.

After the 1984 adoption of the first redevelopment resolution, several entities not parties to this dispute held redevelopment rights or were engaged to be the City's designated redeveloper. In 2002, the City hired Asbury Partners to undertake a new study of the Waterfront Redevelopment Zone. Shortly thereafter, Asbury Partners, with assistance from a consulting firm, Clarke Caton Hintz, drafted the proposed Waterfront Redevelopment Plan. On or about January 16, 2002, the City Council directed the Asbury Park Planning Board to review the proposed Waterfront Redevelopment Plan pursuant to the provisions of the Local Redevelopment and Housing Law, N.J.S.A. 40A:12A-1 to -49 (LRHL).

On April 26, 2002, the Planning Board issued the report of its findings and its proposed changes to the Waterfront Redevelopment Plan. On June 5, 2002, the City Council adopted Ordinance 2607, which accepted the Waterfront Redevelopment Plan that had been proposed by Asbury Partners and adopted some, but not all, of the changes that had been proposed by the Planning Board.

The Plan listed plaintiff's property "within the prime renewal area" and designated it as a property that Asbury Park "will, at the request of the developer, acquire, through the power of eminent domain." The Plan also included plaintiff's property in its list of historic and/or significant buildings. It acknowledged that plaintiff's building, known as the Britwoods Court Apartments, was vacant and concluded that the property "must be completely renovated to be compatible with the new development proposed for this block." However, the Plan specifically exempted plaintiff's property from condemnation if its owner started the needed renovations "within one year of the adoption of this plan."

The Plan also required, in general, "upgrades to the existing infrastructure in order to accommodate the proposed development and ensure a reliable utility base for the City of Asbury Park." A list of "involved utilities" included sanitary sewer and storm sewer, each of which was designated as the City's responsibility.

In addition to adopting the Plan, the City Council also considered several Planning Board recommendations, including two that are relevant to this appeal. First, "[t]he [Planning] Board recommend[ed] that private property owners have the right to develop their properties consistent with the Redevelopment Plan and they understand that the development will require contribution for offsite, off-track improvements." Second, the Planning Board recommended an amendment to the Master Plan to include "a circulation and public utility element," without which Asbury Park could not require contributions from individual developers for off-site improvements.

The City Council, as a part of its consideration of the Plan and its adoption of Ordinance 2607, rejected these recommendations as inconsistent with the philosophy of the prior redevelopment agreements which authorized a single developer. The Ordinance instead permitted property owners to negotiate with Asbury Partners "to obtain developer status and submit plans which could include their property for an entire project which would be subject to review by the Planning Board and the redevelopment authority."

On October 28, 2002, the City and Asbury Partners entered into the Amended and Restated Redeveloper and Land Disposition Agreement. That agreement designated Asbury Partners as "the exclusive Master Developer of the Asbury Park Waterfront Redevelopment Area," pursuant to the Plan. The agreement superseded and substituted for all prior agreements with all predecessor developers. Pursuant to the terms of that agreement, Asbury Partners "has and may acquire and clear land for subsequent redevelopment by other qualified developers ('Subsequent Developers')." The agreement defined a "Subsequent Developer" to be "a purchaser, assignee or transferee of Master Developer's rights, interest and/or title in or to part of the Project."

Of particular relevance to the dispute between the parties, the agreement provided that Asbury Partners was responsible for "the construction of infrastructure improvements," which would be paid for by fees assessed to Subsequent Developers. The agreement defined "Infrastructure Improvements" as "those public utility, street, traffic signalization and walkway, park, lighting and landscape improvements to be constructed and funded by the Master Developer." Further, the agreement provided as follows:

The parties agree that the Master Developer shall be responsible for the costs of all reasonable infrastructure repairs or improvements within the Redevelopment Area, whether associated with property it develops, sells to, or causes a Subsequent Developer to develop or rehabilitate.

The parties further agree th[at] Plan IV [the Plan] contemplates a fair and equal distribution of the infrastructure costs by the new buildings and that the acquisition and construction outlined therein is critical to the infrastructure funding and construction.

In connection with infrastructure improvements, Asbury Partners represented that it had retained an engineering firm to review, among other things, existing sewer, water and other utilities, as well as traffic and street patterns and signals. It agreed to share that firm's report with the City, after which the parties agreed that they would "review the report and agree to a reasonable schedule, estimated cost, type and method of repair of infrastructure components in the Redevelopment Area." Although no report or cost estimate is included in the record, and although ...

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