Society Created to Reduce Urban Blight, Mary Crawley Tracy, Old City Civic Association, and Kensington South Neighborhood Advisory Council V. The Zoning Board of Adjustment, the City of Philadelphia, Callowhill Center Associates and Metro Lights, LLC

Click Here for the 2009 Court of Common Pleas Opinion.

Click Here for the 2004 Court of Common Pleas Order.

Click Here for the 2002 Commonwealth Court Opinion.

Click Here for the 2002 Court of Common Pleas Opinion.

Case History

July 9, 2009:  Judge Idee C. Fox of the Court of common Pleas issued an Opinion which upheld the ZBA's denial of zonign and use variances pursued by the owner for the proposed 9750 square foot wall-wrap at 417 North 7th Street and also found that the ZBA did not err in finding hte relevatn sections of the zoning code constitutional and enforceable.

July 12, 2007- September 23, 2008: Owner filed an appeal to the Court of Common Pleas of the ZBA's denial. ZBA submitted the record and its findings and conclusions of law to the Court.  Owner filed Motions to Quash or Dismiss SCRUB and community groups as intervenors for lack of standing.  ZBA was directed twice to develop a record regarding this.  The ZBA took no action.  Pursuant to discussion with Counsel, but without waiver of standing issue, the appeal to the Common Pleas Court permitted to proceed.  Oral argument was heard from all parties.

June 13, 2007: ZBA denied the variance request of the owner and also found the City ordinances in question valid.

August 16, 2006: Owner applied for a new variance after losing first appeal to United States Supreme Court. Final hearing held, awaiting the decision of the Zoning Board.

May 17th, 2006: Case heard again by the ZBA. Continuance granted for a later date.

April 5th, 2006: Case reheard by the ZBA. Continuance granted for a later date.

February 15, 2006: Applicant is reapplying for a wallwrap permit.

March 7, 2005: The offending wall wrap was removed by the City and the owner charged for the cost of removal.

February 28, 2005: Working over the weekend, the property owner installed a wall wrap in flagrant violation of not only city law, but also Commonwealth Court Judge Silberstein's previous decision.

March 19, 2004: The City agreed to stay the decision for 60 days while the defendants' appeal to Commonwealth Court.

March 1, 2004: Judge Alan K. Silberstein ordered the wall wrap removed, the owner fined over $65,000, and all advertising revenue forfeited and placed in a trust for the benefit of the citizens of Philadelphia.

June 2, 2003: The U.S. Supreme Court denied certiorari.

January 2003: Upon receipt of the decision of the Supreme Court of Pennsylvania, the City of Philadelphia filed an action in the Court of Common Pleas seeking enforcement of the Supreme Court's decision

December 17, 2002: The Supreme Court denied the Application for Stay and Injunctive Relief . The Petition for Allowance of Appeal was also denied.

July 11, 2002: Pennsylvania Commonwealth Court upheld Common Pleas Decision.

November 27, 2001: Court of Common Pleas reversed the grant of a variance.

April 5, 2001: ZBA granted a variance to erect an outdoor advertising sign on the grounds that the Applicants would suffer an unnecessary hardship if the variance was not granted

Februrary 2000: Applicants applied to L&I for a permit for a proposed sign which was identical in proportion to the existing sign, but L&I rejected on the grounds that it violated the outdoor advertising requirements of Section 14-506, 14-1404, and 14-1604.1.

1999: Applicants erected a 65 foot by 100 foot non-accessory sign on the wall of a building located on North 7th Street in Philadelphia. They did not apply for a permit.

Facts

In 1999, Callowhill Center Associates ("CCA") erected a 65 foot by 100 foot non-accessory sign on the wall of a building located on North 7th Street in Philadelphia. In February 2000, after the sign had been in place for one year, CCA applied to L & I for zoning and use permits for a proposed sign, which was identical in proportion to the existing sign. L & I rejected the application because the sign would violate the outdoor advertising requirements of Sections 14-506, 14-1604 and 14-1604.1 of the zoning code.

Applicants appealed to the Board but did not dispute that the sign violates the zoning code. Instead, they argued that a variance should be granted. They presented the testimony of a representative of the owner of the building upon which the sign is to be placed. The representative testified that the building had been purchased from the Philadelphia school district in 1986. He noted that, at the time of the hearing, the building was 70 to 80% occupied by commercial tenants. In 2000 the facade of the building required repair and replacement of windows at a cost of $ 4.8 million. He explained that rental income was insufficient to fund the building repairs and maintained that renovations to the building would not have been possible without the sign revenue.

In opposition, SCRUB, the Olde City Civic Association, and the Kensington South Neighborhood Advisory Council (collectively Objectors) presented testimony that the sign was blight. They also presented the testimony of an architect and city planner who opined that the sign violated the zoning code and would reduce the quality of the visual and aesthetic environment. Additionally, the Philadelphia Planning Commission submitted a report recommending that the variance be denied in light of the numerous violations of the zoning code.

The Board granted the variance. The Board concluded that the applicants would suffer an unnecessary hardship if the variance was not granted as their ability to fund the building repairs would be compromised.

On appeal, the trial court reversed, concluding that applicants did not suffer the required hardship. The trial court reasoned that, because the building was 70 to 80% occupied by commercial tenants when the sign was erected, the loss of the sign revenue did not render the property valueless. In addition, the trial court found that applicants waived several arguments including a constitutional challenge to Sections 14-1604 and 14-1604.1 of the zoning code. Applicants filed a timely appeal to the Pa. Commonwealth court.

The appellate court concluded the applicants waived the constitutional arguments, questioning the validity of the zoning code as a prior restraint on commercial speech and as exclusionary zoning, by failing to raise them before the Board. Further, the appellate court disagreed with the applicants that the trial court erred by reversing the Board's grant of the variance. The appellate court reasoned that the Board erred as a matter of law by granting the variance when the applicants did not demonstrate the required showing of unnecessary hardship. Finally, the appellate court's review of the record revealed the applicants' sign fell within the definition of the term "sign" under Philadelphia, Pa., Zoning Code § 14-102(86).

Issue

Whether the trial court erred in ruling that they waived arguments that had not been raised before the Board?

Whether the trial court erred by reversing the Board's grant of a variance?

Whether the zoning code is applicable to applicants' wall wrap, which drapes the side of the building like a banner?

Rule of Law

Section 1005-A of the Pennsylvania Municipalities Planning Code provides that, upon motion by the parties, the trial court may receive additional evidence if necessary for proper consideration of the appeal. If parties do not request that the trial court hear additional evidence, they waive arguments which were not raised before the board.

A party seeking a variance bears the burden of proving that an unnecessary hardship will result if the variance is not granted and also that the variance will not be contrary to the public interest. Absent a finding that property will be rendered valueless, financial hardship alone is not a sufficient basis for granting a variance. Property owners do not have a right to utilize land for their highest and best financial gain. The loss of rental income from disallowed outdoor advertising signs was not an unnecessary hardship.

Under Phila. code 14-102(86) the term "sign" is defined as follows: A name, identification, description, emblem, display or structure which is affixed to, or printed on, or represented directly upon a building, structure or parcel of land.

Holding

Applicants failed to raise their constitutional arguments before the Board. As a result, the Board was unable to compile an adequate record for determination of those issues. Likewise, the record reveals no request that the trial court permit enlargement of the record. The City of Philadelphia was not aware of the attack on the zoning code at a time when it could create a record in defense of constitutionality. Consequently, the trial court found that the arguments were waived. We agree that Applicants waived all arguments not raised before the Board, including the argument that the zoning code is unconstitutional.

The trial court did not err in reversing the Board's decision to grant a variance because the applicants did not suffer an undue hardship. The law is well settled that a mere showing of economic hardship or that a property could be utilized more profitably is insufficient to support the grant of a variance. Without the variance the property maintains 70 - 80% occupancy and the fact that the variance would allow the property owner to raise additional funds to pay for needed renovations does not meet the level of undue hardship.

Our review of the record reveals that Applicants' sign falls within that definition.

Accordingly, we affirm the lower courts' decision.