Wisconsin town’s action amounted to defacto rezoning in violation of moratorium

by Allison Arends

State Of Wisconsin Ex Rel. Village of Newburg v. Town of Trenton
(Court Of Appeals Of Wisconsin, August 26, 2009)

Wis. Stat 62.23(7a) allows a municipality to temporarily enact a moratorium that prohibits adjacent unincorporated towns from changing the zoning of land within 1.5 miles of the municipality’s boundaries.  The moratorium gives the municipality time to work with each unincorporated town affected to prepare and adopt a comprehensive plan on how the land in that unincorporated town should be used.  The Village of Newburg adopted a temporary moratorium on  land within 1.5 miles of its boundaries for two years as of November 20th 2006. A parcel of land owned by Deerprint Enterprises, LLC, is located within the neighboring Town of Trenton and also within the Village of Newburg’s extraterritorial zoning moratorium. At the time the moratorium was put in place the parcel was zoned residential allowing, “single-family residential development in a farmette, or estate-type setting.”  The zoning did not permit commercial or industrial units.

While the moratorium was in place the Town approved a six-unit condominium development on the Deerprint land.  The development included an existing non-conforming commercial business, bud as part of the development agreement, the Town agreed to language that stated that “additional commercial units may be created… by subdividing all or a portion of the space included within the original commercial/industrial unit to form one or more additional commercial units.”

The Village argued that the Deerprint development included nonconforming mixed uses, and in order for this to be legal the Town must approve a planned development overlay for the parcel which, in turn, would require a rezoning in violation of the Village’s moratorium. The village argues that the approval of Deerprint parcel was invalid without an overlay and that the moratorium prohibits the Town from changing the zoning of the land.

The Wisconsin Court of Appeals addressed the Town’s argument that the Deerprint development is an issue of condominiums and not an issue of rezoning.  The court rejects this argument by pointing out that, “a change in zoning—or other approval under a zoning ordinance—should not be required for condominium conversion, unless a change in the use of the existing property is involved.”  The Village successfully illustrates that Deerprint development changed the use of the existing property and therefore an overlay or rezoning of the property was needed. The Deerprint parcel is zoned residential, yet one of the condominium units is identified as commercial/industrial. The court stated, “ We simply do not understand how a condominium unit set aside for commercial use does not run afoul of a zoning ordinance prohibiting commercial use just because it lies within an otherwise residential condominium.” In addition, the Town itself prohibits mixed uses, like Deerprint’s development, unless it grants an overlay which causes the court to conclude that the Deerprint development is a nonconforming use, and further more, that the Town Board, “rezoned without seeking the necessary approval.”

The Town argued that the case was moot because the moratorium had expired by the time it was heard by the trial court.  The court rejected the Town’s argument by analogy: ” a person who violates a statute is subject to that statute’s consequences, even if the legislature repeals the statute before the opposing party commences or completes its cause of action for the alleged offense.” The court also rejects the Town’s argument that the Village has no standing to seek declaratory relief when the court concludes that the Village has a legally protected interest that stems from its extraterritorial zoning authority, and if the Town was to grant an overlay to Deerprint, then its approval would violate the moratorium providing the Village with standing.

This case, as the court points out, presents an instance where a Town attempts to avoid the restrictions inherent to an extraterritorial zoning moratorium by framing its action as something different than a zoning change, when in reality the Town attempts to hide its approval of commercial building by making it a part of an otherwise residential condominium plan. As a result, the court found the Town’s approval to be “de facto rezoning” and therefore a violation of the Village’s extraterritorial zoning moratorium.

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