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Citizens for a Better Flathead v. Board of County Commissioners of Flathead County

Supreme Court of Montana

December 13, 2016

CITIZENS FOR A BETTER FLATHEAD, a Montana non-profit public benefit corporation and SHARON DeMEESTER, Plaintiffs, Appellees and Cross-Appellants,
v.
BOARD OF COUNTY COMMISSIONERS OF FLATHEAD COUNTY, a political subdivision of the State of Montana and the governing body of the County of Flathead, acting by and through James R. Dupont, Pamela Holmquist and Dale W. Lauman, Defendant and Appellant. And MARILYN NOONAN, RICK MYERS, ERIC WUTKE, HUMANE SOCIETY OF NORTHWEST MONTANA, SKYLINK FIBER COMMUNICATIONS, LLC and JUMP INVESTMENTS, Intervenors Below.

          Submitted on Briefs: June 29, 2016

         District Court of the Eleventh Judicial District, In and For the County of Flathead, Cause No. DV-2012-010 Honorable David M. Ortley, Presiding Judge

          For Appellant: Alan F. McCormick, Garlington, Lohn & Robinson, PLLP, Missoula, Montana

          For Appellees: Roger M. Sullivan, Ethan Welder, McGarvey, Heberling, Sullivan & Lacey, P.C., Kalispell, Montana

          For Intervenors: Noah H. Bodman, Tami E. Fisher, Fisher & Bodman, PC, Kalispell, Montana

          OPINION

          Jim Rice Justice

         ¶1 The Board of County Commissioners of Flathead County (Commissioners or Commission) appeal from the order of the Eleventh Judicial District Court, Flathead County, granting summary judgment to Appellees and Cross-Appellants Citizens for a Better Flathead and Sharon DeMeester (collectively Citizens), who had challenged zoning actions taken by the Commission. Due to uncertainty over the scope of relief granted by the District Court's order, Citizens has cross-appealed from any partial denial of the relief it sought. We affirm in part and reverse in part.

         ¶2 We consider the following issues:

1. Did the District Court err by holding that the Map Amendment was invalid for failing to comply with statutory requirements?
2. Did the District Court err by failing to invalidate the Text Amendment for violating statutory obligations and public participation requirements?
3. Did the District Court err by granting attorneys' fees to Citizens?

         FACTUAL AND PROCEDURAL BACKGROUND

         ¶3 Two zoning actions are at issue in this proceeding. First, by Resolution No. 955 HL, the Commission enacted an amendment to the Flathead County Zoning Regulations (FCZR) that created a new zoning classification, called the General Business Highway Greenbelt, or B-2HG. This is known as the "Text Amendment." Second, by Resolution No. 837 BX, the Commission approved an "on-the-ground" zoning change, applying the new B-2HG classification to particular property bordering Highway 93, north of Kalispell. This is known as the "Map Amendment."

         ¶4 Following the adoption of the Flathead County Growth Policy (Growth Policy)[1] in 2007, owners of property lying north of Kalispell on Highway 93 approached the Flathead County Planning and Zoning Office (Planning Office) about changing the zoning of their properties from a combination of Agricultural (AG) and Suburban Agriculture (SAG) classifications to General Business (B-2). The Flathead County planning staff explained that such a change would not be feasible because (1) there was uncertainty regarding such changes due to the Growth Policy's lack of guidance in that area of the County; and (2) the B-2 zoning classification had substantial differences from both the AG and SAG classifications.

         ¶5 Several years later, in 2010, owners of property on Highway 93, north of Kalispell, proposed the creation of a mitigated commercial zone for use on major highways corridors in Flathead County. Labeled B-2HG, this highway greenbelt category would permit many of the same uses as in B-2, General Business, but also establish conditional uses that would require approval from the Planning Office, as well as mitigation measures to alleviate the impacts between AG/SAG zoning and B-2 zoning, such as setbacks, landscaping, signage requirements, tiered building heights arising from the highway, and additional lighting restrictions to minimize light intrusions on neighboring property. The proposed B-2HG district stated three categories of uses: (1) permitted uses (uses allowed without further review, including banks, barber shops, bed and breakfast operations, hotels, and food stores with less than 5, 000 square feet of gross floor area); (2) conditional uses (uses that are permissible but which require a public hearing, including bars and casinos, gas stations, funeral homes, farm equipment sales, supermarkets over 5, 000 square feet, and others); and (3) administrative conditional uses (uses that require county review, but do not require a public hearing, including lumber yards, day care centers, boat sales, and rental service stores and yards).

         ¶6 Following consultation with the Planning Office, the landowners submitted an application for adoption of the Text Amendment to amend the zoning ordinances to create the B-2HG zoning district. The landowners also submitted a request for the Map Amendment to change the zoning of their particular properties, an area covering 63 acres, to B-2HG, if the Text Amendment was first approved.

         ¶7 The Planning Office staff prepared a report (Text Report) on the proposed Text Amendment. Citing Montana Code and FCZR, the Text Report stated that the proposed B-2HG classification would advance three parts of the Growth Policy: (1) "Provide ample commercial land designation to promote affordability" (Policy 6.3); (2) "Encourage small-scale, impact-mitigated and compatible commercial developments in accessible, developing rural areas with good access and away from urban areas" (Policy 7.3); and (3) "Identify existing areas that are suitable for impact-mitigated commercial uses" (Policy 7.4). The Text Report also addressed the statutory considerations required by § 76-2-203, MCA, including fire dangers; promotion of health, public safety, and general welfare; facilitating adequate provision of transportation, water, sewer, schools, parks, and other public requirements; compatibility with urban growth in the area; the character of the district and its peculiar suitability for particular uses; and whether the proposed Text Amendment would be compatible with ordinances of the surrounding municipalities.

         ¶8 Specifically, the Text Report stated that Flathead County did not have a "building department" like the cities of Whitefish and Kalispell, but that the proposed amendment contained "additional criteria for the site development similar to criteria used by the cities" and gave consideration to the growth of nearby municipalities "because the text of the proposed amendment provides for standards that are similar to neighboring municipality's standards for highway commercial standards." The Text Report noted that although this particular zoning ordinance did not exist in area municipalities, similar municipal ordinances had been consulted for guidance, and that "[p]ortions of the proposed amendment were based upon regulations adopted by local municipalities."

         ¶9 After notice, the Commission conducted a public hearing on May 17, 2011. Proponents and opponents of the Text Amendment offered public comment, after which Commissioner Holmquist stated she would take the comments under consideration. Commissioner Lauman said that "issues expressed . . . need [to be] addressed" and stated a "concern regarding which public roads would be affected." Chairman Dupont asked the Planning Board to address the concerns raised.

         ¶10 On May 31, 2011, the Commissioners met to discuss changes to the proposed Text Amendment. Public comment was again taken and six citizens spoke in opposition. The Commissioners discussed potential locations where the B-2HG zone could be applied, but clarified that adopting the Text Amendment would not automatically zone any piece of property, but only provide another "tool in the toolbox" for zoning. The Commissioners adopted changes to the Text Amendment that had been suggested in the multiple public workshops conducted by the Planning Board, and published notice of their intent to adopt the Text Amendment as amended.

         ¶11 On July 27, 2011, the Commission held its final hearing regarding the Text Amendment. It was reported that, during the statutory protest period, 881 protests to the Text Amendment were received, which was insufficient to legally block its adoption. Commissioner Holmquist said that she had read through all the protest letters, indicating that they included "inaccurate and scare tactic information" and that the "B2HG is not replacing B2 zoning, and it does not cover every road in the county; it is only on major arterial roads." Commissioner Lauman said he "spent a lot of time" reading through the protests and petitions received, and expressed "concerns about the quality of information put out there [regarding the B-2HG Text Amendment]." He stated that he did "not see where B2HG zoning would impose anything on anyone that they can't already do." Chairman Dupont concurred, noting that "if [the B-2HG Text Amendment] passed today it would be an option for zoning that a property owner can choose from to further restrict development of their property." The Commission unanimously adopted the Text Amendment.

         ¶12 On August 7, 2011, the landowners requested that their proposed Map Amendment be adopted by the Commission, which would change the zoning of their property from SAG to the newly created B-2HG zone. The Planning Office's report (Map Report) analyzed whether the Map Amendment substantially complied with the Growth Policy and met the requirements of § 76-2-203, MCA. The Map Report noted six policies in the Growth Policy that "may be relevant": (1) "Provide ample commercial land designation to promote affordability" (Policy 6.3); (2) "Require traffic impact analysis for all major commercial projects on major highways and arterials" (Policy 6.4); (3) "Conserve resources and minimize transportation demand by encouraging redevelopment and infill of existing commercial areas" (Policy 6.5); (4) "Encourage small-scale, impact-mitigated and compatible commercial developments in accessible, developing rural areas with good access and away from urban areas" (Policy 7.3); (5) "Identify existing areas that are suitable for impact-mitigated commercial uses" (Policy 7.4); and (6) "Encourage commercial development that is visually and functionally desirable" (Policy 7.5). The Map Report generally concluded that these policies would be furthered by zoning the land in question as B-2HG, but noted that the proposed zoning change would not provide infill. The Map Report also noted two problems that required "careful Planning Board and Commission consideration": (1) the lack of specific guidance regarding the Highway 93 area, because there was no neighborhood plan or future use map; and (2) the potential lack of compatible growth with nearby municipalities. The Planning Board voted to approve the Map Amendment. After review, the Commission made several changes to the Map Amendment and unanimously adopted it on February 14, 2012.

         ¶13 Citizens initiated this action, challenging the Commission's adoption of both the Text Amendment and the Map Amendment. Both sides moved for summary judgment. The District Court held that "the map amendments along with the zone change on the land in question are voided" for failing to substantially comply with the Flathead County Growth Policy; that the Commissioners' actions in rezoning the 63 acres constituted illegal spot zoning; and that Citizens were entitled to an award of attorney fees and costs.

         STANDARDS OF REVIEW

         ¶14 We review a district court's grant of summary judgment de novo, applying the same criteria as the district court. Siebken v. Voderberg, 2012 MT 291, ¶ 16, 367 Mont. 344, 291 P.3d 572; N. 93 Neighbors, Inc. v. Bd. of Cnty. Comm'rs, 2006 MT 132, ¶ 17, 332 Mont. 327, 137 P.3d 557. A de novo review is one that is "anew" from beginning to end. White Sulphur Springs v. Voise, 136 Mont. 1, 5, 343 P.2d 855, 857 (1959).

         ¶15 Amendment of a zoning designation constitutes a legislative act. Section 7-1-104, MCA; Schanz v. City of Billings, 182 Mont. 328, 335, 597 P.2d 67, 71 (1979); N. 93 Neighbors, ¶ 18; Lake County First v. Polson City Council, 2009 MT 322, ¶ 37, 352 Mont. 489, 218 P.3d 816. We presume legislative acts are valid and reasonable, Lake County First, ¶ 37; Schanz, 182 Mont. at 335, 597 P.2d at 71, and review only for an abuse of discretion. N. 93 Neighbors, ¶ 18; Lake County First, ¶ 37. A district court abuses its discretion if it acted "arbitrarily without the employment of conscientious judgment, or exceeds the bounds of reason resulting in substantial injustice." State v. Sage, 2010 MT 156, ¶ 21, 357 Mont. 99, 235 P.3d 1284. A district court may also abuse its discretion if it bases its decision on information "so lacking in fact and foundation that it is clearly unreasonable." Lake County First, ¶ 34 (internal quotations omitted) (citing N. 93 Neighbors, ¶ 44; Schanz, 182 Mont. at 335-36, 597 P.2d at 71).

         DISCUSSION

         ¶16 1. Did the District Court err by holding that the Map Amendment was invalid for failing to comply with statutory requirements?

         ¶17 The Commission argues that the District Court's determination that the Map Amendment failed to substantially comply with the County's Growth Policy was based upon factual errors, incorrect legal conclusions, and a failure to consider whether the Commission's decision was supported with an adequate record and analysis. Citizens answer that the record "unequivocally demonstrates" that the Commission failed to even consider, let alone "be guided by, " important elements of the Growth Policy.

         ¶18 When adopting zoning regulations, "the board of county commissioners shall consider":

(a) reasonable provision of adequate light and air; (b) the effect on motorized and nonmotorized transportation systems; (c) compatible urban growth in the vicinity of cities and towns that at a minimum must include the areas around municipalities; (d) the character of the district and its peculiar suitability for particular uses; and (e) conserving the value of ...

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