When Public Approval Means Naught: How Federal Judges Are Delaying 4,000 Units Of D.C. Housing
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In every corner of Washington, D.C., development sites that would add almost 4,000 apartments to the District's housing stock sit quiet.
Standing in their way are small groups of activists and sympathetic federally appointed judges that have increasingly challenged the decisions of local planners and neighborhood groups.
Two recent cases in which the D.C. Court of Appeals vacated Zoning Commission approvals have exposed what developers and city officials are calling a flawed process with harmful consequences, and the decisions have emboldened development opponents.
Eleven projects that have been approved by the Zoning Commission currently face appeal, in addition to the two the court has recently blocked, 901 Monroe St. in Brookland and the 25-acre McMillan Sand Filtration site.
According to a review of court and planning documents, these 13 projects and their combined 3,986 housing units, at least 1,400 of which are set aside as affordable, sit in limbo as builders await the court’s decision. Additionally, an untold number of units will never see the light of day as developers begin to shy away from the process that allows them to build more density while exposing them to more legal appeals.
These appeals, and the willingness of judges to see them through, have become more frequent in recent years. Fifty-seven zoning appeals have been filed in the D.C. Court of Appeals since the start of 2013, the year the 901 Monroe project was first blocked, compared with 28 appeals filed between 2000 and 2012. Before 901 Monroe, the last time the court remanded a project back to the Zoning Commission was in 1995.
Click on the icons in the map below to see information about each of the projects facing appeal:
“It does seem more frequent, and I think some activists are more aggressive than they used to be,” said PN Hoffman CEO Monty Hoffman, who has been developing in D.C. for 25 years. “They are not looking out for the greater good. They have a certain agenda or self-interest.”
One activist, one attorney and one judge have been centrally involved in stalling the majority of these projects, and many developers and planners blame them for restricting the District's housing supply and stifling the city's growth.
"It is hard to understand what these NIMBYs think they have accomplished," said former D.C. Director of Planning Ellen McCarthy, who now consults and teaches urban planning at Georgetown University. "They’ve reduced the total number of residential units being produced, making it harder for people to find places to live and keeping prices high, decreased the number of affordable units that are going to be produced, and reduced the amount of attractive public spaces created."
The proposal to build a 220-unit apartment building one block south of the Brookland Metro station at 901 Monroe St. NE has received Zoning Commission approval three times since it was first proposed in 2010, and the appeals court has vacated the approval every time, most recently in May 2016.
“It is not a good thing for the District of Columbia, residents of the neighborhood or anybody for it to sit there as an empty site,” the site's developer, Menkiti Group founder Bo Menkiti, said. “It’s an example of when a broken process ends up hurting the whole community.”
Criticism from local public officials has grown louder since the court reversed the approval of McMillan, a 677-unit development on a vacant sand filtration site at North Capitol Street and Michigan Avenue NW, where the District is partnering with developers to build housing, medical office buildings, retail and a public park.
“I’m extremely frustrated that so many mixed-use developments are being held up by the courts right now,” Council member David Grosso said in an email. “We have a robust PUD system in D.C. which includes a locally appointed Zoning Commission that receives input from community groups and city agencies. Federal judges — whom District residents have no role at all in appointing — should not be so quick to delay projects which have broad community support.”
How Projects End Up In Appeals Court
In order to build more than a site’s existing zoning allows, developers must file a planned-unit development application. In exchange for flexibility from existing zoning, which often means adding density, height or switching a building's use, developers agree to set aside a certain number of units as affordable and provide other public benefits.
Before the Zoning Commission approves a PUD, it holds public hearings where those potentially impacted by the project can speak out, and the local Advisory Neighborhood Commission, made up of neighborhood residents, can weigh in. The Zoning Commission then balances any potential adverse affects with the public benefits of a project and determines if it fits within the Comprehensive Plan guidelines.
“We have a strong process, an independent Zoning Commission, we have ANCs,” Chief of Staff to the Deputy Mayor for Planning and Economic Development Andrew Trueblood said. “No matter what you feel about it, at the end of the day this is a strong, democratic, open process that a few people have found a way to hijack.”
After a project is approved, any person or group can file a complaint in the D.C. Court of Appeals calling the approval into question. If a group forms a nonprofit entity, filing an appeal can cost next to nothing. In some recent cases, the appeals have been filed by groups that did not participate in the public hearings during the Zoning Commission process. The appeals of Ditto Residential's 301 Florida Ave. NE and Foulger-Pratt’s 301 N St. NE, two adjacent mixed-use projects near Union Market totaling 428 units, were filed by a group called Union Market Neighbors after no opponents spoke out at either Zoning Commission hearing.
The court has historically deferred to the Zoning Commission to interpret the Comprehensive Plan, but planners see a departure from that tradition in recent years. Judge Roy McLeese, nominated to the court in 2012, wrote the 901 Monroe and McMillan opinions. In those opinions, he questioned the Zoning Commission’s interpretation of the Comprehensive Plan and sent it back to the commission to better explain its conclusions. McLeese declined to comment for this story.
“What has happened with these court cases is a fundamental reversal of a decades-old legal precedent that the appropriate body to interpret the Comprehensive Plan is the Zoning Commission,” said McCarthy, who oversaw the Comprehensive Plan’s approval during her time as director of planning. “But for some reason I don’t understand, a particular set of Court of Appeals judges have jettisoned that.”
While the plaintiffs tend to be those directly impacted by a development, the same activists and lawyers have been involved in organizing and representing residents across the city.
One of the most well-known development opponents, Chris Otten, has been involved with appealing McMillan, the 1,400-unit Barry Farm project, and Ditto and Foulger-Pratt’s Union Market projects, among others. Otten told Bisnow that people typically reach out to him when they are concerned about developments because he has somewhat of a public profile, and he helps them understand their options to engage in the process. He believes the increased pressure of activists like himself has led to the 901 Monroe and McMillan decisions, which he calls “victories.”
“The Zoning Commission has been getting away with rubber stamping for so long now they’re surprised the court has seen what is actually happening,” Otten said. “This is the first time the court is entertaining these things because people are finally taking it to court.”
Otten works with attorney Aristotle Theresa, who has represented the clients in at least 10 zoning appeals since 2015. Theresa believes the Zoning Commission has failed to weigh issues such as gentrification, neighborhood character, property taxes and rent increases when considering PUD approvals.
“Since the Commission has been derelict without account by city officials, D.C. residents have had no choice but to seek relief in the courts, especially after having won the landmark McMillan case,” Theresa said in an emailed statement.
Developers do not hold high opinions of these activists. One case in particular — when Otten last year settled with Foxhall Partners for $2M in exchange for dropping an appeal of an Adams Morgan hotel — stands out as evidence to some developers that opponents’ motives are not pure. But ultimately, builders blame the process that allows opponents to hold up development with relative ease.
“Without meaningful reforms, the PUD process in the District of Columbia will continue to be shackled with litigation by opportunistic money-grabbers, reducing thoughtful, community-oriented and community-backed development,” Foxhall Managing Partner Matt Wexler said. “As a result, the supply of both market-rate and affordable housing units in the District will be reduced, hurting all of those who seek to rent or buy."
What This Means For D.C. Housing
Already one of the most expensive U.S. cities for housing, D.C. has sought to increase its supply of market-rate apartments to keep rents down while creating affordable units reserved for those making below the area’s median income.
“The more supply there is, the more affordable it’s going to be,” Douglas Development principal Norman Jemal said. Douglas is planning a 199-unit, Harris Teeter-anchored project along D.C.'s northern border, which currently faces appeal. “By delaying projects, you pinch the supply. The difference between a few thousand more units coming online would impact pricing and make things more affordable.”
In addition to reducing the city’s overall housing stock, the appeals have delayed projects that have major components of affordable housing set aside for low-income residents. The District currently has about 9,000 people seeking affordable housing on its inclusionary zoning registry list, according to the Department of Housing and Community Development.
The redevelopment of the Barry Farm public housing community in Anacostia has been going through the appeals process since September 2015. The proposal calls for 1,354 total units, 344 of which would be replacement public housing units for those making less than 30% of area median income, while another 285 units would be set aside for those making less than 80% AMI. The D.C. Housing Authority, in partnership with A-R Development, is moving forward with relocation and demolition of the existing buildings, but cannot begin construction until the appeal is settled.
Kenilworth Courts, a project that calls for 530 total units, 290 to replace existing public housing and at least 198 more set aside as affordable, was appealed in February after receiving PUD approval in January. The project also cannot break ground until the court makes a decision.
Park Morton, a 273-unit project with at least 109 affordable units, was appealed on June 1. DMPED, which is developing the project with Dantes Partners and Community Builders, said it hopes to have a decision by next spring that allows it to move forward.
While the court has only vacated approvals of McMillan and 901 Monroe, the mere act of being appealed can delay a project significantly and hurt the developers' ability to obtain financing necessary to start construction.
“When you constrain supply, you exacerbate the problem,” Hoffman said. “It actually makes things more expensive for everybody, and it has a chilling effect on the capital coming into projects. The more unpredictable you make something, the higher the risk, and capital obviously doesn’t like risk.”
These concerns have caused developers to shy away from the PUD process and find ways to build within existing zoning, a process called by-right development. This reduces the overall number of units developers can create, and it allows them to bypass the requirements and incentives the PUD process has for setting aside affordable units.
MRP Realty recently scrapped the PUD for its massive development by the Rhode Island Avenue Metro station and instead decided to pursue building by-right. This reduces the number of units it plans to build from 1,631 to no more than 1,450, an MRP spokesperson said. The developer decided to make the change after a group represented by Theresa appealed the project in January.
MRP decided that the time it would take to go through the appeal, coupled with the need to go back to the Zoning Commission for any future changes to the development plan, made the PUD process too much of a burden, Bisnow confirmed. It now expects to break ground in Q2 2018.
After reaching its settlement with Otten over the Adams Morgan hotel, Foxhall decided not to go through the PUD process for a nearby apartment building it is planning, instead choosing to build by-right and construct an 80-unit development. Wexler could not say exactly how many units were lost because of the decision, but he said Foxhall avoided the PUD process because of the likelihood of “frivolous appeal.”
Also in Adams Morgan, PN Hoffman shrunk its plan for its Suntrust Plaza development to build within existing zoning and give opponents less opportunity to appeal.
“Once we were threatened by a vocal minority, and this is not the majority of people in Adams Morgan, who support redevelopment, we wanted to get moving on it at some point, so we had to adjust the design,” Hoffman said.
The resulting design included a smaller public plaza and less density, though Hoffman could also not say how many units were lost. The project did not need zoning approval but it did have to go through the Historic Preservation Review Board, which approved it in October. Two neighborhood groups have since filed suit against the project in D.C. Superior Court, which Hoffman said will delay the project for at least a couple of months and potentially much longer.
An Issue Of Federal Overreach
Developers and planners alike have said the ability of federally appointed judges to overturn a local zoning process represents undue influence from the federal government. Each of the judges on the D.C. Court of Appeals was appointed by the president and confirmed by Senate.
“You have a federally appointed court weighing in on local zoning issues, which could be seen by some as being a real challenge to home rule,” Menkiti said.
Menkiti was not the only critic to evoke home rule, a term often used when Congress steps in to influence D.C.’s laws or budget.
“There is a local rights issue here,” Trueblood said. “If you look at other cities, the planning process doesn’t go to a federal appeals court. Our immediate appeal goes to federal appeals court. I’m not sure they’re meant to understand the nuances of land use, it’s typically not a federal issue. There are some of the issues around home rule involved here.”
How To Improve The Process
The Comprehensive Plan, a more than 600-page document adopted in 2006, sets goals and guidelines for the District’s development. It is currently going through an amendment process that planners hope can clear up some of the issues that the court has seized on in its reversal of the 901 Monroe and McMillan approvals.
The Office of Planning held seven public meetings to discuss the amendment process and accepted amendments for more than two months from any resident or group that wanted to weigh in. It is now sorting through the amendments it received to determine which to include in its report. The mayor will then submit a draft of the amended plan to the city council, which will hold public hearings and can make its own changes before adopting the new plan.
McCarthy has been involved in organizing interested residents to create a list of priorities for the updated Comprehensive Plan. She said some of the language should be changed in the definitions of moderate and medium density for the Future Land Use map, which sets general guidelines for the level of density for each city block and was referred to by Judge McLeese in his 901 Monroe and McMillan opinions. She also said the plan should include greater incentives to produce more than the minimum requirement of affordable housing.
“We suggested the Comprehensive Plan propose there be zoning changes to make it easier to get additional height and density if a developer offers certain amenities, in particular a higher level of affordable housing than is required under inclusionary zoning,” McCarthy said.
Developers are less worried about the minutia of the Comprehensive Plan and more concerned with the overall clarity and certainty of the approval process.
“We have to come up with a process that works,” Menkiti said. “It’s maybe even less important exactly what that process is, but does it have a defined beginning, a clear set of processes and rules, and a defined end?”
Until a new Comprehensive Plan is adopted, or the status quo changes, there is no end in sight for the developers caught in the judicial process and the D.C. residents waiting for some long-promised affordable housing projects to be built.
CORRECTION, JULY 18, 6:10 P.M. EST: A previous version of this story referred to the D.C. Court of Appeals as a federal court. While its judges are federally appointed, it is technically the equivalent of a state supreme court. The story has been updated.