ONARCHITECTURE- Downzone Mall: Developers not 'taken' with new plan

More than a year ago, we asked what our downtown skyline might look like in 2o years [#9 dreams: Invasion of the super towers," June 1, 2006]. A year an half later, city officials are still wrestling with that question.

During a joint Planning Commission/City Council session on December 12, city staff presented a plan that would effectively "downzone" much of the downtown area, reducing by-right density allowances from 87 dwelling units per acre to 43, and reducing height limits from 101 feet to 70 feet, a plan that had many downtown property owners riled. 

Developer Oliver Kuttner called it a "good way to shoot deals in the foot" and advised the city not to "regulate" their concerns about unchecked growth downtown. Though the plan would still allow developers to increase density and height by obtaining a special use permit (up to 200 units per acre and up to 101 feet in height), Kuttner later pointed out that serious investors won't commit to projects based on what a special use permit might allow. 

"People who buy properties are only really concerned about the by-right determinations," he said. "They're not going to develop a property with the hope of getting a special use permit."

And as Kuttner and others at the meeting pointed out, the math simply doesn't compute. "If these zoning regulation were in place when I built the Terraces," he said, "I would have had to build 4,000-square-foot apartments. If you want investors to build, and you want affordable housing downtown, leave the density alone." 

In addition, Kuttner suggested that concerns about nine-story buildings invading the Mall might be overblown. 

"Once you get above 60 feet, it's a whole different kind of construction that's very expensive," he said. "Very few developers are going to be able to do that."

Indeed, the city's proposed downzoning plan is the direct result of worries about the future of the Mall's skyline. 

In the spring of 2006, seeking to take advantage of the 2003 city-wide zoning changes that sought to encourage greater and density, developer Keith Woodard proposed a nine-story mixed-use behemoth for his property at First and East Main streets. Already, the city had seen architect Bill Atwood's plan for a nine-story building on Water Street, and talk of another tower at 201 Avon Street, Coran Capshaw's Coal Tower project, as well as plans for a hotel on the Mall were in the air. 

In May, the BAR gave Woodard a thumbs down on his plan to demolish much of the building at the First and East Main site, but Woodard appealed that decision to City Council in June. Councilors seemed prepared to side with the BAR, but after former councilor Blake Caravati argued on Woodard's behalf, the decision was deferred, and a committee was formed to study the impact of tall buildings downtown.

In January 2007, Jim Tolbert, director of neighborhood development, presented the committee's findings, including a sunlight study that showed how buildings above 70 feet would cast long shadows over the Mall and nearby Lee Park.  

The goals of the committee, according to Tolbert's old report, included preserving the "human scale" of the Mall and saving existing historic buildings while still allowing developers to build bigger buildings.

"Now that we're seeing the reality of development starting to take place on the Downtown Mall," Tolbert wrote, "was that really what we wanted to see? Was that what we intended all along?"

Almost a year later, density restrictions (which were not recommended by the committee studying height issues) have accompanied the sunlight study, along with various changes in setbacks and street height limits, to curtail any unchecked development. Or, as Tolbert put it, the downzoning plan "leaves us a tool to have a discussion" with developers. It's a touchy tool at a minimum. At the December 12 meeting, development-minded South Street property owner Julian Calvet expressed concern.

"Under this plan, our density will be reduced more than other places downtown," said Calvet, "and this will make us lose property value."

Tolbert sent the Planning Commission a memo from the City Attorney warning hinting at legal challenges, or as he put it, the "danger" of downzoning properties.

"In spite of that warning," wrote Tolbert, "it's our recommendation that we move forward with this process, and in this case the greater community good calls for these changes."

Tolbert has declined to release the memo, citing attorney/client privilege. During the Planning Commission meeting, City Councilor Dave Norris asked about the memo and received the same answer from Deputy City Attorney Richard Harris.  

"A number of the speakers said they felt the proposed guidelines constituted either spot zoning and/or a 'taking,' and I was hoping the deputy city attorney could shed some light on that," says Norris. "Obviously, he felt he couldn't."

So called "takings" doctrines are based on the Fifth Amendment guarantee that "private property shall not be taken for public use without just compensation," and takings have been a rallying cry for property rights advocates. However, evolving federal, state, and local laws have been quite complex, seeking to balance property rights with the "greater community good," as Tolbert pointed out.

Local lawyer Jennifer McKeever, who specializes in real estate law, suspects the "dangers" referred to in Tolbert's secret memo could be lawsuits from property owners who think their property rights are being abrogated.

"Downzoning takes away one element of a property owner's rights," she says. "It affects the maximum profitability of that property, and maximizing profit is a right associated with owning property." 

While McKeever isn't familiar with the City's proposed down-zoning plan, she says there's a high standard for the city to meet if a property owner were to challenge the changes in court. "The city would have to prove that there are very real and tangible benefits from the downzoning," she says. 

Although Tolbert said he was not asking for an immediate decision from the Planning Commission, he did encourage members to come back with recommendations in January. "This thing has been out there for a year, and we'd like to see you move on it," he said, "not drag it out forever."

Considering the property rights issues raised by the plan, that might be a bit of wishful thinking.