Case Title: Files v. Arkansas State Highway and Transp. Dep't

Citation: 

Docket Number: 

State: arkansas

Court: Arkansas Supreme Court

Date: 1996-07-08T00:00:00Z

Document:
Kirk FILES v. ARKANSAS STATE HIGHWAY AND
TRANSPORTATION DEPARTMENT

95-952                                             ___ S.W.2d ___

                    Supreme Court of Arkansas
                 Opinion delivered July 8, 1996


1.   Administrative law & procedure -- standard of review. -- The
     standard of review for decisions of administrative agencies is
     well established: the appellate court's review is not directed
     toward the circuit court but toward the decision of the
     agency; the appellate court recognizes that administrative
     agencies are better equipped by specialization, insight
     through experience, and more flexible procedures than courts
     to determine and analyze legal issues affecting their
     agencies; if the appellate court finds that the administrative
     decision is supported by substantial evidence and is not
     arbitrary, capricious, or characterized by an abuse of
     discretion, the court upholds it.

2.   Administrative law & procedure -- administrative construction
     of statute -- when overturned. -- The construction of a
     statute by an administrative agency is not overturned unless
     it is clearly wrong; where, however, the statute is plain and
     unambiguous, the appellate court will interpret the statute to
     mean only what it says.

3.   Statutes -- Arkansas Highway Beautification Act -- purpose. --
     The purpose behind the Arkansas Highway and Beautification
     Act, codified at Ark. Code Ann.  27-74-101 et seq. (Repl.
     1994), which was adopted in compliance with the 1965 Federal
     Highway Beautification Act, 23 U.S.C.  131 et seq., is to
     promote the reasonable, orderly, and effective display of
     outdoor advertising, to promote the safety and recreational
     value of public travel, and to preserve natural beauty.

4.   Statutes -- Arkansas Highway Beautification Act -- broadly
     construed -- Highway Commission vested with regulatory
     authority to enforce act. -- The Arkansas Highway
     Beautification Act is remedial in nature and must be broadly
     construed to effectuate the purpose sought to be accomplished
     by its enactment; under Ark. Code Ann.  27-74-203, 27-74-
     211(b) (Repl. 1994), the General Assembly has vested the
     Arkansas State Highway Commission with regulatory authority to
     enforce the Arkansas Highway Beautification Act.

5.   Administrative law & procedure -- Highway Department
     appropriately examined city's zoning ordinance. -- The supreme
     court held that the Arkansas State Highway and Transportation
     Department appropriately examined the propriety of a city's
     zoning ordinance; some deference must be given to the
     Department's interpretation of state and federal regulations
     in this area; the Department's interpretation of its authority
     enables it to review limited commercial zoning decisions
     relating to outdoor advertising to determine validity; this
     fosters the purposes of the Highway Beautification Act and
     assures compliance with federal law; the General Assembly
     certainly contemplated that the Department would regulate
     outdoor advertising in accordance with state and federal law.

6.   Administrative law & procedure -- agency decision affirmed if
     supported by substantial evidence. -- The appellate court must
     affirm the decision of an administrative agency if there is
     substantial evidence of record to support it; substantial
     evidence is valid, legal, and persuasive evidence and such
     relevant evidence as a reasonable mind might accept as
     adequate to support a conclusion.

7.   Evidence -- substantial evidence supported conclusion that
     commercial zoning designation was given for sole purpose of
     erecting billboards. -- The supreme court held that
     substantial evidence supported the hearing officer's
     conclusion that the city's commercial zoning designation was
     given for the sole purpose of erecting billboards where
     evidence was presented that land with billboards adjacent to
     the proposed site had been zoned commercial but otherwise were
     being used only for agricultural purposes; that one of these
     properties had been zoned commercial ten years prior to the
     zoning of the proposed site and still had no commercial
     development; that appellant was in the billboard business and
     that he had no plans to develop the land at issue; that no
     dedicated access or services by the city were planned for
     appellant's property; and that a Beautification Coordinator
     for the Highway Department was told by a city building
     inspector that appellant wanted the commercial designation so
     that he could place billboards on the property.


     Appeal from Monroe Circuit Court; Olly Neal, Judge; affirmed.
     Eichenbaum, Scott, Miller, Liles & Heister, P.A., by:
Christopher O. Parker, for appellant.
     Robert L. Wilson and Maria L. Schenetzke, for appellee.

     Robert L. Brown, Justice.Associate Justice Robert L. Brown
July 8, 1996   *ADVREP*SC7*






KIRK FILES,
                    APPELLANT,

V.

ARKANSAS STATE HIGHWAY AND
TRANSPORTATION DEPARTMENT,
                     APPELLEE,

95-952




APPEAL FROM THE MONROE COUNTY
CIRCUIT COURT,
NO. CIV 93-87,
HON. OLLY NEAL, JUDGE,




AFFIRMED.






     Appellant Kirk Files appeals the denial by the appellee,
Arkansas State Highway and Transportation Department (Department),
of his application for a billboard permit on land bordering
Interstate Highway 40 in Brinkley.  His arguments on appeal are
two-fold: the Department had no authority to question city zoning
for the property in question, and the Department's hearing officer
erred in finding that the purpose behind the city zoning was to
permit the erection of billboards.  The circuit court affirmed the
hearing officer's decision.  We affirm the circuit court.
     On November 9, 1992, the County Court of Monroe County ordered
the annexation of 58.51 acres of land owned by the Duke family into
the City of Brinkley.  On December 15, 1992, the City of Brinkley
approved the annexation and designated the property as C-2, which
was Highway Commercial under the city ordinances.  On March 1,
1993, Kirk Files, Inc., purchased the land from the Duke family. 
Kirk Files already owned several billboards on land along I-40 but
within the city limits of Brinkley, and on March 11, 1993, he
applied to the Highway Department for a permit to place a billboard
on the purchased property.
     On May 4, 1993, the Department denied Files's application for
a billboard permit.  The stated reasons for the denial were the
sign site was not located on zoned or unzoned commercial or
industrial land as defined by Highway Commission regulations, and,
secondly, the land was annexed and zoned commercial by the City of
Brinkley primarily for the purpose of erecting billboards, which
contravened the policy expressed in the Federal and State Highway
Beautification laws.
     Files contested the Department's denial and requested a
hearing.  A hearing was held before a designated hearing officer,
and Files testified that at the time he purchased the land at
issue, it lay within the city limits of Brinkley and was zoned C-2,
which under the City Ordinance is a Highway Commercial District. 
Files implicitly admitted that at the time of purchase the property
was not commercially developed, and he stated that he had no
present plans to develop the property. Files further testified that
he owned other land along I-40 within the city limits of Brinkley
and that he had placed billboards on those properties.  He stated
that none of those tracts had been commercially developed except
for one which contained a retirement facility.  He testified that
he never approached any city official in Brinkley about the
annexation and rezoning of the Duke land prior to his purchase.
     Larry Long, section head of the Department's Environmental
Division - Beautification Section, testified that, although the
City of Brinkley had zoned the Duke land C-2, he did not consider
that zoning to be valid commercial zoning for purposes of the
outdoor advertising regulations because the land had been zoned
solely to allow billboards.  Long further stated that federal
regulations gave the Department the authority to look to the intent
of the zoning to determine if the zoning was valid under the State
and Federal Highway Beautification laws.
     At a second hearing, Files again testified and stated that one
of the pieces of land where he already maintained a billboard was
used for agricultural purposes and was rented on a sharecropping
basis.  At the time the City annexed that land, he said that a
manufacturing plant was to be built on the property.  The company,
though, went bankrupt.  Files added that there was no commercial
activity on the proposed site for the billboard, nor on any of the
property he owned north of I-40 which had billboards.  He stated
that the proposed site is served by a dirt farm road.  All
improvements on the land are for agricultural purposes, and there
are no utilities provided, except there is access to electricity
and telephone services.  Files finally stated that he never
informed the Dukes that he would purchase the property if it was
zoned commercial and that he had nothing to do with the property's
annexation and rezoning.  As to the land east of his property,
Files testified that it was owned by a neighbor, who is also in the
billboard business.  That land is zoned C-2, and since 1983, it has
never been commercially developed.
     Jeff Ingram, a Beautification Coordinator for the Department,
testified that the denial decision was based on the fact that there
had been no commercial development in the annexed area.  He also
stated that the land adjoining the proposed site was agricultural
and the only non-agricultural activity on that land was the
placement of billboards.  He admitted that the spread of billboards
on farm land along I-40 raised a "red flag" that there was a
problem with the zoning.  The fact that the city had annexed
another tract of land and zoned it commercial when the previous
annexations had had no subsequent commercial development created a
pattern in his opinion.  Ingram further testified that he spoke
with Brinkley's building inspector, Wayne Young, who informed him
that property annexed into the city was normally annexed as
residential property and that it was unusual for the Duke/Files
property to be annexed and then commercially zoned.  According to
Ingram, Young told him that the land was zoned commercial because
Files had stated that he wanted to place billboards there.
     Larry Long retook the stand and agreed with Ingram's
assessment of the billboard proliferation.  He also admitted that
the Department had not certified Brinkley for comprehensive zoning
which would have ended the Department's regulation of signs in the
area but would still have permitted the Department to question
commercial zoning purely for outdoor advertising.
     The hearing officer upheld the Department's denial.  In doing
so, he found that there was no industrial or commercial development
on several tracts of land adjacent to I-40 and inside the city
limits of Brinkley, including the Files property.  He further found
that the evidence showed that the City of Brinkley did not want the
responsibility of providing dedicated access or utilities to the
Files property to encourage its development, and that Files had no
plans to construct access or provide utilities on the land or to
develop it in any way, either commercially or industrially.  The
hearing officer concluded by making these principal points:
          1.   The AHTD Environmental Division's
     Beautification Section acted within its authority to
     investigate the circumstances surrounding the City of
     Brinkley's zoning of Mr. Kirk File's property for
     purposes of the Highway Beautification program.  
          2.   The AHTD Beautification Section  had sufficient
     information and precedent to conclude that the current
     zoning of this property was for the erection of outdoor
     advertising and acted properly within their authority
     under the Highway Beautification Act in denying the
     application/permit.
          3.   It is necessary, when considering an outdoor
     advertising application/permit for approval, for the
     Department to review the specifics of the contents of the
     application and the circumstances behind it to determine
     if it complies with Federal and state law with respect to
     the placement of outdoor advertising in zoned or unzoned
     commercial or industrial areas pursuant to the
     Regulations, and thereby satisfies the purposes and
     intent of the Highway Beautification Act.
          4.   This property has not been zoned commercial for
     the purposes of the Highway Beautification program until
     the zoning procedures outlined in the Cities' zoning
     ordinances have been satisfied and a final determination
     of the properties' correct zoning under the Cities'
     comprehensive zoning plan has been completed.
Files filed a petition for judicial review of the hearing officer's
decision, and the circuit court affirmed that decision.
     Files now argues on appeal that the hearing officer erred as
a matter of law in finding that the Department could look behind
Brinkley's zoning designation and examine the motivation behind
that zoning for purposes of the Arkansas Highway Beautification
Act.  The standard of review for decisions of administrative
agencies is well-established:
     Our review is not directed toward the circuit court but
     toward the decision of the agency recognizing that
     administrative agencies are better equipped by
     specialization, insight through experience, and more
     flexible procedures than courts, to determine and analyze
     legal issues affecting their agencies.  If we find the
     administrative decision is supported by substantial
     evidence and is not arbitrary, capricious or
     characterized by an abuse of discretion, we uphold it.
Arkansas Dep't of Human Servs. v. Wilson, 323 Ark. 151, 155, 913 S.W.2d 783, 785 (1996),  quoting Franklin v. Arkansas Dep't of
Human Servs., 319 Ark. 468, 472,