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. e du/thir dc ir c uit_1999/305Filed November 19, 1999

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

No. 98-6484

CELLULAR TELEPHONE COMPANY, d/b/a AT&T Wireless Services, f/k/a Cellular One;

NEW YORK SMSA LIMITED PARTNERSHIP AND ITS GENERAL PARTNER CELLCO PARTNERSHIP, d/b/a Bell Atlantic Nynex Mobile;

SMART SMR OF NEW YORK, INC., d/b/a Nextel Communications

v.

ZONING BOARD OF ADJUSTMENT OF THE

BOROUGH OF HO-HO-KUS

New York SMSA Limited Partnership and its General Partner Cellco Partnership, d/b/a Bell Atlantic Nynex Mobile,

Appellant

APPEAL FROM THE

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF NEW JERSEY

(D.C. No. 97-cv-03408) District Judge: The Honorable Maryanne Trump Barry

ARGUED JUNE 18, 1999

BEFORE: NYGAARD, STAPLETON, and COWEN, Circuit Judges.

(Filed November 19, 1999)Thomas F. Campion, Esq.

Kenneth J. Wilbur, Esq. Drinker, Biddle & Shanley 500 Campus Drive Florham Park, NJ 07932-1047

Alison B. Brotman, Esq. (Argued)

Bell Atlantic NYNEX Mobile 180 Washington Valley Road Bedminster, NJ 07921

Attorneys for Appellant

David L. Rutherford, Esq. (Argued) 141 Dayton Street

PO Box 5108 Ridgewood, NJ 07451

Attorney for Appellee

OPINION OF THE COURT

NYGAARD, Circuit Judge.

This appeal originates from a decision by the Zonin g Board of Adjustment of the Borough of Ho-Ho-Kus, Ne w Jersey denying an application by three cellular communication providers for variances necessary to build a wireless communications facility within the Borough . The providers claim that the Borough's decision violate s section

704 of the Telecommunications Act of 1996 because: 1) the Zoning Board unlawfully considered the quality of e xisting wireless service during the decision process; 2) it s decision is not supported by substantial evidence; and 3) th e decision has the effect of prohibiting personal wir eless services. The providers also claim that the Zoning Board's decision violates New Jersey state zoning law. The District Court granted summary judgment in favor of the Zoni ng Board on all issues. We will affirm in part and rev erse in
part.

I. Factual Background

The parties have stipulated to the following facts, taken largely from the District Court's opinion. See Cell ular Tel.

2Co. v. Zoning Board, 24 F. Supp. 2d 359 (D. N.J. 19 98).

Two of the providers, Cellular Telephone Company, d /b/a AT&T Wireless Services, and Cellco Partnership, d/b /a Bell Atlantic Nynex Mobile, are licensed by the Federal Communications Commission to provide wireless cellu lar telephone service to the Borough of Ho-Ho-Kus, New Jersey. SMART SMR of New York, Inc., d/b/a Nextel Communications, is licensed to provide wireless mob ile radio services. On August 2, 1994, AT&T and the Bor ough entered into a lease for 2,350 square feet of Borou gh-owned property on which AT&T planned to construct a wirel ess telecommunications facility. The facility, as conte mplated by the lease, would include a wireless communicatio ns monopole, associated antennae, and related equipmen t shelters, all of which would be surrounded by a sec urity fence. Thereafter, Bell Atlantic and Nextel entered into colocation agreements with the Borough, authorized by the AT&T lease, allowing Bell Atlantic and Nextel to in stall their own antennae on the proposed monopole, and to utili ze a portion of the accompanying equipment shelters. AT& T,

Bell Atlantic and Nextel are referred to collective ly throughout this opinion as the "providers."

The AT&T lease was contingent upon the company acquiring all required zoning variances, special us e permits and building permits. Although the proposed site is located in an R-2 residential zone, it is actually part of two larger lots (Lots 3 and 4 in Block 603 of the Borough of H o-HoKus), which contain, among other things, the Depart ment of Public Works' salt storage barn and accompanying fencing, a motor vehicle fueling area, a public rec ycling center, and open storage for municipal equipment. T he lots do not contain any residences. Two sides of the lea sed site border public roads, while a third abuts the New Je rsey Transit railroad line.

On September 3, 1994, the providers applied to the Borough's zoning official for variances necessary t o construct three buildings, a 125-foot monopole with antennae reaching as high as 127 feet, and a six-fo ot high barbed wire fence. The proposed monopole would be a cylindrical galvanized steel structure measuring th ree feet in diameter at its base and eighteen inches at its top. The

3monopole would support twenty seven antennae, nine for

each of the providers, in a 360o array. Maintenance personnel would visit the site approximately once a month, but it would be otherwise unmanned. The zoning offi cial denied the application. The providers then amended their application, reducing the number of equipment shelt ers from three to two, changing the layout of all plann ed improvements on the site, and lowering the security fence from six to five feet. The zoning official denied t he amended application as well.

The providers next brought both their original and amended applications before the Zoning Board of Adjustment, seeking thirteen variances from the Bor ough's zoning ordinance. On April 24, 1997, after two and a half years and forty-four public hearings, the Board vot ed to deny the applications. The Board then memorialized its decision in a thirty-six page resolution adopted on June 5, 1997 (the "Resolution"). The Resolution concluded a s follows:

[T]he public interest which will be served b y the proposed monopole is not substantial, as the quality of cellular telephone service already being pro vided within the Borough of Ho-Ho-Kus is adequate . . . . The Board [also] finds that the site is inappropriate for that use, given its already congested nature, and [the fact that] numerous bulk variances are required, includ ing one related to the required setback of the struc ture from the property lines. The Board also finds tha t the construction of the monopole will have a sub stantially detrimental impact upon the public good and the purpose and intent of the zone plan and ordi nance based upon a significant detrimental visual impact, the

construction of such a massive structure on a relatively tiny piece of property, and a sig nificant decline in real property values. The Board f inds that

. . . the balance must be struck in favor of denying the application. The public good being served is not compelling. Due to the nature of the structu re, no conditions can be imposed that would reduce the impact, and on balance the negative consider ations outweigh the benefits to be obtained.

4Resolution: Zoning Board of Adjustment, Borough of HoHo-Kus, June 5, 1997 at 35-36, reprinted in Brief f or Appellant app. at A177-78. 833<!>On judicial review, the district court grant ed the

Borough's motion for summary judgment, finding that the Board's denial did not have the effect of prohibiti ng personal wireless services, was supported by substa ntial evidence, and was based on a proper application of state zoning laws. The providers appealed. We exercise pl enary review over the District Court's grant of summary judgment. See Doby v. DeCrescenzo, 171 F.3d 858, 86 7 (3d Cir. 1999).

II. Discussion

The providers first claim that the Board's decision has the effect of prohibiting personal wireless service s in Ho-HoKus, and thus violates S 704 of the Telecommunicati ons Act of 1996, codified at 47 U.S.C. S 332(c)(7). As part of this claim, the providers argue that the Board had no au thority to consider the quality of existing personal wirele ss service when ruling on their applications. In the alternati ve, they argue that the Ho-Ho-Kus zoning ordinance, though f acially neutral, effectively prohibits personal wireless se rvices in violation of the Telecommunications Act. The provid ers also

claim that the Board's denial violates the Telecommunications Act because it is not supported by substantial evidence. Finally, the providers claim that the

Board's denial is invalid because it relies on a misapplication of applicable state zoning laws.

A. Local Zoning Authority

The Telecommunications Act expressly preserves loca l zoning authority over the placement, construction a nd modification of personal wireless service facilitie s. See 47 U.S.C. S 332(c)(7)(A). Nevertheless, the statute su bjects the exercise of local zoning authority1 to six limitati ons. First,

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1. The statute actually preserves the zoning author ity of the states,

local governments and instrumentalities thereof. We refer exclusively to "local" zoning authority for simplicity's sake only.

5local regulation may not unreasonably discriminate among

providers of functionally equivalent wireless servi ces. See id. S 332(c)(7)(B)(i)(I). Second, local regulation may not prohibit or have the effect of prohibiting the prov ision of personal wireless services. See id. S 332(c)(7)(B)( i)(II). Third, local regulators must act on placement, constructio n and modification applications within a reasonable perio d of time. See id. S 332(c)(7)(B)(ii). Fourth, all decis ions denying a request to place, construct or modify a personal wireless services facility must be in writing and supported by

substantial evidence contained in a written record. See id. S 332(c)(7)(B)(iii). Fifth, any person adversely af fected by local regulators' final action on a placement, cons truction, or modification application may seek judicial revie w in any court of competent jurisdiction. See id. S 332(c)(7 )(B)(v). Finally, the statute substantially limits the autho rity of local officials to regulate personal wireless facil ities on the basis of the environmental effects of radio frequen cy emissions. See id. S 332(c)(7)(B)(iv).

In the course of its long deliberations over the applications at issue, the Board received testimony and other evidence from both the providers and their op ponents concerning the quality of existing personal wireles s services in Ho-Ho-Kus. A radio frequency engineer for AT&T t estified that there were various areas within the Borough wh ere the quality of service was very poor, and other areas w here the odds of actually being able to place or receive a c all were so low as to render them essentially "no service" area s. See Transcript: March 9, 1995 Ho-Ho-Kus Board of Adjust ment Hearing at 124-26, reprinted in Appellant's Brief a pp. at A438-40. Similarly, a radio frequency engineer for Bell Atlantic testified that his company's cellular serv ice in the area was marginal at best, and generally unreliable . See Transcript: April 13, 1995 Ho-Ho-Kus Board of Adjus tment Hearing at 109-11, reprinted in Appellant's Brief a pp. at A741-43. A Nextel engineer described his company's mobile radio service in the Borough as "almost non-existen t." See id. at 169, reprinted in Appellant's Brief app. at A801.

In response, two Ho-Ho-Kus residents presented tape recordings they had made of twelve cellular telepho ne calls placed from various locations within the Borough. T he

6recordings apparently demonstrated relatively good

connection and transmission quality with respect to the twelve calls recorded, and the Board accepted them as competent evidence that existing wireless service a s a whole was adequate. See Resolution: Zoning Board of Adjus tment, Borough of Ho-Ho-Kus, June 5, 1997 at 13, reprinted in Appellant's Brief app. at A153; see also, Transcrip t: May 23, 1996 Ho-Ho-Kus Board of Adjustment Hearing at 5 9- 89, reprinted in Appellant's Brief app. at A1907-37

.

The providers challenged the evidentiary value of t he tape recordings and pointed out that while the residents placed twelve calls, AT&T's tests included calls from appr oximately 2,500 locations within the borough. Because AT&T conducted five such tests, the total data apparentl y included at least 12,500 calls. Underscoring furthe r this dramatic difference in the sample size, the provide rs point out that of the residents' twelve calls, only two c alls were placed from the worst service areas. The residents also made the calls in April when few trees had foliage, a significant source of interference; they called whi le stationary, again avoiding sources of interference; and all of their calls were made on a Saturday when demand was low, yet another variable affecting call performance. Fi nally, the residents only recorded the uplink, which is picked up by the more sensitive receiver at a cellular facility and transmitted to a land-line phone. They did not reco rd the more problematic downlink that a cellular phone rec eives from its much less sensitive antenna. Evidence prod uced from the providers' own test calls indicated that m ost suffered from some form of technical difficulty.

After weighing the conflicting evidence, the Board concluded that the quality of existing cellular ser vice within the Borough and surrounding area was sufficient, an d that there was therefore no legitimate need for the prop osed monopole. See Resolution of the Zoning Board of Adjustment, Borough of Ho-Ho-Kus, June 27, 1997 at 25, reprinted in Appellant's Brief app. at A165. The pr oviders argue, however, that local authorities are barred f rom considering quality of service issues when determin ing whether and where to permit wireless communication facilities within their jurisdictions. They contend that the

7comprehensive body of federal law regulating the

telecommunications industry effectively, if not exp ressly, preempts local authorities from regulating the qual ity of personal wireless services. They further contend th at because judging the quality of wireless services do es not concern the physical location and construction of c ellular facilities, it is not a legitimate exercise of zoni ng power, but rather an unlawful intrusion upon the Federal Communications Commission's exclusive regulatory authority.

As an initial matter, we reject the proposition tha t local zoning authorities are wholly barred from consideri ng the quality of existing personal wireless service. Obvi ously, local officials must, at a minimum, consider whether wire less service currently exists within their jurisdictions if they are to determine whether rejecting a proposed wireless communications facility would have the effect of pr ohibiting such service. The providers contend, however, that allowing local officials to go beyond this threshold conside ration, and to reject wireless communication facilities bas ed on their own evaluation of existing service, would und ermine the Telecommunications Act's twin goals of encourag ing rapid deployment of new technologies and providing nationwide seamless cellular service to the public.

Contrary to the providers' arguments, we conclude t hat barring all local quality-of-service considerations could just as easily undermine the Telecommunications Act's go als as further them. Decisions to grant or deny variances from local zoning ordinances generally require local off icials to balance the interests that will be affected by the decision. Indeed, New Jersey law specifically mandates such a balancing approach. Obviously, one of the interests affected by a decision to grant or deny a variance necessary to construct a wireless communications facility is the quality of existing wireless services. A finding that exist ing service is relatively poor could tip the scale in favor of granting a variance that, absent consideration of current qual ity, might otherwise be denied.

In so holding, we do not suggest that the discretio n of

local officials is unlimited. The Telecommunication s Act imposes a number of explicit restrictions on the ex ercise of

8local zoning authority. For instance, determination s

concerning the quality of existing service must be based on substantial, competent evidence and remain subject to judicial review. Additionally, although the

Telecommunications Act does not divest local offici als of any authority they may have to consider the quality of existing wireless services, neither does it create such authority. Efforts to assess existing quality, and to weigh the benefits of enhancing it against the possible c osts, must be authorized by and performed within the parameter s of governing state and local law.

Finally, as the Telecommunications Act itself dicta tes, local officials must always ensure that neither the ir general policies nor their individual decisions prohibit or have the effect of prohibiting personal wireless services. W e interpret this mandate to mean more than simply ensuring that personal wireless services are available somewhere within the relevant jurisdiction, even if they are not ava ilable throughout. Thus, we conclude, as did the court in Sprint Spectrum, L.P. v. Willoth, 176 F.3d 630, 643 (2d Ci r. 1999), that local zoning policies and decisions have the e ffect of prohibiting wireless communication services if they result in "significant gaps" in the availability of wirele ss services. Building on the Willoth court's analysis, we conclu de that there is a "gap" in personal wireless services when a remote

user of those services is unable either to connect with the land-based national telephone network, or to mainta in a connection capable of supporting a reasonably uninterrupted communication. See id. at 641-43. We do not attempt here to define what constitutes a "signific ant" gap in local wireless services.2 Rather, we will leave it for the

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2. There may be any number of factors that a review ing court may find it necessary to consider when determining whether a significant gap exists, and we make no attempt to enumerate them he re. We think it matters a great deal, however, whether the "gap" in service merely covers

a small residential cul-de-sac or whether it stradd les a significant commuter highway or commuter railway. Unlike a util ity such as electrical power, cellular service is used in trans it, so a gap that

covers a well-traveled road could affect large numbers of travelers--and the people who are trying to communicate with them. Ove r the course of a year, the total disruption caused could be quite si gnificant. Here the

9district court to determine, if necessary, whether there is a

significant gap in service and, if so, whether ther e are any less intrusive means for closing that gap.

B. The Effect of the Ho-Ho-Kus Zoning Ordinance

As previously noted, construction of the proposed wireless communications facility at the center of t his case would require thirteen variances from the Zoning Or dinance of the Borough of Ho-Ho-Kus. The Ordinance, for exa mple, limits the height of radio and television antennae to 50 feet, while the proposed monopole and antennae would be 1 27 feet high. The Ordinance also includes a "fall down zone" provision that requires the distance between the mo nopole and all adjacent property lines to be at least as f ar as the monopole is high. The proposed monopole, however, w ould stand just 4.25 feet from one adjoining property li ne and

26.42 feet from another.

The providers argue that because wireless

communication antennae must be located above the tr ee line, a 50-foot height restriction in a locality su ch as HoHo-Kus, where the prevailing tree line is 70 feet, amounts

to an effective ban on wireless facilities. Similar ly, they argue that because the fall-down provision limits t heir proposed facility to sites containing a minimum of 1-1/2 acres in a town where there is virtually no o pen space, it too has a prohibitory effect. These argum ents fail to address the central issue, however. The Telecommunications Act bars local regulation that p rohibits or has the effect of prohibiting personal wireless services, not the facilities that provide those services. Und er the right conditions, it may be possible to provide an adequa te level of personal wireless services to a particular commu nity solely through facilities located outside that comm unity. We

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proposed tower will be installed next to a railway and several roads that the cellular companies described as significant com muter routes. According to the cellular companies' data, signal s trength on Route 17, as it passed through Ho-Ho-Kus, fell well below wha t the companies say is acceptable service. We suggest the district cour t consider such factors in determining what constitutes a significant gap i n service.

10are not prepared to hold that every community must permit

wireless communication facilities somewhere within its borders regardless of the need for such facilities, nor do the facts of this case require us to decide the issue n ow.

The issue here is whether the Board's rejection of the proposed wireless communication facilities has the effect of prohibiting personal wireless services. The provide rs acknowledge that some level of personal wireless se rvice currently exists in Ho-Ho-Kus, although the level o f service provided by each ranges from spotty to unreliable t o nonexistent. For its part, the Board has assessed the quality of existing service and determined that the improvemen ts offered by the proposed facility are outweighed by its negative impact on the community. In assessing over all quality, however, the Board never specifically dete rmined whether there are significant gaps in the current s ervice. Consequently, we will reverse the district court's summary judgment on the issue of prohibitory effect.

While we have held that local officials are not bar red from considering the quality of existing wireless servic e and, in the first instance at least, whether there are any significant gaps in that service, we note that their findings o n this

issue are not reviewed under the substantial eviden ce standard. That standard applies only to decisions d enying requests for authorization to place, construct or m odify personal wireless facilities. In contrast, the stat utory bar against regulatory prohibition is absolute, and doe s not anticipate any deference to local findings. See 47 U.S.C.A. S 332(c)(7)(B)(i)(II). Because we believe the commu nication providers have presented evidence that there may be significant gaps that only the proposed facility ca n close, we will reverse summary judgment on the issue of prohi bitory

effect.

C. The Substantial Evidence Challenge

The Telecommunications Act requires that any decisi on denying a request to place, construct, or modify pe rsonal wireless service facilities be in writing and suppo rted by

substantial evidence contained in a written record. See 47 U.S.C. S 332(c)(7)(B)(iii). Substantial evidence "d oes not

11mean a large or considerable amount of evidence,`bu t

rather such evidence as a reasonable mind might acc ept as adequate to support a conclusion.' " Pierce v. Unde rwood, 487 U.S. 552, 565, 108 S. Ct. 2541, 2550 (1988) (qu oting Consolidated Edison Co. v. NLRB, 305 U.S. 197, 229, 59 S. Ct. 206, 217 (1938)); see also Omnipoint Corp. v. Z oning Hearing Bd, 181 F.3d 403, 408 (3d Cir. 1999). A rev iewing

court's task is to determine whether there is subst antial evidence in the record as a whole to support the ch allenged decision. See Universal Camera Corp. v. NLRB, 340 U .S. 474, 491, 71 S. Ct. 56 (1951). It has no power eith er to weigh the evidence contained in that record or to s ubstitute

its own conclusions for those of the fact-finder. S ee Williams, 970 F.2d at 1182. Nevertheless, if the re cord as a whole contains conflicting evidence, the fact-finde r must adequately explain its reasons for rejecting or dis crediting competent evidence. See Benton v. Bowen, 820 F.2d 8 5, 88 (3d Cir. 1987).

In the context of S 332(c)(7)(B)(iii), the decision process itself is governed by applicable state and local zo ning laws. The reviewing court's task is to determine whether the decision, as guided by local law, is supported by substantial evidence. See Omnipoint Corp., 181 F.3d at 408. Under New Jersey law, local zoning officials must w eigh the positive and negative factors associated with a req uested zoning variance and determine whether, on balance, those factors weigh in favor of granting or rejecting the request. Thus, the reviewing court's task is to determine wh ether the findings of local officials concerning the posi tive and negative factors, and their relative weight, is sup ported by

substantial evidence.

The providers do not claim that the record, as a wh ole, lacks substantial evidence to support the Board's d ecision. Rather, they challenge two of the Board's specificf indings as being unsupported by substantial evidence. First , they challenge the Board's finding that existing persona l wireless service is adequate, arguing that it is based on in competent evidence. Second, the providers challenge the Board 's finding that the proposed monopole would have a substantial detrimental impact on the value of surr ounding properties. Again, they argue that the Board's detr imental impact finding relies on incompetent evidence.

12During the public hearings held to consider the pro posed

wireless communications facility, the Board heard f rom three experts who testified about the proposed mono pole's economic impact on surrounding properties. The prov iders presented two experts who testified that the monopo le would have no detrimental economic impact, while th eir opponents presented one expert who testified to the contrary. The providers' experts relied, at least i n part, on their conclusions that the very visible presence of telecommunications towers in other New Jersey

communities had had no discernable effect on the va lue of nearby upscale homes. These experts reasoned that i f the visibility of communications towers had no effect o n the "high-end" homes they had studied, it would not adv ersely effect the value of the more moderately priced home s found in Ho-Ho-Kus. The opponent's expert disagreed. Rely ing on a "paired-sales" analysis (i.e., comparing the sale price of a

home from which a communications tower was visible to the sale price of a similar home from which no towe r was visible) he presented evidence tending to show that the proposed monopole would, in fact, adversely impact the

value of some Ho-Ho-Kus homes.

After hearing all the evidence, the Board chose to give greater credence to the opponents' expert than to t he providers' experts. The Board explained that it fav ored the opponents' expert in part because the communities s tudied by the providers' experts were not sufficiently sim ilar to HoHo-Kus, and in part because the opponents' expert's paired-sales methodology was superior to the logica l extrapolation on which the other experts had relied

.

On appeal, the providers challenge the scientific v alidity of the opposing expert's study. They argue that it included too few samples and too many subjective adjustments for factors other than the visibility of nearby communi cation towers that may have explained differences in sales price. They also note that the paired sales considered by the opponents' expert occurred in one of the very same towns the providers' expert had studied. When evaluating the providers' evidence, the Board concluded that

dissimilarities between the studied town and Ho-Ho- Kus rendered the evidence unreliable. Yet, in concludin g that

13the opposing evidence was more reliable, the Board did not

address the issue of community dissimilarities at a ll. The providers argue that the Board cannot have it both ways, and that if the claimed dissimilarities render thei r evidence unreliable, they must render the opposing evidence

unreliable as well.

While acknowledging the theoretical possibility tha t

dissimilarities between two towns could render a comparative study based on one methodology less rel iable than a study based on another, wholly different methodology, we are not certain how that would be t rue in this case. In any event, the Board did not discount the providers' evidence solely on the basis of dissimil arities between the relevant towns, but also because it fou nd that the opposing evidence was based on a more reliable methodology. The only issue is whether it was reaso nable

for the Board to do so. We conclude that it was. Mo reover, our decision does not turn on any single factor tha t the Board may have found weighed against approving the proposed facility. The Board considered a number of other factors, including the proposed facility's purely a esthetic impact on surrounding properties and the adverse ef fects approval would have on the purpose and intent of th e Borough's zone plan and ordinance. The district cou rt ruled, and we agree, that the Board's findings with respect to these other negative factors were supported by

substantial evidence.

The providers also claim that there is no substanti al evidence to support the Board's finding that existi ng personal wireless service in the Borough is adequat e. As discussed in part II-A of this opinion, supra, the providers presented the testimony of three separate experts concerning the various inadequacies of their respec tive services. Two local residents opposed to the propos ed facility presented tape recordings of twelve cellul ar telephone calls they made from various locations wi thin the Borough. The opponents claimed, and the Board agree d, that the tape recordings demonstrated a level of ex isting service "sufficient to properly serve the public go od." See Resolution at 25, reprinted in Appellant's Brief ap p. at A165. In reaching that conclusion, the Board also r elied on

14the providers' admission that there were no "no-ser vice"

areas3 within the Borough, and only three areas whe re the chances of getting a "no-service light"4 were very high.

The district court found, as do we, that the tape recordings made by non-expert local opponents of th e proposed facility were too insubstantial to discred it the expert testimony presented by the providers. Nevert heless, the district court upheld the Board's decision,find ing that the "plaintiffs' own expert witnesses testified--at best -- only that there were some gaps in service within th e Borough, not that service is unavailable." Cellular Telephone Company v. Zoning Bd. Of Adjustment, 24 F

. Supp. 2d 359, 372 (E.D. Pa. 1998). Holding as we do that

the district court must determine whether those ser vice gaps are significant, we cannot agree that the expe rt testimony in this record supports a finding that ex isting wireless service within the Borough is adequate.

Moreover, our own review of the record indicates th at the

Board either misunderstood or mischaracterized the expert testimony on the issue of existing service. During the public hearings, the providers' experts rated the quality of existing wireless services in the Borough using an industry standard scale ranging from one to five. They testi fied that a five represents land-line quality service, meanin g participants in a cellular telephone call will not hear any background static. At level four, there may be some static, but the conversation is basically unimpeded. At lev el three, static is constant and can impede conversation to t he point of making individual words unintelligible. At level two, whole sentences are lost and intelligible conversat ion requires constant repetition and clarification. At level one, service is essentially non-existent because even th ough a connection may be made, any conversation would be unintelligible. See Transcript: April 13, 1996 Ho-H o-Kus

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3. A "no-service" area is an area in which it is no t possible to establish a cellular connection at any time, under any circum stances.

4. In contrast to a "no-service" area, a "no-servic e light" on a cellular telephone simply informs the user that she cannot e stablish a connection at that particular time, under the then existing calling

conditions.

15Board of Adjustment Hearing at 114-115, reprinted i n

Appellant's Brief app. at A750-51.

Though the voluminous record produced during the Borough's 44 public hearings is somewhat difficult to parse, the providers' experts appear to have rated existing

wireless service in Ho-Ho-Kus at level three for in stalled mobile phones (i.e., car phones), and somewhere bet ween levels one and two for hand-held portable phones. S ee id. at 116, reprinted in Appellant's Brief app. at A749 . Thus, it may be factually correct that there are no "no-serv ice" areas and only three areas in which cellular service user s face a high likelihood of getting a "no-service" light. Bu t there is also substantial, unrefuted evidence in the record that even

if a cellular caller is able to make a connection f rom certain locations, any subsequent attempt at conversation w ill be difficult at best, and virtually impossible for use rs of the hand-held portable phones that dominate the market today. Thus, based on this record, we conclude that there is no substantial evidence to support the Board's conclus ion that the current level of personal wireless service in H o-Ho-Kus is adequate.

While the Board considered several factors that wei ghed against approval, the only factor it considered wit h the potential to weigh in favor of approving the propos ed facility was the adequacy of existing service. In other word s, absent a finding that existing service was inadequate, or that the public would benefit by enhancing that service, any negative factor, no matter how slight, would have t ipped the balance in favor of rejection. Because the Board'sf inding that existing service is adequate is not supported by substantial evidence, we will reverse the district court's summary judgment on this issue.

D. State Zoning Law

In New Jersey, the power of zoning boards of adjust ment to grant variances is prescribed by state statute. See N.J. STAT. ANN. S 40:55D-70 (West Supp. 1999). Under tha t statute, a board's power to grant certain variances

, including a conditional-use variance, from the loca l zoning ordinance is subject to certain limitations. Two ar e relevant

16here. First, there must be "special reasons" for gr anting the

variance. Id. S 40:55D-70(d). Second, the local boa rd may not grant a variance without a showing that it "can be granted without substantial detriment to the public good and will not substantially impair the intent and th e purpose of the zone plan and zoning ordinance." Id. New Jersey's courts refer to these limitations as creat ing "positive" and "negative" criteria that must be sat isfied before a variance can be granted. See Sica v. Board of Adjustment, 127 N.J. 152, 156, 603 A.2d 30, 32 (N.J . Sup. Ct. 1992). If the proposed use is deemed "inherentl y beneficial," the positive criteria requirement is automatically satisfied. Nevertheless, once the pos itive and negative criteria are established, they must still be balanced against one another. See id. at 164, 603 A .2d at

36-37.

The New Jersey Supreme Court has provided local boa rds with a four step procedure for balancing positive a nd negative criteria. First, the board should identify the public interest at stake and determine, in the general sch eme of public importance, whether or not it is compelling. Second, the board should identify the detrimental effects o f granting the variance and determine whether they are only mi nimal or more severe. Third, the board should reduce any detrimental effects, if possible, by imposing reaso nable conditions on the proposed use. Finally, the board should weigh the positive against the negative criteria an d determine whether, on balance, granting the varianc e would be a substantial detriment to the public good . See id. at 165-66, 603 A.2d at 37.

The providers raise several challenges to the Board 's balancing of the positive and negative criteria in this case. First, they claim that in evaluating the positive c riteria, the Board erroneously focused on the proposed facility' s deviations from the relevant conditions imposed by the zoning ordinance. In their view, the positive crite ria issue turns on the particular benefits of placing the fac ility at the proposed site, not on the extent to which it deviat es from applicable zoning conditions. We disagree.

In Coventry Square, Inc. v. Westwood Zoning Bd. of Adjustment, 138 N.J. 285, 650 A.2d 340 (1994), the New

17Jersey Supreme Court held that the standard for

establishing the "positive" criteria required under New Jersey zoning law depends on the type of variance a t issue. Where, as here, a variance is necessary to permit a nonconforming conditional use, the applicant need only prove that the site continues to be suitable for the prop osed use despite its failure to comply with one or more cond itions. See id. at 298-99, 650 A.2d at 346-47. The Coventry court explained that:

[the conditional-use] standard of proof will focus both the applicant's and the board's attention on the specific deviation from conditions imposed by the ord inance, and will permit the board to find special re asons to support the variance only if it is persuaded that the non-compliance with conditions does not affe ct the suitability of the site for the conditional use.

Id. at 298-99, 650 A.2d at 346-47. Thus, satisfying the positive criteria for a non-conforming conditional use appears to turn on its deviation from the applicabl e conditions, not on the benefits of locating it at t he proposed site. Nevertheless, New Jersey law still required t he Board to consider the benefits of the proposed facility a t the balancing stage of its analysis. The record clearly shows that the Board did so, and that it found the benefi ts of locating the proposed facility at the proposed site to be outweighed by the negative consequences.

The providers' remaining challenges are essentially

derivative of the Telecommunications Act claims tha t we have already resolved. First, they claim that the B oard erroneously dismissed expert testimony that the pro posed monopole would have no detrimental impact on the va lue of surrounding homes, and thus gave too much weight to the negative criteria. We have already held that the Bo ard's findings on this issue were supported by substantia l evidence. Second, they renew their claim that the B oard had no authority to evaluate the quality of existin g wireless service, much less determine that it is adequate, a nd to discount the positive criteria accordingly. Again, we have already held that the Board was not barred from eva luating the quality of existing wireless service, though it s discretion in that area is subject to limitations. Finally, th e providers

18claim that the Board's assessment of existing wirel ess

service, and thus the weight given to the positive criteria, is erroneous because it improperly dismisses expert testimony, and relies instead on incompetent eviden ce. As we have already noted, we agree with the providers on this point. Consequently, we must reverse the district c ourt's summary judgment on the communication provider's st ate law claim. If, on remand, the Board reaches the bal ancing stage, it must adjust the weight given to the posit ive criteria (i.e., the public benefit of enhancing personal wir eless services in and around Ho-Ho-Kus) based on a proper evaluation of existing service, and in compliance w ith applicable state law.

III. Conclusions

In sum, we reverse the district court's summary judgment on both the Telecommunications Act and sta te law claims. We affirm its ruling that the Board was not barred from considering the quality of existing per sonal wireless service, and that its findings regarding t he proposed monopole's economic impact on surrounding properties was supported by substantial evidence. W e also conclude that the Board correctly identified the fa ctors affecting the positive criteria necessary to approv e a conditional-use variance under New Jersey law.

We remand to the district court with instructions t hat it remand for the Board to reconsider the proposed fac ility in compliance with this opinion. In doing so, we note that the Telecommunications Act requires the Board to act"wi thin a reasonable period of time." 47 U.S.C. S 332(c)(7) (B)(ii). We also note that the Board took two-and-a-half years to reach a final decision on the providers' original request to build the proposed facility. The extensive record develop ed during prior proceedings should significantly streamline t he process of reconsideration, and any undue delay in reaching a decision could justify injunctive relief in favor of the providers.

If, after reconsideration, the Board approves the p roposed facility, this matter will have reached its final e nd. If, however, the Board rejects the proposed facility fo r a

19second time, its decision will remain subject to

nondeferential review under the "effect of prohibit ing"

standard. The district court will then have to dete rmine whether there are any significant gaps in existing personal wireless services. If significant gaps exist, the c ourt must then determine whether the proposed facility willfi ll those gaps. We think it worth noting, however, that the Telecommunications Act does not abrogate local zoni ng authority in favor of the commercial desire to offe r optimal service to all current and potential customers. Hen ce, if the district court ultimately finds significant gaps in existing service, the providers still bear the burden of pro ving that the proposed facility is the least intrusive means of filling those gaps with a reasonable level of service.

A True Copy:

Teste:

Clerk of the United States Court of Appeals

for the Third Circuit

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