1 STATE OF VERMONT

ENVIRONMENTAL COURT

} In re Gizmo Realty/VKR Associates, LLC } Docke t No. 199-9-07 Vtec (Appeal of Act 250 Permit #3R0990) } }

Decision on the Merits Appellant Two Rivers-Ottauquechee Regional Planning Commission (“Appellant” or “Regional Commission”) has appealed an approval by the District #3 Environmental Commission of an Act 250 permit application of Gizm o Realty Holdings I, LLC, as developer and VKR Associates, LLC, as landowner (hereinafter collectively referred to as “Gizmo”) for a commercial development to be known as “Bradford Squ are Shopping Center” and located along the easterly side of U.S. Route 5, near the interch ange associated with Exit 16 of Interstate 91 (“I-91”). The Regional Commission expressed concer ns regarding the project’s conformance with the Two Rivers-Ottauquechee Regional Plan (“Re gional Plan”). When our April 30, 2008 Decision on cross-motions for summary judgment reso lved some, but not all, of the legal questions posed in this appeal, the matter was ther eafter set for trial. The Court participated in a site visit and then presided over a merits hearing, which was followed by the parties’ post-trial briefings. The Regional Commission was assisted prior to trial by Amanda S.E. Lafferty, Esq., and at trial by Steven F. Stitzel, Esq. Applicant Gizm o has been represented throughout these proceedings by John C. Candon, Esq.
Procedural Background Early last year, each party filed a motion requesti ng that the Court enter summary judgment in its favor on each of the three legal is sues raised in Appellant’s Statement of Questions. By its April 30, 2008 Decision, this Co urt dismissed Appellant’s Question 1, entered summary judgment in Gizmo’s favor as to Appellant’s Question 2, and denied both parties’ summary judgment requests on Appellant’s Question 3 , thereby leaving that issue to be litigated at trial. The Regional Commission sought a modific ation of the Court’s April 30, 2008 Decision, which the Court denied by Entry Order dated June 23 , 2008.2

In its post-trial legal memorandum, the Regional Co mmission again asserts that it was
error for the Court to conclude that Gizmo was enti tled to have its Act 250 application considered for conformance with the prior Regional Plan, known as the 2003 Regional Plan, and not the Regional Plan that had just been amended at the time Gizmo submitted its Act 250 application. 1 To the extent that the Regional Commission’s post-t rial legal memorandum is intended as a request that the Court amend its April 30, 2008 D ecision, we respectfully decline to do so. The Court continues to believe that it correctly addres sed the specific legal issue raised by the parties’ pre-trial motions and addressed by the Court’s Apri l 30, 2008 Decision. We continue to recognize that our April 30, 2008 De cision may initially appear to run counter to the general maxim that an applicant’s ri ghts only vest upon the filing of a complete land use application. Smith v. Winhall Planning Co mm’n , 140 Vt. 178, 181 (1981). However, a closer examination reveals that our April 30, 2008 Decision does not run counter to this general maxim. Rather, we concluded that where a developer diligently pursues municipal permit approval for its project, the developer enjoys a ve sted right to Act 250 criterion 10 review under the regional plan that was in effect at the time th e developer submitted a complete zoning application, even when the regional plan was revise d prior to the filing of the developer’s Act 250 project application. See April 30, 2008 Decisi on at 4–8 (following the rationale of In re Burlington Broadcasters, Inc. d/b/a WIZN, et al. , No. 4C1004R-EB, Memorandum of Decision on Group 2 Preliminary Issues, slip op. at 6–8, 11 (Vt. Envtl. Bd. Nov. 25, 2003), available at http://www.nrb.state.vt.us/lup/decisions/2003/4c100 4r-eb-grp2pi-mod.pdf (citing In re Molgano
, 163 Vt. 25, 32–33 (1994)). In arriving at this det ermination, we also relied upon the rationale that this non-rigid view of vesting, particularly i n relation to conformance with a regional plan under Act 250 criterion 10, is an established and m ore proper outcome here, given that modern land use development has become “‘an intensely regu lated process requiring compliance with a host of complex land use regulations and the issuan ce of multiple governmental approvals prior to ground-breaking.’” Id . at 6 (quoting Grayson P. Hanes & J. Randall Minch ew, On Vested

1 The subsequently amended Plan is commonly known a s the 2007 Regional Plan. In reviewing the details offered by the Regiona l Commission, we note that although the Commission adopted the 2007 Regional Plan on May 30, 2007, the 2007 Region al Plan did not become effective until July 4, 2007 . Given that Gizmo filed its Act 250 application on June 12 , 2007, it is not accurate to characterize Gizmo’s application as having been submitted “after” the 2007 Regional Pla n came into effect.3

Rights to Land Use and Development , 46 Wash. & Lee L. Rev. 373, 389 (1989)). Thus, t o the extent that the Regional Commission’s post-trial me morandum was intended as a renewed request to alter our April 30, 2008 Decision, that request is DENIED

. Findings of Fact Before rendering specific findings, we note that wh ile this is a de novo appeal, our review is limited to the factual issues preserved for our review by the Appellant’s Statement of Questions. V.R.E.C.P. 5(f); see also Vill. of Wood stock v. Bahramian , 160 Vt. 417, 424 (1993). The Regional Planning Commission filed a Statement of Questions posing three Questions. By our April 30, 2008 Decision, we dismissed Question 1 (which asked if the project would have a substantial regional impact), and entered summary j udgment in Gizmo’s favor as to Question 2 (which asked which regional plan should be given ef fect in this appeal). Given our April 30, 2008 Decision, which announced our determination that the 2003 Regional Plan controls in this appeal, the Regional Commission conceded that there was no conflict between the 2003 Regional Plan and the Tow n of Bradford Municipal Plan (“Town Plan”) and that therefore the Court was not charged with determining whether the proposed project “would have a substantial regional impact.” 2 See 24 V.S.A. § 4348(h)(2); see also In re
Green Peak Estates , 154 Vt. 363, 367–68 (1990) (explaining the effect of § 4348). Thus, we are left to adjudicate in this appeal a so le legal question (Appellant’s Question 3): “Is the project under consideration in conforma nce with the Two Rivers-Ottauquechee Regional Plan?” Based upon the evidence presented and admitted at trial, as put into context by the site visit the Court conducted with the parties , and after assigning the appropriate weight and credibility to the admitted evidence, the Court ren ders the following factual findings relevant to that sole legal question (as well as the background and context surrounding that issue):
Two Rivers-Ottauquechee Regional Planning Commissio n and Regional Plans
1. Two Rivers-Ottauquechee Regional Commission is a la wfully created regional planning commission with the duties and responsibilities art iculated in 24 V.S.A. § 4345a.

2 The Regional Commission continues to assert that the project will have a substantial impact upon the neighboring downtown and village center districts, areas which the 2003 Regional Plan seeks to protect. We addres s the anticipated impact of the proposed project on these areas in the Discussion section of this Decision.4

2. For the period running from July 30, 2003, through July 3, 2007, the Regional Commission had in effect a regional plan lawfully a dopted pursuant to 24 V.S.A. § 4348. This regional plan is commonly referred to as the 2003 R egional Plan.
3. The Regional Commission adopted an updated and amen ded regional plan on May 30, 2007, to become effective July 4, 2007. This regio nal plan is commonly referred to as the 2007 Regional Plan.
Gizmo Application Timelines and Components of the P roposed Project
4. Gizmo first sought municipal approval for the propo sed Bradford Square Shopping Center; their completed application was received by the Town of Bradford on February 23, 2007.
5. The project site consists of 5.73± acres, of which 4.5± acres is considered primary agricultural soils. The project site is located on the easterly side of U.S. Route 5, which is also
known in this area as Lower Plains Road.
6. The proposed Bradford Square Shopping Center is dep icted on Gizmo’s site plan sheet C-1, admitted into evidence as Exhibit 1. Included in the proposed project are two larger buildings (Building A of 9,100 square feet and Buil ding B of 17,000 square feet) and three smaller buildings (Buildings C, D, and E, of 2,900 square feet, 9,000 square feet, and 7,350 square feet, respectively). 3 While the specific tenants for each building were not identified at trial, Gizmo anticipates that a grocery store may o ccupy one of the larger buildings and a dry goods retailer may occupy another building.
7. The project will be served by a single curb cut on U.S. Route 5. The five proposed buildings will surround an internal parking area to be used by all buildings. The project includes landscaped buffers near the borders of neighboring developed properties.
8. The project will be served by a municipal water sup ply system and on-site wastewater
and stormwater treatment facilities.
9. Gizmo proposes to develop the project in two phases : Phase 1 will include site improvements and the two larger buildings, located on the southern edge of the developed property; Phase 2 two will include the three remain ing buildings. Details of the Phase 2

3 The square footage listed here for Buildings C, D , and E are reflected on the Gizmo site plan (Exhib it 1). Testimony at trial included slightly different squa re footage estimates. To the extent that this pres ents a conflict within Gizmo’s offered testimony, we conclude that it is not material, since Gizmo has asked only for conceptual approval of these buildings.5

buildings have not been finalized; Gizmo has reques ted only conceptual approval of the Phase 2 buildings.
10. The site improvements Gizmo proposes include landsc aping both inside the area to be surrounded by the buildings and along the boundarie s to adjacent properties, sidewalks for pedestrians and bicycle paths and racks for cyclist s, and directional signs for traffic and parking.
11. Gizmo’s municipal application was approved on May 1 5, 2007. No appeal was taken from that approval.
12. On or about June 12, 2007, Gizmo applied to the Dis trict #3 Environmental Commission (“District Commission”) for Act 250 land use approv al for its proposed commercial development. 4 The project was not changed in a material manner between the time of the municipal approval and the submission of the Act 25 0 application.
Project District and Surrounding Areas
13. The proposed development is located in an area adja cent to I-91 Exit 16 and identified in both the Regional and Town Plans as an interchange growth area.
14. The Two Rivers-Ottauquechee Regional Commission is a compact of twenty-seven municipalities in the east central region of our St ate. Because of the proximity to Interstates 89 and 91, several of these municipalities are host to interstate highway interchange areas.
15. In the chapter relating to land use goals and expec tations (Chapter III), the 2003 Regional Plan speaks to specific land use issues, opportunit ies, and policies for the seven interstate interchange areas. Id . at 36–39. Interchange areas in Fairlee and Sharo n are considered to be part of existing village settlements and their exte nsions; the interchange areas located in Bradford, Newbury, Royalton, Randolph, and Thetford are separate from the established town centers and therefore present separate land use iss ues and opportunities.
16. The Bradford interstate interchange area (“Bradford Interchange”) is adjacent to but separate from an area designated as the Bradford To wn Center. Another designated area, wholly encompassed by the Town Center area, is known as th e Bradford Downtown Designation area.
17. The Bradford Interchange area was transformed from a primarily agricultural area by the construction and opening of I-91 in the early 1970s . Since then, the Bradford Interchange area

4 As noted above, Gizmo’s Act 250 application was s ubmitted after the 2007 Regional Plan was approved on May 30, 2007, but before it went into effect on July 4, 2007.6

land uses have changed from primarily agricultural uses (with some residential uses) into
commercial and industrial uses.
18. The subject property is in a portion of the Bradfor d Interchange area known as the Lower Plain. Gizmo’s proposed development is between .75 and 1.25 miles from developments in the Bradford Downtown Designation area. East of the su bject property is the Bradford Industrial Park; Oak Brothers Lumber Yard is to the north. Ot her area developments include the Huntington Homes commercial offices, one or more gr ocery stores, a large dry goods store, gas stations (some including convenience stores), one o r more restaurants, and several residences, some of which include home occupation facilities.
19. The Town once considered an extension of municipal sewer services to allow for continued, planned growth in the Bradford Interchan ge area, recognizing “that extending sewer services to the Lower Plain could provide an opport unity to intensely develop the area and to give Bradford needed space for community services a nd industry.” 2003 Regional Plan at 39.
20. The downtown area in Bradford is host to a mix of c ommercial and retail businesses, residences, civic and government uses. The testimo ny presented the downtown area as having the same qualities that define many Vermont village centers: vibrant, but in need of constant work and attention by its residents to keep it vibr ant.

Discussion As was the duty of the District Commission when it first reviewed Gizmo’s application, we are charged with the responsibility of determini ng whether Gizmo’s proposed development of the Bradford Square Shopping Center supports positi ve findings under Act 250 criterion 10. 10 V.S.A. § 6086(a)(10). Appellant’s sole remaining Q uestion confines our analysis to a subset of Act 250 criterion 10; the only legal issue before u s is whether the proposed project conforms to the applicable regional plan. In regard to this cr iterion, the burden of proof is on the applicant. 10 V.S.A. § 6088(a). We addressed this legal issue in a partial manner i n our April 30, 2008 Decision. Because we did not then have a complete copy of the 2003 Regional Plan presented to us, and because our analysis on the conformance issue neede d to be so fact specific, we declined to grant either party’s summary judgment motion and directed the parties to prepare for trial. At trial, Gizmo presented evidence concerning the s ubject property, the proposed project, and the development of neighboring properties. The Regional Commission did not contest much7

of this evidence. The parties did, however, disput e the effect of such evidence—namely, whether the proposed development would have a subst antial impact upon the Bradford Town Center and Downtown Designation areas that the 2003 Regional Plan explicitly seeks to protect. We first note that the 2003 Regional Plan acknowled ges that the interstate highway interchanges—and the development encouraged by thes e interchanges—can potentially have substantial impacts upon town centers and village s ettlements: Because past and present land use policy strongly a ffirms town centers and village centers as the principal areas for service, retail, civic, and institutional uses, it is in the interest of the Region that these areas continu e to serve these vital functions. Accordingly, interchange development should not be promoted at the expense of town village centers or when it unreasonably endang ers public investment in highways and transportation facilities serving the interchange. 2003 Regional Plan at 36.
The Regional Plan encourages development in certain interstate interchange areas, provided it fits within an established land use pla n that: c) maintain[s] a high standard of scenic amenities for visually sensitive areas with due regard to impacts on neighboring land uses and highway users; d) discourage[s] creation or establishment of uses deemed more appropriate to town centers and village settlements; and e) encourage[s] planned unit developments (such as trucking terminals, industrial and office parks, service centers, professional off ices and public buildings).
Id . at 37.
The Bradford Interchange area already hosts a mix o f land uses and developments, including residential, retail, commercial, and indu strial developments. The Regional Commission correctly notes that the 2003 Regional P lan represents the region’s established goals for future development and that approval of future development should be guided by such goals and not directed by what type of development alread y exists. But we note that the development that currently exists within the Bradford Interchan ge area is material to our determination of what impact the proposed project may have on the to wn center and village settlements the 2003 Regional Plan seeks to protect. The Regional Commission’s argument, taken to its ne xt logical conclusion, appears to be that the 2003 Regional Plan prohibits retail and si milar village center businesses from being8

established anywhere outside of the Town Center. W e can find no such language in Chapter III of the 2003 Regional Plan. See id . at 36–39. We recognize that the evidence presented at trial e stablished that the Bradford Town Center and Downtown Designation areas are vital and vibrant village centers which require vigilant planning protections. While it is undispu ted that the proposed project could host retail
businesses that could also be sited within the Brad ford Town Center, we cannot interpret any portion of the 2003 Regional Plan as prohibiting th e establishment of such businesses in any area
of Bradford other than the Town Center. The fact t hat such businesses already exist in the Bradford Interchange area leads us to conclude that the Bradford Town Center and Downtown Designation areas have not been substantially affec ted by the existing development in the Bradford Interchange area and that the proposed pro ject, with development and uses similar to that which already exist in the Bradford Interchang e area, is unlikely to have a substantial impact upon the downtown and village areas that the 2003 R egional Plan seeks to protect. We therefore conclude that the proposed project is not in confli ct with the Regional Plan provisions that were the subject of the parties’ legal disputes in this appeal. The Regional Commission presented a further point i n its post-trial filings that warrant our consideration—namely, the contention that the p roject will have a “substantial impact” on the neighboring Town Center in violation of the 200 3 Regional Plan. See 2003 Regional Plan at 37. While the Regional Commission concedes that, g iven this Court’s prior ruling that Gizmo is entitled to review of its Act 250 application under the 2003 Regional Plan, it is not necessary for the Court to determine whether the project represen ts a “substantial regional impact” under 24 V.S.A. § 4348(h)(2), the Court must recognize that the project will have a “substantial impact” upon the neighboring Town Center, including the des ignated downtown area. The collective square footage of the proposed proje ct (about 45,000 square feet) represents more than half of the Regional Commissio n’s estimates of all retail and office space
within the Bradford downtown area. But this fact a lone is not a sufficient foundation for us to conclude that the proposed project will have a “sub stantial impact” on the downtown area. The Regional Commission expresses a fear that the colle ctive size of the proposed project will attract commercial activity away from the neighboring Bradf ord Town Center. Such fears may have merit, but there was little factual foundation pres ented at trial that would allow us to render such a conclusion. In fact, the pre-existence of simila r commercial developments within the Bradford9

Interchange area, with no evidence presented of a c onsequent degradation caused to businesses in the neighboring Town Center, leads us to conclud e that it is not likely that the proposed project will have the substantial impact on the Tow n Center that the Regional Commission fears. We therefore conclude that while it may be accurate to describe this project as “substantial,” given its collective size, we are without facts to support a conclusion that it will have a substantial impact on the Town Center and village settlement that the 2003 Regional Plan seeks to protect. We conclude that the credible evidence presented shows that the proposed project conforms to the 2003 Regional Plan. Given that thi s was the only legal issue preserved for our review in this appeal, and that the District Commis sion rendered positive findings on all other Act 250 criteria relevant to the Gizmo application, we conclude that Gizmo should be granted an Act 250 permit.

Conclusion For all the reasons detailed above, we conclude tha t the Bradford Square Shopping Center that Gizmo proposes to develop within the Br adford Interchange area, if developed as represented in the application materials presented, is in conformance with the applicable Two Rivers-Ottauquechee Regional Plan. Given that Gizm o received positive findings from the
District #3 Environmental Commission on all other a pplicable Act 250 criteria (see 10 V.S.A. § 6086(a)), we hereby remand this matter back to th e District #3 Environmental Commission so that it may complete the ministerial act of issuing an amended Act 250 permit in conformance with this Decision. We note that this Decision sup ersedes the District Commission’s Findings of Fact as to conformance with the applicable regional plan, but in all other respects the District Commission’s other Findings of Fact remain in full force and effect.

Done at Newfane, Vermont this 10th day of March 200 9.

___________________________________ Thomas S. Durkin, Environmental Judge