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SECOND GENERATION PROPERTIES v. TOWN OF PELHAM | FindLaw
SECOND GENERATION PROPERTIES v. TOWN OF PELHAM
SECOND GENERATION PROPERTIES, L.P., Plaintiff, Appellant, v. TOWN OF PELHAM, Defendant, Appellee.
No. 02-1688.
Before LYNCH, Circuit Judge, BOWNES, Senior Circuit Judge, and LIPEZ, Circuit Judge. Andrew R. Schulman with whom Getman, Stacey, Tamposi, Schulthess & Steere, P.A. was on brief for appellant. Diane M. Gorrow with whom Soule, Leslie, Kidder, Sayward & Loughman, P.L.L.C. was on brief for appellee.
In March 1999, the town passed a Personal Wireless Services Ordinance which authorizes the town's Planning Board to issue conditional use permits for the construction of cell towers in a newly established “Telecommunications Overlay Zone.” The Overlay Zone includes only areas currently zoned for industrial and commercial uses, and is separated from Route 128 by hills. A variance must be obtained from the ZBA to construct a tower outside the Overlay Zone. Since Second Generation's property is in a residential zone, it needed a variance.2
In February 2000, Second Generation filed a federal court complaint alleging that the ordinance violated the TCA by effectively prohibiting the provision of personal wireless services, in violation of 47 U.S.C. § 332(c)(7)(B)(i)(II) (2000), and unreasonably discriminating against some licensed wireless carriers, in violation of § 332(c)(7)(B)(i)(I). It also brought a claim against the town under 42 U.S.C. § 1983 (2000). The court issued a stay in August 2000 to allow Second Generation to seek a variance from the ZBA.
The Board voted unanimously to deny the variance on the ground that Second Generation failed to prove “hardship” as required by New Hampshire law.
Second Generation amended its complaint to challenge the ZBA decision as well as the ordinance. It alleged that Pelham had instituted an “absolute prohibition” against the construction of cell towers in residential zones, that at least four of the six licensed wireless carriers had significant coverage gaps along Route 128, and that it would be impossible to eliminate these gaps without building a cell tower in a residential zone. The ordinance and waiver, it asserted, violated 47 U.S.C. § 332(c)(7)(B)(i) by effectively prohibiting wireless service and unreasonably discriminating against the four carriers. It also added new claims that the ZBA's waiver denial was not supported by adequate written findings or substantial evidence in the record, in violation of § 332(c)(7)(B)(iii). Second Generation dropped its 42 U.S.C. § 1983 claim and its request for damages; it now requested only that the court enjoin the town ordinance.
The TCA preserves state and local authority over the siting and construction of wireless communication facilities, subject to five exceptions specified in the Act. 47 U.S.C. § 332(c)(7)(B); see Town of Amherst v. Omnipoint Communications Enters., Inc., 173 F.3d 9, 12 (1st Cir.1999). Two exceptions, the substantial evidence and effective prohibition clauses, are pertinent here.5 If a board decision is not supported by substantial evidence, § 332(c)(7)(B)(iii), or if it effectively prohibits the provision of wireless service, § 332(c)(7)(B)(i)(II), then under the Supremacy Clause of the Constitution, local law is pre-empted in order to effectuate the TCA's national policy goals.
A. Substantial Evidence Attack on ZBA Decision
The “substantial evidence” standard of review is the same as that traditionally applicable to a review of an administrative agency's findings of fact. Judicial review under this standard, even at the summary judgment stage, is narrow․ Substantial evidence is such relevant evidence as a reasonable mind might accept as adequate to support a conclusion․ [T]he possibility of drawing two inconsistent conclusions from the evidence does not prevent an administrative agency's finding from being supported by substantial evidence.
(1) a zoning restriction as applied to their property interferes with their reasonable use of the property, considering the unique setting of the property in its environment; (2) no fair and substantial relationship exists between the general purposes of the zoning ordinance and the specific restriction on the property; and (3) the variance would not injure the public or private rights of others.
Simplex Techs., Inc., 766 A.2d at 717. The ZBA found that Second Generation did not meet any of the prongs. It explained that the land, given its unique setting, could reasonably be used for the residential purposes for which it was zoned and that there was a fair and substantial relationship between the ordinance and the restriction on the property because the ordinance “prohibits obtrusive commercial uses from infiltrating the residential zone.”
B. Effective Prohibition Challenge
The more difficult question is whether, on the evidence before the district court, the denial of the variance sought by the landowner constituted an unlawful effective prohibition on the provision of wireless services. See § 332(c)(7)(B)(i)(II). This in turn raises a series of issues inherent in the “effective prohibition” analysis, including the requirements to show an effective prohibition; the contours of the “significant gap” formulation previously used by this court; and the relevance of evidence of coverage provided by roaming service, towers in other towns, and carriers not licensed in the town. Most significantly, it raises the question of the correctness of the rule adopted by the district court that if any carrier provides any coverage within a purported gap, then there cannot, as a matter of law, be an effective prohibition on the provision of wireless services. We disagree with and reject any such rule, but ultimately agree with the court's alternate ground for holding that there was no effective prohibition.
2. General Standards for Anti-Prohibition Clause
The rule in this circuit is that the TCA's anti-prohibition clause is not restricted to blanket bans on cell towers imposed by towns. Amherst, 173 F.3d at 14. The clause may, at times, apply to individual zoning decisions. Id. In invoking the effective prohibition language, “the burden for the carrier ․ is a heavy one: to show from language or circumstances not just that this application has been rejected but that further reasonable efforts are so likely to be fruitless that it is a waste of time even to try.” Id. A landowner tower developer is in no better position than a carrier and has an equally heavy burden.7
The TCA does not itself expressly authorize local zoning boards to consider whether individual decisions amount to an “effective prohibition.” See 47 U.S.C. § 332(c)(7). Since board actions will be invalidated by a federal court if they violate the effective prohibition provision, many boards wisely do consider the point. See, e.g., Amherst, 173 F.3d at 16. There appears to be nothing in New Hampshire law to preclude a board from considering the issue. The ZBA here implicitly did so by concluding that Second Generation had failed to show that there were no alternative sites to build a tower that would solve whatever coverage problem existed.8 No special deference is given to the board's conclusion on this point.
This court has identified two sets of circumstances where there is a prohibition “in effect.” The first is where the town sets or administers criteria which are impossible for any applicant to meet. See id. at 14. That was the situation in National Tower, which affirmed the district court's finding that a permit denial constituted an effective prohibition. See 297 F.3d at 23-25. The second involves the situation where the plaintiff's existing application is the only feasible plan; in that case, denial of the plaintiff's application “might amount to prohibiting personal wireless service.” Amherst, 173 F.3d at 14; accord Sprint Spectrum, L.P. v. Willoth, 176 F.3d 630, 640, 643 (2d Cir.1999).9 These factors, when pertinent, should be analyzed in determining whether there is an effective prohibition. This means, of course, that there can be no general rule classifying what is an effective prohibition. It is a case-by-case determination.
Second Generation then argues that the individual variance denial is an effective prohibition. The question of whether an individual denial is an effective prohibition is largely fact-driven. Since the effective prohibition clause is not self-explanatory, the importance of particular facts must be seen through the prism of the statutory language and intent. Overall, the TCA attempts to reconcile the goal of preserving local authority over land use with the need “to facilitate nationally the growth of wireless telephone service.” Amherst, 173 F.3d at 13. Congress intended to promote a national cellular network. Id.; see also Todd, 244 F.3d at 57 (TCA reflects Congress's intent to rapidly expand personal wireless services); President's Statement on Signing the Telecommunications Act of 1996 (February 8, 1996), reprinted in 3 Federal Telecommunications Law: A Legislative History of the Telecommunications Act of 1996, doc. 95, at 208 (B.D. Reams, Jr. & W.H. Manz eds., 1997) (TCA intended to promote universal service). The Act aims to secure lower prices and better service for consumers by opening all telecommunications markets to competition. See Telecommunications Act of 1996, Pub.L. No. 104-104, pmbl., 110 Stat. 56, 56; H.R. Conf. Rep. No. 104-458, at 113 (1996), reprinted in 1996 U.S.C.C.A.N. 10, 80.10 Thus, the Act attempts to reconcile the interests of consumers and residents (many of whom are themselves cell phone users).
a. “Significant Gap” Formulation
Courts have provided a judicial gloss on the effective prohibition language of the statute in order to determine whether a coverage problem exists at all. We have concluded that a town's refusal to permit a tower that is needed to fill a “significant [geographic] gap” in service, where no service at all is offered in the gap, would violate the effective prohibition clause. See Nat'l Tower, 297 F.3d at 20; accord Willoth, 176 F.3d at 643; APT Pittsburgh Ltd. P'ship, 196 F.3d at 480. The context in which a question arises is important. In National Tower, where this circuit adopted and employed a significant gap analysis, it was undisputed that no carrier provided coverage in the geographic gap area and that the gap affected the ability of a large number of users to connect or maintain a connection, id. at 17-18. The issue addressed in National Tower by the “significant gap” formulation, then, had to do with when a purported geographic gap, served by no carrier, is large enough in terms of physical size and number of users affected to amount to an effective prohibition, rather than being a mere, and statutorily permissible, dead spot. Federal regulations contemplate that areas enjoying adequate coverage will still include spots without reliable service. See 360 Degrees Communications Co., 211 F.3d at 87; 47 C.F.R. § 22.911(b) (2001); see also id. § 22.99 (defining dead spots as “[s]mall areas within a service area where the field strength is lower than the minimum level for reliable service”).
Like many legal concepts, the “significant gap” language used in one context is now being used by the parties to address a qualitatively different and much more complex set of problems. The parties use the phrase to frame arguments about whether an effective prohibition can exist in a geographic area where a carrier already provides some service. The ultimate question of course remains whether a given decision, ordinance, or policy amounts to an effective prohibition on the delivery of wireless services. Inquiries into the existence and type of gap are merely helpful analytic tools toward that end.11
b. Consideration of Services by Out-of-town Carriers
Second Generation raises a question of law as to whether the town or court may consider service by these carriers. In ascertaining the existence and extent of coverage for purposes of resolving an effective prohibition claim (and indeed the proposed solution), we hold it permissible to consider (1) roaming service, (2) the coverage provided from towers in other towns, and (3) service by carriers not licensed in the jurisdiction at issue. See Cellular Tel. Co., 197 F.3d at 71 (“Under the right conditions it may be possible to provide an adequate level of personal wireless services to a particular community solely through facilities located outside that community.”); accord Omnipoint Communications MB Operations, LLC v. Town of Lincoln, 107 F.Supp.2d 108, 117 n. 8 (D.Mass.2000).
3. Rejection of Rule That Any Coverage Equals No Effective Prohibition
A flat “any service equals no effective prohibition” rule would say a town could refuse permits to build the towers necessary to solve any number of different coverage problems.14 It is highly unlikely that Congress intended the many qualitatively different and complex problems to be lumped together and solved by a rule for all seasons that any coverage in a gap area automatically defeats an effective prohibition claim. Such a rule would be highly problematic because it does not further the interests of the individual consumer. To use an example from this case, it is of little comfort to the customer who uses AT & T Wireless (or Voicestream, Verizon, Sprint, or Nextel) who cannot get service along the significant geographic gap which may exist along Route 128 that a Cingular Wireless customer does get some service in that gap. Of course, that AT & T customer could switch to Cingular Wireless. But were the rule adopted, the same customer might well find that she has a significant gap in coverage a few towns over, where AT & T Wireless, her former provider, offers service but Cingular Wireless does not. The result would be a crazy patchwork quilt of intermittent coverage. That quilt might have the effect of driving the industry toward a single carrier. When Congress enacted legislation to promote the construction of a nationwide cellular network, such a consequence was not, we think, the intended result, see, e.g., S.Rep. No. 104-23, Purpose of the Bill (1995), reprinted in 1 Federal Telecommunications Law, supra, doc. 2, at 1 (bill aims to “open [ ] all telecommunications markets to competition”); H.R.Rep. No. 104-204, Purpose and Summary (1995), reprinted in 1 Federal Telecommunications Law, supra, doc. 3, at 47-50.15 The fact that some carrier provides some service to some consumers does not in itself mean that the town has not effectively prohibited services to other consumers.
§ 332(c)(7)(B). We start with the fact that Congress used “services” and not “service.” A straightforward reading is that “services” refers to more than one carrier. Congress contemplated that there be multiple carriers competing to provide services to consumers. That one carrier provides some service in a geographic gap should not lead to abandonment of examination of the effect on wireless services for other carriers and their customers. Next, the phrase “have the effect of prohibiting” may well refer to actions that mostly prohibit. For example, B.A. Garner, A Dictionary of Modern Legal Usage 256 (2d ed. 1995), gives as the first definition of effective “having a high degree of effect.” (emphasis added). Accord B.A. Garner, A Dictionary of Modern American Usage 237-38 (1998). Moreover, a common reading of the word “prohibition” standing alone would apply to a situation of denial of services to the vast majority of users. See, e.g., Oxford English Dictionary (2d ed. 1989) (defining “prohibit” as “to prevent, preclude, hinder”) (emphasis added). Thus Congress may well have meant the effective prohibition clause to reach certain situations in which there is some coverage in a gap.
One might hypothesize that the “unreasonable discrimination” language of the Act would adequately address situations where customers of some but not all carriers lack service in an area. The argument would proceed that the anti-prohibition clause should be strictly read as applying only to de jure and de facto absolute prohibitions. This court has not yet explicated the unreasonable discrimination clause and we do not do so here. Nevertheless, the law from other circuits gives little reason to think this clause will effectively safeguard congressional efforts to promote the building of a nationwide cellular network. Some courts have held that towns can discriminate against proposals that have different aesthetic or safety ramifications, Willoth, 176 F.3d at 638-39; see also H.R.Rep. No. 104-458 (1996), reprinted at 1 Federal Telecommunications Law, supra, doc. 5, at 208; S.Rep. No. 104-230 (1996), reprinted in 1 Federal Telecommunications Law, supra, doc. 6, at 208, or a different structure, placement, or cumulative impact, see Nextel W. Corp. v. Unity Township, 282 F.3d 257, 267 (3rd Cir.2002). See generally AT & T Wireless PCS, Inc. v. City Council of Va. Beach, 155 F.3d 423, 427 (4th Cir.1998) (some discrimination between providers of functionally equivalent services is allowed).
4. Effective Prohibition and Other Potential Solutions
1. Pelham, New Hampshire is on the Massachusetts border just north of Lowell, Massachusetts and Dracut, Massachusetts and midway between Salem, New Hampshire and Nashua, New Hampshire. It lies between Interstate 93 and U.S. 3, the two major north-south highways serving New Hampshire's southern tier.
2. The Planning Board had obtained a legal opinion and public comment, conducted research on limiting cell towers to commercial or industrial zones, and discussed associated technological, economic, safety, and social issues. It met with Blaine Hopkins, Second Generation's expert; Hopkins proposed a multi-district overlay zone, which the board rejected. The Planning Board did not, however, retain its own expert, contact wireless carriers, commission a radio frequency propagation study, evaluate the characteristics of various sites, or attempt to formally assess the quality of existing service.
3. The town's planning director acknowledged that her own cell phone did not work on the southern part of Route 128.
4. The ZBA member observed that in a housing market appreciating at a rate of 1.5 percent per month, the fact that home values have remained stable over a few years is consistent with the proposition that cell towers reduce property values.
5. A third exception is that a local board decision will not be upheld if it unreasonably discriminates “among providers of functionally equivalent services.” § 332(c)(7)(B)(i)(I). Although such a claim was made in the complaint, it has been abandoned. Second Generation, 2002 WL 1018923, at *2 n. 4.
6. Olszak provides that in order to obtain a variance, Second Generation had the burden to show: (1) a denial of the variance would result in unnecessary hardship to the applicant; (2) surrounding properties would suffer no diminution in value; (3) the proposed use would not be contrary to the spirit of the ordinance; (4) granting the variance would benefit the public interest; and (5) granting the variance would do substantial justice. 661 A.2d at 771.
7. The landowner who wishes to build a tower on its site is a unique plaintiff. A landowner does not have an incentive to identify possible sites on land it does not own. A landowner differs from a service provider, whose incentive is to choose from among all possible sites the option providing the cheapest, highest quality service.
8. It is not the town's burden, in response to an effective prohibition claim and where plaintiffs have produced no contrary evidence, to show in the first instance that alternative sites do exist. Nat'l Tower, 297 F.3d at 24. Nor is it the town's burden, in responding to a claim that its decision is not supported by substantial evidence, to show that alternative sites were available. Southwestern Bell, 244 F.3d at 63.
9. The Third Circuit has suggested that the denial of a permit for a site that is the least intrusive means to close a significant gap in service would amount to a violation of the anti-prohibition clause. APT Pittsburgh Ltd. P'ship v. Penn Township Butler County, 196 F.3d 469, 479-80 (3rd Cir.1999); see Cellular Tel. Co. v. Zoning Bd. of Adjustment, 197 F.3d 64, 70 (3rd Cir.1999). The question of rejection of the least intrusive means must itself be evaluated in the context of the other options available. See 360 Degrees Communications Co. v. Bd. of Supervisors, 211 F.3d 79, 87 (4th Cir.2000) (“A community could rationally reject the least intrusive proposal in favor of a more intrusive proposal that provides better service or that better promotes commercial goals of the community.”). This court has not addressed that precise point, nor need we do so here. See generally Indus. Communications and Elecs., Inc. v. Town of Falmouth, 2000 WL 761002 (D.Me. May 9, 2000) (order) (distinguishing between the Third Circuit's least intrusive means approach and the First Circuit's Amherst analysis).
10. The committee reports and presidential and vice-presidential statements on the TCA and its precursors do not discuss the meaning of the effective prohibition section. See 1, 3 Federal Telecommunications Law, supra.
11. Perhaps in recognition of the complexity of applying such an analysis in varying situations, the Fourth Circuit found unhelpful “additional formulation[s]” such as the “significant gap” phrase. 360 Degrees Communications Co., 211 F.3d at 87.
12. In this case, no information has been provided as to whether towers in nearby towns can host additional carriers. See generally R. Long, Allocating the Aesthetic Costs of Cellular Tower Expansion: A Workable Regulatory Regime, 19 Stan. Envtl. L.J. 373, 386-87 (2000) (observing that “co-location” on the same tower of antennas belonging to multiple carriers has become an increasingly common practice). We would view very differently a case in which a town attempted to deflect onto another jurisdiction the need to build new towers necessary to provide services to meet the TCA's goals where no service has been provided.
13. The district court also thought the Second Circuit had adopted such a rule in Sprint Spectrum L.P. v. Willoth, 176 F.3d 630 (2d Cir.1999). We read the case differently. The relevant passage appears to hold that once a carrier has adequate (though less than perfect) service in an area, local boards can deny applications by that carrier for additional towers without violating the effective prohibition clause. Id. at 643. This reading is buttressed by the context in which this passage appears: the following two paragraphs explain that there is no effective prohibition because Sprint could provide adequate coverage with just one or two towers rather than the three towers it requested in its application. Id. at 643-44. The court's effective prohibition analysis does not discuss the provision of wireless services by other carriers. Id. at 639-44. Furthermore, its stress on adequate coverage should logically mean that circuit would oppose an “any coverage equals no gap” rule. See id. at 643 (“Furthermore, once an area is sufficiently serviced by a wireless service provider, the right to deny applications becomes broader: State and local governments may deny subsequent applications without thereby violating subsection B(i)(II).”) (emphasis added).
14. Problems could arise in the following situations.1) The only carrier providing service in a gap area does not provide service nationwide. The established carriers want to fill a significant geographic gap in their nationwide networks by constructing a tower in the town. The town denies the established carriers' application to build a tower in the only feasible location on the ground that a carrier already provides service in the town.2) A gap is served by carrier A, which provides coverage for 1% of the cell phone users in the area. Some 99% of local users, who subscribe to different carriers, have no service in the gap. There is no more room on the tower used by carrier A to add the other carriers and the town denies a permit to build a tower in the only other feasible location.3) Carrier A, using a minority technology, provides service in a gap. A town then refuses to permit the construction of a tower to serve the carriers who use the alternative and prevalent technology. Or vice-versa. There are no feasible alternatives.4) Carriers first provide service in the geographic gap to a small percentage of potential users and then the number of subscribers grows exponentially such that there is a deterioration of services. The majority of calls fail in a new geographic gap but occasionally some go through. The carriers want to build a new tower in the only feasible location so the customers can receive uninterrupted service. The town denies a permit.5) A new generation of technology emerges but it cannot compete with older technologies because carriers using the new technology cannot build towers in the only feasible locations. The town denies permits on the ground that old technology carriers already provide service in the area.
15. That the district court's rule may have some anti-competitive effects seems reasonable. But no evidence on the severity of these effects or other economic implications has been provided by the parties. In the absence of such evidence, we proceed cautiously. See Denver Area Educ. Telecomm. Consortium, Inc. v. F.C.C., 518 U.S. 727, 742, 116 S.Ct. 2374, 135 L.Ed.2d 888 (1996) (“[A]ware as we are of the changes taking place in the law, the technology, and the industrial structure related to telecommunications, we believe it unwise and unnecessary definitively to pick one analogy or one specific set of words now.”) (citation omitted); id. at 777, 116 S.Ct. 2374 (Souter, J., concurring) (because the technology is continuing to evolve, and because technological changes have substantial regulatory implications, “we should be shy about saying the final word today about what will be accepted as reasonable tomorrow”).