Opinion ID: 1931608
Heading Depth: 1
Heading Rank: 3

Heading: The School Waiver Agreements

Text: In the case sub judice, respondent and petitioners entered into written agreements whereby respondent agreed to issue a waiver of the school capacity requirements of the Adequacy of Public Facilities Ordinance in return for petitioners agreeing to convey land or contribute funds to help alleviate the alleged school capacity problems caused by their residential developments. [10] The four School Waiver Agreements at issue and discussed hereafter were executed between 1989 and 1999. Without these agreements, petitioners would not have been able to move forward with the recordation of their subdivisions because respondent would not have waived the requirements of Article 26. [11] The first of the school waiver agreements was effectuated in 1989 in connection with petitioners' proposed subdivision known as Seven Oaks. Respondent advised petitioners that existing school facilities were not adequate and that a school waiver fee agreement would be necessary in order to gain approval of petitioners' proposed subdivision. An agreement, entitled Seven Oaks School Agreement, dated March 22, 1989, was entered into between petitioners and respondent. Pursuant to the terms of this agreement, petitioners agreed to pay $4,700,000, in installments, to respondent. Then in February of 1995, petitioners and respondent entered into a second agreement called the Old Mill High School Agreement. Pursuant to the terms of this agreement, petitioners agreed to pay respondent $124,000 in exchange for a waiver of the Adequacy of Public Facilities Ordinance's requirements with respect to adequate school facilities, which were, allegedly, lacking for the Cantor Farms Subdivision. Thereafter on March 30, 1995, in connection with a proposed development in the Crofton area, Crofton Farms Development Corp., Severn Valley Farms, Inc., Halle Enterprises, and the Richard's Group of Washington entered into the Crofton Farms School Agreement, whereby Halle Enterprises agreed to convey a sizeable parcel of land to respondent in exchange for a waiver of the Adequacy of Public Facilities Ordinance's school requirements. The final school waiver agreement at issue in the case at bar was entered into on August 24, 1999, in respect to the proposed subdivision of Walnut View, whereby Arundel Homes and respondent entered into the Cape St. Clair Elementary School Agreement. Pursuant to this agreement, Arundel Homes paid $34,200 to respondent in exchange for a waiver of the Adequacy of Public Facilities Ordinance's requirements. [12] Petitioners alleged that they had no knowledge that respondents did not have the ability to grant waivers to the ordinance regarding adequacy of school facilities in exchange for financial considerations prior to February 11, 2000, when petitioners alleged that they read an article that appeared in The Baltimore Sun newspaper. This article discussed this practice and, according to petitioners, quoted a county legal representative as stating that the county ordinance [Adequacy of Public Facilities Ordinance] specifically forbids the granting of waivers for financial considerations. It was not until after they had read this article that petitioners, on September 5, 2000, filed suit against respondent in the Circuit Court for Anne Arundel County. [13] Petitioners alleged, inter alia, that respondent's collection of school waiver fees, be it the money or the property, from developers as a condition to recording their subdivisions was tantamount to an illegal excise tax without enabling statutory authority from the Maryland Legislature. On February 16, 2001, the Circuit Court issued an opinion and order which granted respondent's motion for summary judgment and denied petitioners' motion for summary judgment. The Circuit Court found that petitioners' claims were barred by the statute of limitations and res judicata, that petitioners' common law tort claims were barred by failure to give notice under the Local Government Tort Claims Act, and that respondent had the authority and power to collect the money and to accept the conveyances of land called for in the waiver agreements. Petitioners appealed to the Court of Special Appeals, which declined to address the trial court's findings on the issues of limitations, laches, or res judicata and rejected the lower court's findings regarding respondent's authority to impose such a tax but, nevertheless, held that the waiver agreements were valid contracts. The Court of Special Appeals further held that waiver authority was found in the reading of both Article 24 [14] and 26 of the AACC for respondent to raise revenue for capital improvements or receive compensation in the manner of the agreements at issue in the case sub judice and that the compensation received was not a tax. [15] Petitioners then noted an appeal to this Court and respondents noted a cross-appeal.