Court Opinion

ID: 2669322
Source: CourtListenerOpinion
Date Created: 2014-04-09 18:30:14.259153+00
Date Added: 2024-06-11T13:03:06.026862
License: Public Domain

UNITED STATES DISTRICT COURT
                           FOR THE DISTRICT OF COLUMBIA

 2910 GEORGIA AVENUE LLC,

    Plaintiff,
                                                        Civil Action No. 12-1993 (CKK)
           v.

 DISTRICT OF COLUMBIA, et al.,

    Defendants.

                                MEMORANDUM OPINION
                                    (April 9, 2014)

       Plaintiff 2910 Georgia Avenue LLC filed suit against the District of Columbia, Mayor

Vincent C. Gray, and Michael P. Kelly in his official capacity as Director for the Department of

Housing and Community Development (“DHCD”), alleging the District of Columbia’s

Inclusionary Zoning Program constitutes an unconstitutional taking and violates the Plaintiff’s

substantive due process rights. On September 30, 2013, the Court denied in part and granted in

part Defendant’s Motion to Dismiss Plaintiff’s Complaint. See Mem. Op. & Order, ECF Nos.

[20], [21]. In relevant part, the Court granted Defendant’s Motion to Dismiss Plaintiff’s takings

claims against the set-aside requirement of the Inclusionary Zoning Program on the basis that

that claim was not ripe, but denied Defendant’s Motion to Dismiss with respect to Plaintiff’s

challenge to the Inclusionary Development Covenant finding that it was ripe. Mem. Op. at 1.

Presently before the Court is Defendants’ [24] Motion for Reconsideration of the Court’s holding

that Plaintiff’s challenge to the Inclusionary Development Covenant is ripe.1 Upon consideration

       1
         Defendants’ Motion was originally styled as a Motion for Clarification of the Court’s
September 30, 2013, opinion. However, in an October 17, 2013, Minute Order, the Court stated
it would treat Defendant’s Motion as a Motion for Reconsideration.
of the pleadings,2 the relevant legal authorities, and the record for purposes of this motion, the

Court DENIES Defendant’s Motion for Reconsideration for the foregoing reasons.

                                   I.         LEGAL STANDARD

   To prevail on a Motion for Reconsideration, the movant bears the burden of identifying an

“intervening change of controlling law, the availability of new evidence, or the need to correct a

clear error or prevent manifest injustice.” Firestone v. Firestone, 76 F.3d 1205, 1208 (D.C. Cir.

1996)). However, “[m]otions for reconsideration are disfavored[.]”     Wright v. F.B.I., 598

F.Supp.2d 76, 77 (D.D.C. 2009) (internal quotation marks and citation omitted).             “The

granting of such a motion is . . . an unusual measure, occurring in extraordinary

circumstances.” Kittner v. Gates, 783 F.Supp.2d 170, 172 (D.D.C. 2011).             Accordingly,

Motions for Reconsideration may not be used to “relitigate old matters, or to raise arguments

or present evidence that could have been raised prior to the entry of judgment.” Jung v. Assoc.

of Am. Med. Colls., 226 F.R.D. 7, 9 (D.D.C. 2005) (internal quotation marks and citation

omitted).

                                        II.     DISCUSSION

       In Defendants’ original Motion to Dismiss, Defendants moved the Court to dismiss

Plaintiff’s challenge to the Inclusionary Development Covenant as unripe. See Def.’s Mot. to

Dismiss at 20-29. Plaintiff countered that its challenge to the Covenant was ripe because DHCD

has the authority to release the Covenant and Plaintiff had requested that DHCD release or

modify the Covenant and DHCD refused. See Pl.’s Opp’n. to Mot. to Dismiss at 11. In the

Court’s September 30, 2013, decision, the Court agreed with Plaintiff that DHCD had the

       2
         Defendants’ Motion for Reconsideration (Defs.’ Mot.), ECF No. [24]; Plaintiff’s
Opposition (“Pl.’s Opp’n.), ECF No. [26]; Defendants’ Reply (Def.’s Reply), ECF No. [27].
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authority to waive the Covenant and that Plaintiff’s claim became ripe upon DHCD’s refusal of

Plaintiff’s request that the Covenant be waived. Mem. Op. at 11.

       Defendants’ Motion for Reconsideration now challenges the Court’s reasoning in

determining that DHCD has authority to waive the Covenant. Specifically, Defendants contend

that the Court was mistaken in concluding that “[n]either the requirement that a covenant be

executed, nor the provisions of the covenant, are dictated by the Inclusionary Zoning Act or the

Zoning Commission regulations; both are established by DHCD’s implementing regulations

codified in title 14, chapter 22, and thus can be waived by the DHCD.” Def.’s Mot. at 2-3 (citing

Mem. Op. at 11). Defendants argue—with far more clarity and focus than they did in their

original briefing—that DHCD does not have the authority to waive the Inclusionary

Development Covenant because the Inclusionary Zoning Act requires an inclusionary

development owner to execute a covenant and under § 2223.1 of DHCD’s implementing

regulations, DHCD is precluded from waiving any provision that is “required by the Zoning

Commissions’ Inclusionary Zoning Regulations or the Inclusionary Zoning Act.” D.C. Mun.

Regs. tit. 14 § 2223.1(b). Defendants argue that “DHCD can only waive those provisions

contained in the IZ Covenant which derive from DHCD’s Implementing Regulations only and

not the IZ Act or the IZ Regulations.” Def.’s Mot. at 4.

       After reviewing Defendants’ arguments in support of their Motion for Reconsideration,

the Court finds that Defendants are correct that the Inclusionary Zoning Act requires an

inclusionary development owner to execute a covenant.              The Inclusionary Zoning Act

specifically states that, in order for a building permit to be issued for an Inclusionary

Development, a covenant must be recorded “that binds all persons with a property interest in any

or all of the Inclusionary Development to construct and reserve the number of inclusionary units

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indicated on the Certificate of Inclusionary Zoning Compliance, and to sell or rent, as applicable,

such units in accordance with the Inclusionary Zoning Program and the Certificate of

Inclusionary Zoning Compliance . . . .” D.C. Code § 6-1041.05. However, “the establishment of

enforcement mechanisms such as covenants and certifications shall be as determined by the

Council and Mayor of the District of Columbia.” D.C. Mun. Regs. tit. 11, § 2600.2 (emphasis

added).     DHCD is charged with administering the regulations implementing the Zoning

Commission’s       Inclusionary   Zoning    Regulations    and   the   Inclusionary   Zoning   Act

(“implementing regulations”), see D.C. Mun. Regs. tit. 14, § 2200.1, which include the

regulations establishing the provisions of the Inclusionary Development Covenant, see id. §

2204.1. The implementing regulations for the Inclusionary Development Covenant clearly state

that

          The Inclusionary Development Covenant . . . at a minimum, shall include: . . . (d)
          A provision providing for the release or extinguishment of the Inclusionary
          Development Covenant only upon the reasonable approval of the Department of
          Housing and Community Development Inclusionary Zoning Administrator.

Id. § 2204.1(d) (emphasis added). Article X of the specific Covenant at issue in this case

reiterates this authority: “[T]his Covenant may be released and extinguished upon the reasonable

approval of the District Agency.” Compl. Ex. A at 10. Defendants nevertheless contend that

DHCD does not have the authority to release or extinguish the Covenant because, pursuant to

title 14 section 2223.1 of the D.C. municipal regulations, DHCD may only waive provisions that

are “not required by the Zoning Commission’s Inclusionary Zoning Regulations or the

Inclusionary Zoning Act” and, as previously established, the Inclusionary Zoning Act requires a

covenant.

          The Court finds Defendants’ interpretation of the import of § 2223.1 misguided.

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Defendants’ reading of DHCD’s implementing regulations would create a sharp conflict within

the implementing regulations. Specifically, by reading § 2223.1(b) as precluding DHCD from

waiving the Inclusionary Development Covenant, § 2223.1 would be in direct conflict with §

2204.1(d) which explicitly grants DHCD the authority to “release or extinguish[]” the

Inclusionary Development Covenant “upon the reasonable approval of the Department of

Housing and Community Development Inclusionary Zoning Administrator.” The Court is not

inclined to assume that the Deputy Mayor for Planning and Economic Development, who

adopted the implementing regulations, intended to create such a conflict or even inadvertently

created so obvious of a conflict. The most logical reading of the implementing regulations and a

reading that avoids the conflict created by Defendants is that pursuant to § 2223.1, DHCD may

not waive the provision in the implementing regulations requiring the recordation of a covenant

before a building permit shall be issued, but that does not prevent DHCD from complying with

the separate provision requiring that the covenant be releasable or extinguishable upon the

reasonable approval of the DHCD Inclusionary Zoning Administrator. In other words, DHCD

cannot waive the provision in the implementing regulations requiring, as a blanket rule, that a

covenant be recorded, but DHCD can, in certain circumstances, release a developer from a

covenant at a later date.

       Defendants’ argument under § 2223.1 would be more appropriate if the Inclusionary

Zoning Act prohibited the release or extinguishment of the covenant and DHCD’s implementing

regulations contained a mirror provision. Then, Defendants could argue, as they have here, that

DHCD does not have the authority to waive the implementing regulations provision and release

the covenant because such a provision is required by the Act. However, Defendants have

pointed to no such prohibition in the Inclusionary Zoning Act or the Inclusionary Zoning

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Regulations, and the Court has found none.

       Accordingly, as the Court has again found that DHCD has the authority to “release or

extinguish” the covenant and Plaintiff asked DHCD to waive the covenant and DHCD refused,

the Court reaffirms its ruling that Plaintiff’s claims with respect to the covenant are ripe.

                                       III. CONCLUSION

       For the reasons outlined above, the Court DENIES Defendants’ Motion for

Reconsideration. As the Court held in its September 30, 2013, ruling, the Court lacks subject

matter jurisdiction over the Plaintiff’s challenge to the IZ Program writ large as that claim is not

ripe, but can consider the Plaintiff’s challenge to the Inclusionary Development Covenant

restricting the sale of the units in question. Accordingly, Plaintiff’s claims, as to all counts,

remain viable as to Plaintiff’s challenge to all aspects of the Inclusionary Development

Covenant. An appropriate Order accompanies this Memorandum Opinion.

                                                           /s/
                                                       COLLEEN KOLLAR-KOTELLY
                                                       UNITED STATES DISTRICT JUDGE

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