Court Opinion

ID: 4159660
Source: CourtListenerOpinion
Date Created: 2017-04-12 12:16:05.873194+00
Date Added: 2024-06-11T07:46:17.874343
License: Public Domain

2017 WI 34

                  SUPREME COURT            OF     WISCONSIN
CASE NO.:               2014AP1914
COMPLETE TITLE:         McKee Family I, LLC and JD McCormick Company,
                        LLC,
                                   Plaintiffs-Appellants-Cross-
                                   Respondents-Petitioners,
                             v.
                        City of Fitchburg,
                                   Defendant-Respondent-Cross-Appellant.

                          REVIEW OF A DECISION OF THE COURT OF APPEALS
                           Reported at: 366 Wis. 2d 329, 873 N.W.2d 99

OPINION FILED:          April 12, 2017
SUBMITTED ON BRIEFS:
ORAL ARGUMENT:          November 3, 2016

SOURCE OF APPEAL:
   COURT:               Circuit
   COUNTY:              Dane
   JUDGE:               John C. Albert

JUSTICES:
   CONCURRED:
   DISSENTED:
   NOT PARTICIPATING:   Shirley S. Abrahamson and Rebecca Grassl
                        Bradley, JJ.

ATTORNEYS:

       For        the   plaintiff-appellant-cross-respondent-petitioners,
there were briefs by Matthew Fleming and Murphy Desmond, S.C.,
Madison, and oral argument by Matthew J. Fleming

       For the defendants-respondent-cross-appellant, there was a
brief by Lisa M. Lawless, Ross A. Anderson, Husch Blackwell,
LLP, Milwaukee and Mark R. Sewell, Fitchburg City Attorney, and
oral argument by Lisa M. Lawless

       An amicus curiae brief was filed by Thomas Larson, Madison
for    Wisconsin        Realtors   Association,   NAIOP   Wisconsin   and   the
Wisconsin Builders Association.
    An amicus curiae brief was filed by Ryan J. Walsh, Chief
Deputy Solicitor General with whom on the brief was Brad D.
Schimel, Attorney General and Misha Tseytlin, Solicitor General
for Wisconsin Attorney General and Department of Justice.

    An   amicus   curiae   brief   was   filed   by   Daniel   M.   Olson,
Madison for League of Wisconsin Municipalities.

                                   2
                                                                         2017 WI 34
                                                                 NOTICE
                                                   This opinion is subject to further
                                                   editing and modification.   The final
                                                   version will appear in the bound
                                                   volume of the official reports.
No.    2014AP1914
(L.C. No.     2010CV3808)

STATE OF WISCONSIN                             :            IN SUPREME COURT

McKee Family I, LLC and JD McCormick Company,
LLC,

              Plaintiffs-Appellants-Cross-                            FILED
              Respondents-Petitioners,
                                                                 APR 12, 2017
       v.
                                                                    Diane M. Fremgen
City of Fitchburg,                                               Clerk of Supreme Court

              Defendant-Respondent-Cross-Appellant.

       REVIEW of a decision of the Court of Appeals.                Affirmed.

       ¶1     ANN WALSH BRADLEY, J.          Petitioner, McKee Family I,

LLC ("McKee") appeals an unpublished decision of the court of
appeals affirming a circuit court grant of summary judgment in

favor of the City of Fitchburg.1           The court of appeals determined

that       McKee   did   not   have   a   vested    right     under      a   planned

       1
       McKee Family I, LLC v. City of Fitchburg, No. 2014AP1914,
unpublished slip op. (Wis. Ct. App. Nov. 5, 2015) (affirming
judgment and ordered entered by the circuit court for Dane
County, John C. Albert, J., presiding).
                                                                               No.    2014AP1914

development           district        zoning    classification            and        that     its

constitutional claim failed as a result.

       ¶2       McKee contends that the court of appeals erred and

that       it    is        entitled    to    summary        judgment      in    its     favor.

Acknowledging the fact that it did not submit an application for

a building permit, it nevertheless argues that it had a vested

right in developing land under the zoning classification.

       ¶3       According        to    McKee,       vested       rights   accrue       when    a

developer         has        made     substantial          expenditures        or     incurred

substantial            liability       based        upon     reasonable         expectations

established           by    government      action.         It    contends     that    to     the

extent that the zoning classification is contractual in nature

it also creates expectations upon which developers may rely.

Contingent on its vested rights arguments, McKee further asserts

that it has a claim for damages under the Takings Clause of the

United States Constitution.2

       ¶4       We conclude that McKee did not have a vested right in

developing the property under the planned development district
zoning classification because it did not apply for a building

permit.         Wisconsin follows the bright-line building permit rule

that a property owner's rights do not vest until the developer

has submitted an application for a building permit that conforms

       2
       The Takings Clause of the Fifth Amendment of the United
States Constitution, made applicable to the states through the
Fourteenth Amendment, provides that private property shall not
"be taken for public use, without just compensation."     U.S.
Const. amend V.

                                                2
                                                                             No.    2014AP1914

to the zoning or building code requirements in effect at the

time of application.               Lake Bluff Hous. Partners v. City of S.

Milwaukee, 197 Wis. 2d 157, 172, 540 N.W.2d 189 (1995).

      ¶5     Additionally, we determine that a planned development

district       zoning    classification              does    not    create       contractual

expectations upon which developers may rely.                             There is a very

strong     presumption        that     legislative          enactments     do    not    create

contractual or vested rights.                   Dunn v. Milwaukee Cty., 2005 WI

App 27, ¶8, 279 Wis. 2d 370, 693 N.W.2d 82 (citation omitted).

Further, there must be a clear indication that a legislative

body intends to bind itself contractually in order to overcome

the   presumption.            Nat'l      R.R.       Passenger      Corp.    v.     Atchinson,

Topeka and Santa Fe Ry. Co., 470 U.S. 451, 465-66 (1985).                                McKee

failed to overcome the presumption that Fitchburg did not intend

to enter into a binding contract when it enacted an ordinance

approving the zoning classification.

      ¶6     Finally,         we       do      not      need       to      reach       McKee's

constitutional       takings           claim    because        McKee     conditioned       its
takings claim on its claim for vested rights.                           Because McKee has

no    vested     right       in    a    planned       development        district      zoning

classification,         it    cannot     succeed       on    its    asserted       contingent

takings claim.

      ¶7     Accordingly, we affirm the decision of the court of

appeals affirming the circuit court's grant of summary judgment

in favor of the City of Fitchburg.

                                                3
                                                                No.    2014AP1914

                                          I

     ¶8     This case involves a dispute about a change in the

municipal zoning classification of property that McKee owns in

Fitchburg.     Specifically, McKee objects to Fitchburg's rezoning

of two lots (53 and 54) from a planned development district

("PDD") zoning classification to a residential-medium ("R-M")

zoning classification.        To provide the necessary context, we

begin by explaining Fitchburg's process for adopting a zoning

classification.

     ¶9     Pursuant    to         Wis.       Stat.   § 62.23         (2013-14),

municipalities may use a PDD zoning classification to establish

planned mixed-use developments that have a higher density than

is   allowed   under   an    R-M    classification.3      The    R-M      zoning

     3
         Wis. Stat. § 62.23(7)(b) provides in relevant part:

     [T]he council may divide the city into districts of
     such number, shape, and area as may be deemed best
     suited to carry out the purposes of this section; and
     within such districts it may regulate and restrict the
     erection, construction, reconstruction, alteration or
     use of buildings, structures or land . . . The counsel
     may establish mixed-use districts that contain any
     combination of uses, such as industrial, commercial,
     public, or residential uses, in a compact urban form.
     The council may with the consent of the owners
     establish special districts, to be called planned
     development districts, with regulations in each,
     which . . . will over a period of time tend to promote
     the maximum benefit form coordinated area site
     planning, diversified location of structures and mixed
     compatible uses. . . .

All subsequent references to the Wisconsin Statutes are to
the 2013-14 version unless otherwise indicated.

                                          4
                                                                         No.     2014AP1914

classification          allows    development         of   only    single-family          or

duplex structures.

       ¶10       Before a property owner can develop land that is zoned

under      the    PDD   classification,           Fitchburg's     General    Ordinances

require the property owner to submit a general implementation

plan ("GIP") to Fitchburg's Plan Commission.                        Fitchburg, Wis.,

Gen. Ordinances §§ 22-593, 22-594 (2015).4                      The Plan Commission

then makes a determination and recommendation whether to advise

the Fitchburg Common Council to approve the rezoning and GIP, to

approve it with modifications, or to deny it.                     Id. § 22-594(b).

       ¶11       If Fitchburg approves a general plan, a property owner

is   then        required   to    submit      a    specific     implementation        plan

("SIP").         Id. § 22-599.         A property owner is allowed to apply

for a building permit if Fitchburg approves the SIP.                             Id. § 22-

597.

       ¶12       The relevant zoning history of this case extends back

to   1989,       when   McKee    Brothers     Partnership       agreed      to    dedicate

approximately 60 acres of farmland to the City of Fitchburg.
This farmland, which became McKee Farms Park, was donated to

fulfill      Fitchburg's        park   land       dedication    requirements        for    a

variety of McKee Brothers' projects, including the property at

issue in this case.               Credit for the parkland allocation was

determined by a settlement agreement, which gave McKee Brothers

       4
       The references to the Fitchburg General Ordinances                                 in
paragraph 11 are also to the 2015 version of the ordinances.

                                              5
                                                                              No.   2014AP1914

the right to build 600 dwelling units on a variety of lands it

owned.

       ¶13       Over    the     years,    the       property    at     issue       has    been

transferred between various McKee entities.                           After the parkland

dedication,           McKee     Brothers       transferred      the    property       to    MAF

Development, Inc., to create the Plat of Chapel Valley.5                                    The

plat included four lots, the two undeveloped lots at issue (53

and 54), as well as two additional lots that have already been

developed (10 and 11).

       ¶14       In conjunction with the creation of the Plat of Chapel

Valley, MAF Development entered into an agreement with Fitchburg

that it would make improvements in preparation for developing

its land.         The required improvements included:                    standard street

improvements, installation of sidewalks, walkways and driveways,

sanitary sewers, water mains laterals and easements, drainage

facilities,           grading     and     landscaping,       erosion         control,       and

electric, communications and gas facilities.

       ¶15       At the time the plat was created, it had an R-M zoning
classification,           but    MAF    Development      applied       for    and    received

approval for rezoning to a PDD classification.                               When Fitchburg

enacted Ordinance No. 94-O-11 rezoning Lots 10, 11, 53, and 54

from       R-M   to     PDD   zoning,     it    also   approved       MAF     Development's

general implementation plan for developing the property.

       5
           William F. McKee was the president of MAF Development.

                                                 6
                                                                          No.    2014AP1914

     ¶16     As     the     general      plan       explained,           the     proposed

development       would   provide     "high     quality         multi-family      housing

that is in strong demand" for "mature adults."                      Citing the "lack

of housing options for mature adults in the Fitchburg area," the

proposed development was intended to complement the "Independent

Living" and "Elder Care" developments nearby.                      The GIP explained

that the "formation of such a 'senior community' will serve the

community by making the most efficient use of public and private

services these people will require."

     ¶17     Lots 10 and 11, which are not at issue in this case,

were developed between 1995 and 2002 under the PDD-GIP zoning

plan with assisted living facilities, senior housing and senior

condominiums.        Lots    53   and    54     were      not    developed       and   were

eventually deeded from MAF Development to McKee in 2007.

     ¶18     In 2008, more than a decade after Fitchburg approved

the planned development district zoning and MAF Development's

general implementation plan, McKee and JD McCormick Company, LLC

("McCormick"),       entered      into     negotiations           for    McCormick        to
purchase     the   undeveloped      lots       53   and    54     from    McKee.         The

purchase     agreement      was   contingent        on    McCormick's          ability   to

obtain approval from Fitchburg to build 128 apartment units on

the lots.6

     6
       McCormick was a plaintiff in this action before the
circuit court granted Fitchburg's motion to dismiss McCormick
from the case for lack of standing.   McCormick did not appeal
the order dismissing it from the case and McKee did not raise
the issue on appeal.

                                           7
                                                                      No.       2014AP1914

       ¶19    McCormick presented a plan for a 128-unit apartment

complex on Lots 53 and 54 at a Fitchburg neighborhood meeting.

Fitchburg residents expressed concern about the effect of the

proposed development on traffic, crime and housing values.                            The

neighborhood's objections were set forth in a petition signed by

600 Fitchburg residents detailing concerns about the scale and

density of the proposed development:

       If a rental development of this scale and density were
       built . . . it would result in significant increases
       in and unacceptable levels of traffic, noise, litter,
       vandalism,    storm   water    run-off,   and    would
       significantly impact the quality of life and the
       property values of those already residing in our
       neighborhoods.
In    particular,        Fitchburg    residents      were    concerned       that     the

proposed development did not comport with the original PDD-GIP

plan to develop senior housing.

       ¶20    Despite these objections, McCormick prepared a PDD-SIP

application for the 128-unit apartment complex on lots 53 and

54.    The proposed development consisted of four three-story 32-

unit apartment buildings, with a clubhouse and a pool.                          It hired

an architect, engineer, and landscape architect, but there is no

evidence in the record regarding the costs McCormick incurred.

       ¶21    After      McCormick     submitted     the     specific       plan,     two

Fitchburg         Common     Council       members     submitted        a       rezoning

application and draft ordinance to rezone lots 53 and 54 from

PDD-GIP      to   R-M.      McKee    and   McCormick       then   filed     a    revised

application for PDD-SIP approval.               Following a public hearing,

                                            8
                                                                            No.   2014AP1914

Fitchburg        adopted        Ordinance      2009-O-03,       which       rezoned     the

property from PDD-GIP to R-M.

      ¶22    Under     the      R-M     zoning     classification,         McCormick    was

limited to developing 28 dwelling units, compared to a maximum

of   132    dwelling       units      under    the    PDD    zoning    classification.

McKee      and    McCormick        filed       a    lawsuit    seeking       declaratory

judgment, damages and injunctive relief on the grounds that the

rezoning of the lots was unlawful.

      ¶23    The amended complaint asserted two claims.                           First, it

alleged that Ordinance 2009-O-03 is void as a matter of law

because it was adopted by Fitchburg without the consent of the

owner of the property, contrary to Wis. Stat. § 62.23(7)(b).

Second,     it     alleged       that     if       Fitchburg   "wrongfully          adopted

Ordinance        2009-O-03,       and    wrongfully        refused    to    process     and

approve the PDD-SIP application," then McKee was deprived of the

full economic use of the property and from earning a reasonable

return on its respective investment.                    McKee further alleged that

it   was    deprived       of    substantive         and    procedural      due     process
guarantees in violation of the Fifth and Fourteenth Amendments

of the United States Constitution, and Article I, Section 13 of

the Wisconsin Constitution.

      ¶24    The parties filed cross-motions for summary judgment.

At issue here is the circuit court's grant of summary judgment

in favor of Fitchburg.                On summary judgment, the circuit court

dismissed McKee's first claim, determining that Lots 53 and 54

were rezoned in accordance with Wis. Stat. § 62.23(7)(b) and the
relevant local ordinances.                    The circuit court did not reach
                                               9
                                                                                    No.    2014AP1914

McKee's constitutional takings claim because it was conditioned

on the dismissed first claim.

       ¶25       McKee appealed the circuit court's summary judgment

order.           On    appeal,       however,        McKee      did    not    argue        that    the

rezoning ordinance was void under Wis. Stat. § 62.23(7)(b) for

lack of consent.               Instead, McKee asserted that it had a vested

right       in        the     PDD     zoning         classification,            that       the     PDD

classification              created        a      contract        that       gives         rise     to

expectations on which developers may rely, and that the rezoning

ordinance constituted a taking under the Fifth Amendment to the

United States Constitution.

       ¶26       The court of appeals determined that McKee did not

have    a    vested         right     in    the      PDD      zoning    classification            when

Fitchburg rezoned the lots.                         McKee Family I, LLC v. City of

Fitchburg, No. 2014AP1914, unpublished slip op., ¶32 (Wis. Ct.

App.     Nov.         5,     2015).            It     declined         to    address        McKee's

constitutional              taking    argument,            concluding        that     it    was     an

undeveloped argument.                Id., ¶32 n.6.
                                                    II

       ¶27       In    this    case    we      are    asked     to     review       the    court    of

appeals decision affirming the circuit court's grant of summary

judgment         in    favor    of    the      City      of    Fitchburg.           We     review   a

decision         granting           summary         judgment      independently             of     the

determinations rendered by the circuit court and the court of

appeals.         Lambrecht v. Estate of Kaczmarczyk, 2001 WI 25, ¶21,

241 Wis. 2d 804,            623 N.W.2d 751.                Summary       judgment        is
appropriate when there is no genuine issue as to any material
                                                    10
                                                                        No.   2014AP1914

fact and a party is entitled to judgment as a matter of law.

Id., ¶24.

    ¶28     At issue is whether McKee has a vested right in the

zoning    classification       and   whether        the    classification       creates

contractual      expectations        upon        which    McKee   may      rely.     We

additionally address whether a constitutional takings claim can

be maintained.      These issues present questions of law that this

court reviews independently of the determinations rendered by

the circuit court and the court of appeals.                       Zealy v. City of

Waukesha, 201 Wis. 2d 365, 372, 548 N.W.2d 528 (1996).

                                        III

    ¶29     We    must   address      first       whether    McKee    forfeited     the

arguments it raised for the first time on appeal.                             Fitchburg

contends that McKee did not appeal the claims dismissed by the

circuit   court    on    summary     judgment.            According   to    Fitchburg,

McKee forfeited the arguments it now advances because they were

raised for the first time on appeal.

    ¶30     Although     the   circuit       court       dismissed    McKee's      claim
that Ordinance 2009-O-03 was void for lack of consent, it did

not appeal that issue.         Instead, on appeal McKee asserts that it

has a vested right in developing lots 53 and 54 under the PDD

zoning classification due to expenditures incurred based upon

reasonable expectations established by government action.                          McKee

further asserts that to the extent the zoning classification is

contractual in nature, it also creates expectations upon which

developers may rely.

                                            11
                                                                                     No.    2014AP1914

      ¶31      Contingent         on    its     vested          rights     arguments,          McKee

contends       that    it   has     a   claim        for    damages       under       the    Takings

Clause of the United States Constitution.

      ¶32      Generally,       issues         not    raised       or     considered         by    the

circuit     court      will    not      be    considered          for    the     first      time    on

appeal.        State v. Holland Plastics Co., 111 Wis. 2d 497, 504,

311 N.W.2d 320        (1983).          However,          it     is    within       this    court's

discretion       to     "disregard           alleged        forfeiture          or    waiver       and

consider the merits of any issue because the rules of forfeiture

and waiver are rules of 'administration and not of power.'"

State     v.    Beamon,        2013 WI 47,        ¶49,    347 Wis. 2d 559,            830
N.W.2d 681.           The arguments raised on appeal have been briefed

and argued by both parties.                     Accordingly, we choose to address

McKee's     arguments         set      forth    above        in    order       to    clarify       the

important issues of law that are presented in this case.

                                                IV

      ¶33      The primary issue before this court is whether McKee

had   a   vested       right      in    the    PDD     zoning          classification         before
Fitchburg rezoned the land to the R-M zoning classification.

Despite the fact that it was not eligible for, and did not apply

for a building permit, McKee asserts that it had a vested right

in the PDD zoning classification.

      ¶34      McKee    contends         that    this        court       should      depart       from

Wisconsin's       bright-line            building          permit        rule       and     evaluate

whether a developer has vested rights on a case-by-case basis.

It argues that Fitchburg should not have had the discretion to
change zoning regulations before a building permit was approved
                                                12
                                                                         No.   2014AP1914

because     McKee   had     already     made      substantial        expenditures      in

preparation for development under the PDD-GIP zoning.

      ¶35    We begin with the basic premise that municipalities

have broad discretion to enact zoning ordinances and land use

regulations for a variety of purposes:

      For the purpose of promoting health, safety, morals or
      the general welfare of the community, the council may
      regulate and restrict by ordinance . . . the height,
      number of stories and size of buildings and other
      structures, the percentage of lot that may be
      occupied, the size of yards, courts and other open
      spaces . . . the  density   of  population,   and  the
      location and use of buildings, structures and land for
      trade, industry, mining, residence or other purposes
      if there is no discrimination against temporary
      structures.
Wis. Stat. § 62.23(7)(am).              Any ordinance adopted under this

section "shall be liberally construed in favor of the city."

Id.

      ¶36    Additionally,         "reliance        on     a     particular         zoning

designation      applicable       to   [a   landowner's]         property      does   not

suffice     to    give      the    landowner       a     vested      right     to     such
designation."       Rainbow Springs Golf Co. v. Town of Mukwonago,

2005 WI App. 163, ¶12, 284 Wis. 2d 519, 702 N.W.2d 40 (citing

Zealy, 201 Wis. 2d at 381).             A "vested right" is a "right that

so completely and definitely belongs to a person that it cannot

be impaired or taken away without the person's consent."                            Stoker

v.    Milwaukee     Cty.,     2014 WI 130,    ¶24,       359 Wis. 2d 347,      857
N.W.2d 102       (quoting    Black's        Law    Dictionary        1520    (10th     ed.

2014)).

                                            13
                                                                                 No.   2014AP1914

       ¶37   The exception to the rule that zoning does not create

vested rights arises when a property owner has applied for a

building       permit          conforming           to       the      original            zoning

classification.          See Lake Bluff, 197 Wis. 2d at 182.                            In Lake

Bluff,    this     court      concluded      that      the      developer        "obtained     no

vested rights, because it never submitted an application for a

building     permit      conforming       to    the       zoning     and     building        code

requirements in effect at the time of the application."                                Id.

       ¶38   Lake       Bluff     explained              that      "[o]ur        cases       have

consistently held that no rights vest in such an instance" when

a building permit has not been obtained.                         Id.; see also State ex

rel. Humble Oil & Ref. Co. v. Wahner, 25 Wis. 2d 1, 13, 130
N.W.2d 304 (1964); Vil. of Hobart v. Brown Cty., 2005 WI 78,

¶28,   281 Wis. 2d 628,         698 N.W.2d 83.              Therefore,        Lake    Bluff

reasoned     that       the    developer        "did      not      possess       the    'clear,

specific legal right which is free from substantial doubt' that

is   required      in    an    action     for     mandamus."              Lake    Bluff, 197
Wis. 2d at 182 (quoting Collins v. Am. Family Mut. Ins. Co., 153
Wis. 2d 477, 483, 451 N.W.2d 429 (1990)).

       ¶39   McKee argues first that Lake Bluff's building permit

rule should be limited to the facts of that case because the

developer in Lake Bluff requested relief in the form of a writ

of   mandamus.          According       to     McKee,        Lake    Bluff       declined      to

consider the developer's substantial expenditures in determining

whether it had vested rights because a writ of mandamus requires

"strict      and    complete       compliance             with      all     necessary         and
applicable provisions of the relevant ordinance . . ."                                    Id. at
                                             14
                                                            No.   2014AP1914

174 (quoting 4 Edward H. Ziegler, Jr., Rathkopf's The Law of

Zoning and Planning, § 44.04[1], at 44-14 to 44-15 (4th ed. 1956

& Supp. 1994) (footnotes omitted)).          Thus, McKee asserts that

because it brought claims for declaratory judgment and damages

arising from alleged constitutional violations, the permit rule

should not be applied here given that the requested remedies are

distinguishable    from    the   relief   requested    in   the   writ   of

mandamus in Lake Bluff.

       ¶40   We decline McKee's invitation to limit Lake Bluff to

cases in which a developer seeks relief in the form of a writ of

mandamus.     The Lake Bluff court did not base its decision on the

developer's requested remedy.       Instead, it reasoned that "[f]rom

the very beginning of zoning jurisprudence in this state [] a

building permit has been a central factor in determining when a

builder's rights have vested."      Id. at 172.

       ¶41   Indeed, Lake Bluff considered prior Wisconsin case law

on this issue in reaching its decision and explained that "a

common factor . . . was the presence or absence of a building
permit."     Id. at 172.   As Lake Bluff explained, Building Height

Cases examined three separate cases and ruled on the nature of

the vested rights, if any, in each case.              Id. at 171 (citing

State ex rel. Klefisch v. Wisconsin Tel. Co. (Building Height

Cases), 181 Wis. 519, 195 N.W. 544 (1923)).           In two of the cases

it examined whether there were vested rights when the developer

obtained a permit. However, in the third case where there was no

application for a permit, there were no vested rights.              Id. at
172.
                                    15
                                                                          No.   2014AP1914

       ¶42   Underlying the vested rights doctrine is the theory

that a developer is proceeding on the basis of a reasonable

expectation.      Id. at 175 (citing State ex rel. Cities Serv. Oil

Co. v. Bd. of Appeals, 21 Wis. 2d 516, 528-29, 124 N.W.2d 809

(1963); 8 McQuillin Mun. Corp. § 25:157 at 701 (3d ed. 1991).

As   Lake    Bluff   explained,        "[r]equiring       an    application       for   a

building permit which conforms to applicable zoning or building

code requirements in order to show a clear legal right also

serves the goals of the vested rights doctrine." 197 Wis. 2d at

175.

       ¶43   Wisconsin applies the bright-line building permit rule

because it creates predictability for land owners, purchasers,

developers, municipalities and the courts.                      See, e.g., Guertin

v. Harbour Assurance Co. of Bermuda, 141 Wis. 2d 622, 634-35,

415 N.W.2d 813 (1987) (explaining that bright line rules provide

predictability       and     protect     all     parties).           It    balances     a

municipality's need to regulate land use with a land owner's

interest     in   developing      property        under        an    existing     zoning
classification.       A municipality has the flexibility to regulate

land use through zoning up until the point when a developer

obtains a building permit.               Once a building permit has been

obtained, a developer may make expenditures in reliance on a

zoning classification.

       ¶44   In contrast, the rule proposed by McKee, which would

require a case-by-case analysis of expenditures, would create

uncertainty at the various stages of the development process.
Nevertheless,        McKee     urges      this     court        to     follow      other
                                         16
                                                                       No.   2014AP1914

jurisdictions,    which     it     contends      recognize     expenditures         made

after a municipality approved the development of plats of land.

See, e.g., Telimar Homes, Inc. v. Miller, 14 A.D.2d 586, 587

(1976); Milcrest Corp. v. Clackamas Cty., 650 P.2d 963, 967

(1982).     According     to     McKee,   "the      concept    of    fair    play   and

protection of settled expectations demands a more flexible and

searching inquiry than bright-line rules such as the building

permit test can provide."

     ¶45    For the reasons set forth above, we decline to adopt

this approach.        Additionally, we observe that even if this court

were to determine that a rule based on substantial expenditures

should apply here, McKee's claim would fail because it has not

introduced evidence supporting its claims.

     ¶46    We previously addressed the two-fold impediments of

failure to apply for a building permit along with the failure to

present evidence in support of the claim.                     In Zealy, the court

determined that the developer did not have a vested right to the

former residential zoning on his land. 201 Wis. 2d at 381-82.
It   reasoned    that     "Zealy    has       not    shown    that     he    made   any

expenditures     in     reliance    on    the       zoning,    nor     has    he    ever

submitted   an   application        for   a    building       permit    proposing     a

residential use of the land."              Id.      McKee's claim suffers from

the same lack of evidence of expenditures made in reliance on

the PDD zoning as well as the failure to submit an application

for a building permit.

     ¶47    In sum, we decline to depart from Wisconsin's bright-
line building permit rule.               A property owner's rights do not
                                          17
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vest until the developer has submitted an application for a

building permit that conforms to the zoning or building code

requirements in effect at the time of application.                       Lake Bluff,
197 Wis. 2d at 182.           It is undisputed that McKee did not apply

for a building permit.           Like the court of appeals, we conclude

that    McKee    did    not   have   a    vested    right   in    developing           the

property under the PDD zoning classification because it did not

apply for a building permit.

                                          V

       ¶48    We turn next to McKee's argument that to the extent

the    zoning    classification      is    contractual      in    nature       it     also

creates expectations upon which developers may rely.

       ¶49    McKee bases this assertion on the City of Fitchburg

Ordinances that set forth the procedures for the PDD zoning

process that were in effect at the time the PDD-GIP was adopted.

Specifically, McKee relies on language in the Ordinances that

referred to a PDD zoning classification as "an agreement [that]

is     reached   between      the    property       owner   and     the        City     of
Fitchburg."            Fitchburg,    Wis.,     Gen.     Ordinances         §     22.82.

Additionally, McKee contends that section 22.91, which stated

that "[t]he City Council shall approve a Specific Implementation

Plan that is reasonably consistent with the previously approved

General      Implementation     Plan,"    is   an    expression     of     intent       to

create expectations upon which developers are expected to rely.

Fitchburg, Wis., Gen. Ordinances § 22.91.

       ¶50    According to McKee, we should interpret the language
of the Fitchburg Ordinances as expressing an intention to create
                                          18
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expectations upon which developers are entitled to rely.                             Thus,

McKee    asserts    that       we    should    decline      to   apply   the      building

permit    rule,    because       it   contends       that    a   planned    development

district is a form of negotiated zoning that a developer may

rely upon once it is adopted by Fitchburg.

    ¶51     McKee's           argument        here    contravenes          the      strong

presumption        that       legislative          enactments      do      not      create

contractual rights.            Dunn, 279 Wis. 2d 370, ¶8 (citing Morrison

v. Bd. of Educ. of City of W. Allis, 237 Wis. 483, 487-88, 297
N.W. 383 (1941)).          Treating legislative acts as contracts would

"enormously       curtail      the    operation      of     democratic     government."

Id., ¶9 (quoting Pittman v. Chicago Bd. of Educ., 64 F.3d 1098,

1104 (7th Cir. 1995)).

    ¶52     It     is     a     well-established            principle      that     "[o]ne

legislature may not bind a future legislature's flexibility to

address changing needs."              Flynn v. Dep't of Admin., 216 Wis. 2d
521, 543, 576 N.W.2d 245 (1998).                     Accordingly, a current city

government "may not enact a statute which has 'implications of
control    over     the     final     deliberations         or   actions     of     future

legislatures.'"         Id.

    ¶53     The facts of this case demonstrate why a legislative

body must have the flexibility to adopt and repeal legislation

in response to its community's changing needs.                          Lots 53 and 54

were undeveloped for fifteen years after Fitchburg approved the

PDD-GIP, yet McKee asserts that the current Fitchburg Common

Council is contractually bound by a city ordinance adopted in
1994.
                                              19
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       ¶54    The original GIP proposed a development for "mature

adults," citing the "lack of housing options for mature adults

in   the     Fitchburg   area."   It   was   intended    to   compliment      the

"Independent Living" and "Elder Care" developments nearby.                    The

GIP explained that the "formation of such a 'senior community'

will serve the community well by making the most efficient use

of public and private services these people will require."

       ¶55    Lots 10 and 11, which are not at issue in this case,

were developed between 1995 and 2002 under the PDD zoning plan

with    assisted    living   facilities,     senior     housing    and    senior

condominiums.       In 2008, more than a decade after the PDD-GIP

zoning was approved, McCormick presented a plan for a 128-unit

apartment complex on lots 53 and 54 at a Fitchburg neighborhood

meeting.       The development proposed in 2008 consisted of four

three-story 32-unit apartment buildings, with a clubhouse and a

pool.

       ¶56    In a petition signed by 600 Fitchburg residents, the

neighborhood detailed its concerns about the scale and density
of the proposed development:

       If a rental development of this scale and density were
       built . . . it would result in significant increases
       in and unacceptable levels of traffic, noise, litter,
       vandalism,    storm   water    run-off,   and    would
       significantly impact the quality of life and the
       property values of those already residing in our
       neighborhoods.
The primary focus of concern was that the proposed development

did not comport with the original PDD-GIP plan to develop senior
housing.

                                       20
                                                                               No.    2014AP1914

       ¶57   The    concerns      of    Fitchburg's          citizens         in     this    case

demonstrate why the legislature must have flexibility to address

the changing needs of the community.                       See Flynn, 216 Wis. 2d at

543.     Although Fitchburg adopted the PDD-GIP in 1994, it needed

to be able to respond to the changing development needs of the

community in 2008.

       ¶58   Not only was the development far different than what

was originally proposed, McCormick would have been the fourth

owner of the property since McKee Brothers Partnership dedicated

parkland     to    Fitchburg      in    1989.         Subsequent         to    the      parkland

dedication, the property was transferred to MAF, which in 1994

applied      for    and     received        approval       for    rezoning         to    a    PDD

classification.           Eventually, MAF deeded lots 53 and 54 to McKee,

which now argues that the potential purchaser, McCormick, has

the same zoning right granted to MAF in 1994 and reliance rights

arising from the parkland dedication in 1989.

       ¶59   As    the     United      States      Supreme       Court    has      explained,

there    must      be    "some    clear      indication          that    the       legislature
intends to bind itself contractually" in order to overcome the

presumption        that    a   law     is    not      intended     to     create        private

contractual rights.              Nat'l R.R. Passenger Corp., 470 U.S. at

465-66    (1985).         McKee     points       to   no   evidence       other       than    the

language     of    the     ordinances       in     setting    forth      the       development

process as support for its argument that PDD zoning created a

contract upon which it was entitled to rely.                        Accordingly, McKee

failed to overcome the presumption that Fitchburg did not intend

                                              21
                                                                            No.    2014AP1914

to    enter    into   a     binding     contract       when    it    enacted       the    1994

Ordinance approving the PDD zoning classification.

       ¶60    Finally, we observe that we need not consider McKee's

argument      that    the   rezoning     of     Lots    53    and    54    constituted      a

taking.

       ¶61    McKee brought its takings claim as contingent on its

claim for vested rights, contending it had a takings claim only

if this court determined that it had a vested right in the PDD

zoning classification.               In its amended complaint, McKee alleged

that    it    suffered      a   taking     in    violation          of    the     Fifth   and

Fourteenth Amendments "in the event that the Court finds that

the    Defendant       wrongfully        adopted       Ordinance          2009-O-03,       and

wrongfully       refused        to     process     and        approve       the      PDD-SIP

application . . ."           Likewise, in its opening brief McKee argues

that    "[f]inding        vested      rights     will    revive          McKee's     takings

claim."       Finally, at oral argument, McKee reiterated "you cannot

have a taking without a vested right."

       ¶62    As asserted, McKee's takings claim is contingent on
the success of his vested rights claim.                        Having failed on his

vested rights claim, his takings claim does not survive.

                                           VI

       ¶63    We conclude that McKee did not have a vested right in

developing the property under the planned development district

zoning classification because it did not apply for a building

permit.       Wisconsin follows the bright-line building permit rule

that a property owner's rights do not vest until the developer
has submitted an application for a building permit that conforms
                                           22
                                                                           No.    2014AP1914

to the zoning or building code requirements in effect at the

time of application.               Lake Bluff, 197 Wis. 2d at 182.                     It is

undisputed that McKee did not apply for a building permit.

      ¶64     Additionally, we determine that a planned development

district      zoning     classification           does    not     create     contractual

expectations upon which developers may rely.                          There is a very

strong   presumption       that      legislative         enactments     do   not       create

contractual      or    vested       rights.         Dunn,       279 Wis. 2d 370,        ¶8

(citation omitted).           Further, there must be a clear indication

that a legislative body intends to bind itself contractually in

order to overcome the presumption.                  Nat'l R.R. Passenger Corp.,
470 U.S. at 465-66.           McKee has not overcome the presumption that

Fitchburg did not intend to enter into a binding contract when

it enacted an ordinance approving the zoning classification.

      ¶65     Finally,        we     do     not      need       to      reach         McKee's

constitutional        takings       claim     because       McKee      conditioned       its

takings claim on its claim for vested rights.                         Because McKee has

no   vested    right     in    a    PDD   zoning     classification,             it   cannot
succeed on its asserted contingent takings claim.

      ¶66     Accordingly, we affirm the decision of the court of

appeals affirming the circuit court's grant of summary judgment

in favor of the City of Fitchburg.

      ¶67     SHIRLEY S. ABRAHAMSON and REBECCA GRASSL BRADLEY, JJ.,

did not participate.

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