This article is reproduced from the Summit Daily News, June 9, 2009, by permission of author Noah Klug.
I read with interest a recent article in the Summit Daily News titled “Condo-Hotel Approval Triggers A Look At Zoning,” which discussed Summit County's approval of a new development on Tiger Road. We don't have a pony in the race about the development, but it struck me that the project was apparently approved because it complied with zoning adopted in 1969 despite concerns about how well that zoning meshes with today's community vision. Summit County's hands were likely not tied in the matter. When faced with potentially inadequate regulations, Summit County, like all local governments, has tools at its disposal to halt or slow growth until it adopts new growth-management programs, comprehensive plans, or zoning ordinances. One frequently used approach is imposition of a moratorium.
The leading Colorado case involved a businessman who purchased a shuttered historic theater in Central City prior to the 1991 constitutional amendment allowing limited-stakes gambling in that city. After the amendment was adopted, the landowner entered into a contract to sell the theater contingent upon the city's approval of a gambling permit, and he applied for the permit. The city then placed a moratorium on new development in the gaming district until studies were completed concerning the city's capacity to absorb growth spawned by gambling. As a direct result of the moratorium, the landowner's permit application was suspended and his pending sale fell through. Ten months later, the growth studies were completed and the city repealed the moratorium. The landowner then sued the city alleging that the moratorium constituted a taking of his property because it left him with no reasonable use of the theater during the 10-month period. The court held that it was permissible for a municipality to impose a moratorium if it was based on a good faith and reasonable effort to permit more effective governmental decision making. The court also held that there had been no “taking” of private property, and the owner was not entitled to any compensation.
The Central City case showed the power of local governments to impose moratoria under their police powers. In another case involving controversial proposed development of a large ranch between Aspen and Snowmass, the court held that Pitkin County had authority under a statute known as the Local Government Land Use Control Enabling Act to impose a temporary moratorium on land use application reviews while the county made changes to its master plan. Similar provisions likely could have been invoked concerning the development on Tiger Road.
Local governments do not have unlimited powers to impose moratoria. In a case from Colorado Springs, the city council, by resolution, approved a moratorium on adult bookstores pending further studies of the issue, and a bookstore operator sued. The court held that because ordinances are adopted by legislative process, they can only be changed by new ordinances adopted through legislative process. Thus, the city's moratorium by resolution was ineffective.
A case from Boulder went all the way to the United States Supreme Court, which held that it was a violation of federal antitrust law to adopt a moratorium on the expansion of cable television businesses in the city while the council drafted a new ordinance to regulate these businesses and invite new operators into the market.
So, when local governments are faced with regulations that are potentially inconsistent with community goals, they have the ability to call “time out” for a reasonable period of time to study and address the issues provided that they follow the correct procedures. That option was likely available in the Tiger Run case (as well as other options that the county may be pursuing).
Noah Klug is an attorney with the Breckenridge law firm of Bauer & Burns, P.C. He may be reached at 970-453-2734 or Noah@BreckenridgeLawyer.com.
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