Ruddertowne: After the Vote

To Our Friends And Neighbors In Dewey Beach

By CPD (Citizens to Preserve Dewey) | Published: February 28, 2011

We are sad to report that our Town Council voted in favor of the Mutual Agreement, with four Commissioners supporting its passage. Only Mayor Diane Hanson voted against the proposal, citing the overwhelming input from the citizens of Dewey Beach as the primary factor in her vote. We understand that a last minute decision by our town’s insurance carrier to limit coverage for the litigation contributed to the decision made by our Town Council. However, we are very disappointed in Jim Laird, who we supported and worked so hard for, and who hardly had time to talk to the citizens who elected him in the last five months as he worked on this deal. And the mystery to us is why Marty Seitz, who has been so staunchly in support of 35 feet, voted in favor of the agreement. He gave Jim Laird political cover to vote against us. We are stunned at his reversal.

We hope that you will all let Diane Hanson know how much you appreciate her vote. The person who was sued the most, who was at “ground zero” in this fight, was — in the end — the only person who supported the majority of property owners in Dewey Beach. She not only stood up for the citizens of our town, but also stood by her campaign promise to defend 35 feet.

We thank everyone who attended the meeting, who wrote letters to our Commissioners, and who gave of their time and funds to help defend our town’s 35’ height limit. We can all be proud of our attempts to preserve and protect our town. The presentations and comments today by CPD friends and neighbors were so outstanding and impressive — about the architectural aspects, legal aspects, economic aspects, RAC history and other components of the plan. We were gratified by the number of people who turned out in the middle of winter. Of course, DBE had a number of supporters as well, some of them employees of DBE, but not all.
We were also able to raise enough money to have an attorney present to prepare an excellent critique of the town’s legal position; and he raised a number of compelling arguments that, at least, made the commissioners pause. Among the arguments he presented was the fact that what the commissioners did in approving this huge zoning change for this one property owner is illegal. Thank you to all of you who contributed to CPD having an attorney to present the law to the Council.

We also presented Requests for Referendum from over 330 property owners — more than the 300 required for an official referendum. Today, however, the Council chose to grant exceptions from our zoning code to DBE by Settlement Agreement, rather than by ordinance. Had an ordinance been passed, the town charter would have given us the Right to Referendum if we gathered 300 signatures. DBE and the Town Council managed to maneuver around two different Rights to Referendum; and, only if we challenge them in court, will those rights be available.

At the moment, we are weary, disappointed, and disillusioned. However, we can be thankful for our accomplishments over the last 3-1/2 years. We succeeded in passing Ordinance 682, which will make it difficult for any other developer to exceed our 35’ height limit; we secured a no-gambling covenant on this property; and we reduced the height of this project from the original 68 feet to the current compromised height of 45.67 feet. We can only hope that this deal is solid and that it will give the town protection from the other property owners who are waiting in the wings to sue the town now that DBE’s litigation and intimidation strategy has succeeded. We have to evaluate what options we have going forward, limited though they may be.
We’d like to hear your thoughts.

As a final note — the most rewarding part of these last few years has been the many friends we have made in Dewey Beach.

We thank you all for your support.

Linda Winton, Anne Duffin, Joan Claybrook, Marcia Schieck, Joy Howell and Rick Judge
Citizens To Preserve Dewey

Ruddertowne compromise approved 4- 1
Town to consider expanded police facility

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Following five hours of heated public comments and an hour- long, closed-door executive session, Dewey Beach Town Council voted 4-1 to approve a mutual agreement developed by the town and Ruddertowne developer Dewey Beach Enterprises. As the sun was setting outside the broad windows of the Baycenter, Mayor Diane Hanson said, “Let’s move on and make the best of it.” Hanson was the only commissioner who voted against the project.

The agreement allows Dewey Beach Enterprises ( DBE) to redevelop Ruddertowne into a 45.67- foot, mixed-use build-ing to include a hotel, condominiums, retail space, a publicly accessible bay walk, public restrooms, additional public parking and $ 60,000 worth of space for the town to use as it sees fit.

Commissioners Rick Solloway and Jim Laird suggested dedicating space to the police department to reduce drunken behavior. “I see this as a huge opportunity to allow our police force to provide resources to create a better experience in Dewey Beach,” Solloway said.

“People behave as you expect them to behave,” Laird said after the meeting. A police station would allow the town to deal with public drunkenness properly, Laird said, rather than handing people a fine and letting them go.

Laird, who ran alongside Commissioner Marty Seitz in the September election, said Seitz’s unexpected vote to approve the agreement gave him the confidence to do the same. “ It was this council’s responsibility to get us out of the situation, and I think we did,” Laird said.

Seitz, a longtime supporter of the town’s 35-foot height limit, voted to approve the plan.

“Maybe my vote was the only one not anticipated. Perhaps my vote gives me the stature to move forward and work with the developer to address the interests of the community,” said Seitz in an email.

Seitz said he does not believe the Ruddertowne project will open the doors for other developers to exceed the height limit.

“The settlement has merits. The 46 feet is greatly reduced from the 68 feet originally required by the developer. I attribute this significant reduction to the response of people who formed and supported the Citizens to Preserve Dewey (CPD),” Seitz wrote.

Seitz also said he believes the new building will promote more family-oriented activities in Dewey Beach. A resolution, read into the record by town attorney Glenn Mandalas says half of the designated retail and restaurant space will be used in the off¬-season for children’s activities. Laird said, and DBE partner Jim Baeurle confirmed, the developer has agreed to put an ice-skating rink on one of the parking levels in the off-season.

Commissioner James “ Zeke” Przygocki said in an email, by Saturday, he had mostly decided to approve the agreement and was reaffirmed by public input. “ Mr. Seitz really surprised me in the end, and Ms. Hanson’s vote did not surprise me, yet her rationale for the vote did,” Przygocki wrote.

Hanson said at the meeting she voted against the project because of overwhelming opposition from Dewey Beach property owners.

“I vote no in the name of the people,” she said.

CPD cofounder Joy Howell said CPD collected more than 300 signatures from property owners requesting the decision go to referendum. Howell said letters to the town in support of DBE were largely from nonresidents. “There’s no question she was representing the will of the property owners,” Howell said of Hanson’s vote.

The end to litigation

The agreement will end almost four years of litigation between DBE and Dewey Beach and drop five pending lawsuits against the town.

Prior to the vote, commissioners received an email saying insurance carrier Darwin Insurance Company recommended they accept the proposed agreement.

Seitz wrote he received an email from the town manager late Friday stating the insurance company is concerned the town will face enormous financial exposure in the pending litigation.

“The insurance company elevated this to a much higher level at the very last minute, and I believe that’s what might have influenced some of my colleagues’ votes,” Hanson said.

According to Mandalas, the town’s insurance would not have been cut off, but Darwin’s financial obligation to the town would have been reduced if the commissioners had decided not to settle.

“It played a part in where we were, that’s for sure,” Laird said.

DBE partner Jim Baeurle said he was not sure which way council would vote. “I have always felt that the law was and is on our side and that eventually a majority of council would see that,” Baeurle said.

The public hearing

Public comments at the hearing were fairly evenly divided.

The morning of Saturday, Feb. 26, began with a request from CPD asking their lawyer be allowed more time to speak than the maximum time of nine minutes per person. CPD is a volunteer group formed to oppose any developer that tries to exceed the town’s 35-¬foot height limit.

The request was met with opposition. Mandalas advised against it.

“If they get 15 minutes, I want 15 minutes,” said former Mayor Pat Wright. Ultimately, Hanson ruled CPD’s attorney would be allowed no more than nine minutes.

Barrett Edwards, attorney for Hudson, Jones, Jaywork and Fisher of Delaware, spoke on behalf of CPD. He said the town’s comprehensive plan has the force of law, but the plan should not violate the town’s zoning code. Edwards said DBE’s intention to go above 35 feet would break the law. “It’s not within their right to go above and beyond the zoning code,” Edwards said.

Anna Legates questioned DBE’s 6- year building permit. “ It took four-and-a-half years to build the Empire State Building,” she said. Legates continued to address council after her nine min-utes had expired.

Loud, disruptive coughs prompted council to ask her to sit down. Year-round resident Kelly Ranieri said it was time the town accept compromise and move forward. “ Walking in here, I saw a few people, I gave them a smile. They did not smile back at me because they knew I was going to ask you to vote ‘yes.’ That behavior needs to move on,” Ranieri said.

Twice during the hearing, speakers were interrupted be-cause commissioners were accused of ground-rule violations.

First, Hanson accused Solloway of sending text messages on his cell phone.

“I’m not texting, I’m looking at the town website,” Solloway said.

“This is against the rules, Rick; I’m sorry,” said Hanson. The second violation occurred when John Gephart, who spoke against the agreement, stood up from his seat and told Hanson he saw Laird pass a note to DBE representatives, watched them write something down and pass the note back.

“That’s the equivalent of tex-ting,” Gephart said. “I think that note should be examined.”

Mandalas advised council there was no need to examine the note. Laird said the note was a continuation of an earlier discussion.

Delaware House Majority Leader Pete Schwartzkopf, D-Re-hoboth, took the podium to address the issue of gambling. “I have no intention of bringing gambling to this town,” he said.

“The theory of gambling is a flat-out lie.” When Schwartzkopf expressed his interest in bringing Dewey Beach into his 14th Representative District, members of the crowd, predominately CPD, booed him loudly.

Responding after the meeting, Baeurle said in an email, “What was clear on Saturday is that there is great support for this project.

“I hope and expect that CPD will be good neighbors and join the majority of property owners and work to facilitate the best outcome possible for this project.”

Howell said CPD is not planning to challenge the vote. “Our inclination at this point is to just let the decision stand,” Howell said.

CPD Editor’s Note on Cape Gazette Article, March 2, 2011
Rep. Pete Schwartzkopf was booed because he gutted our 35-ft charter amendment that was opposed by DBE, he set up volunteer Mayor Diane Hanson for trumped up ethics charges when she displeased DBE and he helped DBE sue our town in the sixth lawsuit. Sussex County political observers have commented that he only won by a slim margin of around 700 votes last fall, is it possible he is looking to Dewey voters for support?
The vote on Saturday broke two town zoning laws, avoided the normal substantive Planning and Zoning Commission review and was, by our land use attorney’s estimation, contract zoning at its finest. But onward and upward. Let’s hope the development is the town center that everyone wants.

CPD Legal Counsel statement prior to vote

Dear Friends and Neighbors:

The comments below are from Barrett Edwards of Hudson Jones Jaywork and Fisher who represented CPD property owners at the Ruddertowne public hearing last Saturday. We thought you should see his very succinct and powerful presentation that the Council did not have the authority to enter into this settlement agreement. In his view, the settlement amounted to contract zoning and avoidance of the substantive planning and zoning/board of adjustment review for variances which is required by our zoning law. In addition, the Town Council ignored the will of the people, over 330 of you, who asked for a referendum to settle this issue democratically. We hope you all will remember that in the next elections. Please remember Hudson, Jones, Jaywork and Fisher for your future legal needs.

Citizens to Preserve Dewey
________________________
Presentation by Barrett Edwards, Hudson, Jones, Jaywork and Fisher

Mayor and Commissioners, thank you for the opportunity to address you today regarding the proposed development plan in question. My name is Barrett Edwards and I’m an attorney with the law firm of Hudson, Jones, Jaywork, and Fisher, and I’m here today representing the interests of Citizens to Preserve Dewey. The legal mess we are now engulfed in is truly a travesty for both sides. On the one hand, DBE has a legal right to develop their property in accordance with the laws and ordinances of Dewey Beach and the State of Delaware. On the other hand, the town has been peppered with lawsuits surrounding this development. Citizens to Preserve Dewey is not opposed to the development in question; they simply want the developers to comply with the established laws of Dewey Beach. Citizens to Preserve Dewey object to the approval of this development for various reasons, but I’m going to focus on three reasons here. First, the Town Council has no authority to relax the height restriction and hotel prohibition found in the town code. Second, the Comprehensive Plan does not authorize the town to circumvent either the new or old zoning code. Third, approving the development in conjunction with the Mutual Agreement and Release smacks of contract zoning.

By approving this development today, the Town would not be requiring DBE to play by the same rules everyone else does. It is well established that development in excess of 35 feet is prohibited in Dewey Beach. This requirement is found in the old zoning code, it is found in the new Zoning Code, and in the new PRB-1 zoning district, the Zoning Code specifically states that while some bulk standards may be relaxed, height standards shall not be relaxed. Along the same vein, the town adopted an ordinance in 2000 eliminating the ability to have hotels in the RB district. There is no disputing that the town can legislatively decide to again authorize hotels in the RB-1 district or to expand the height restriction in the same district. But should council do this, the citizens would surely exercise their rights delegated to them by the General Assembly under the town charter to challenge the adoption of an ordinance via referendum. Alternatively, a variance could be sought for the height. Absent a change from where we stand today, the Commission lacks authority to circumvent the height requirements and hotel prohibitions found in the Zoning Code to approve this development.

The Comprehensive Plan does not delegated authority to the Town Commission to circumvent the Dewey’s Zoning regulations. There appears to be little dispute that the proposed plan violates the Zoning Code; the crux of the issue is whether the Comprehensive Plan authorizes the commissioners to circumvent the Zoning regulations. The Comprehensive Plan does no such thing. As has been continually cited, the Comprehensive Plan in Delaware has the force of law. However, in giving the Comprehensive Plan force of law, there is no way that the General Assembly was intending to write a blank check for municipalities to violate all other existing state and town regulations through the guise of the Comprehensive Plan. Under 22 Del. C. § 307, whenever a Zoning Code requires a lower building height than another statute, ordinance or regulation, the lower building height restriction found in the Zoning Code applies. In other words, per state law, where the Dewey Beach Zoning Code prohibits buildings in excess of 35 feet, no statute, ordinance, or regulation can circumvent this restriction, and it defies logic that the General Assembly intended on allowing towns to bypass this state statute through the comprehensive plan. More importantly, however, is that there should never be a question regarding the difference between the Zoning Code and Comprehensive Plan because the two must be consistent. Delaware law requires in 22 Del. C. § 303 that “[zoning] regulations be made in accordance with a comprehensive plan” and 22 Del. C. § 702(c) states that “[t]he comprehensive plan shall be the basis for the development of zoning regulations.” The Comprehensive Plan and Zoning Code must be in agreement, and any approved development plan must comply with both. If the Comprehensive Plan allows 45-foot buildings and hotels, then this must be included in the Zoning Code.

On more simplistic terms, however, the Comprehensive Plan does not grant unfettered authority to the working group or the commission to approve plans in violation of the Zoning Code. The authorizing language that is being relied on begins, “The percentages listed herein are the ideals of this Plan, however . . .” and then it goes on to describe the Commissioner’s ability to ratify the working group’s recommendation and that such recommendation would be deemed consistent with the Plan. Read in context, any authorization granted here is strictly limited to determining the percentages, presumably the ratio of residential to commercial use. If the working group had any valid authority, it was limited to making a recommendation regarding this ratio, and nothing more.

But in its most simple form, the Comprehensive Plan does not violate any state or local laws because it never touches on building height or hotels. These are items properly addressed in the Zoning Code. It is true that relaxed bulk standards are mentioned, but in the Zoning Code that was adopted to comply with the Comprehensive Plan, it was clarified that relaxed bulk standards to not apply to height. The height limitation in Dewey was and remains 35 feet, and unless the Zoning Code is amended or a variance is sought, this maximum height cannot be changed.

Lastly, authorizing height and hotels in excess of the current town standards can be construed as contract zoning. Contract zoning does not just involve agreements to rezone property. The Delaware Court of Chancery, in Hartman v. Buckson, found contract zoning when in response to a developer threatening to sue the Town of Camden over alleged zoning code infirmities, the town compromised with the developer with respect to how many units could be placed on a development parcel. There was no rezoning involved, just as there is no rezoning involved here. This plan is authorized pursuant to an agreement whereby both the town and developer will receive various benefits. The agreement continually indicates that DBE is voluntarily doing things. If it is truly voluntary, then they cannot be bound to the agreement. But if they are to be bound to the agreement, which I think they should be if the agreement is entered into, this raises more than a suspicion of contract zoning.

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