10th Circuit Court of Appeals to decide whether to reinstate Mill Street Plaza suit
For a Mark Hunt-controlled entity to sue the city over development rights at the two-building Mill Street Plaza, his legal team must convince the 10th U.S. Circuit Court of Appeals the Aspen government is intent on not allowing him to develop free-market apartments there.
On Tuesday in Denver, the three-judge panel heard in-person, oral arguments from attorneys for Hunt and the city of Aspen, which are at odds over how the property can be used. The hearing came after Chief U.S. District Court Judge Philip Brimmer dismissed the lawsuit against the city — filed by North Mill Street LLC, the entity that owns the plaza — in March 2020.
Brimmer tossed the suit due partly to Mill Street Plaza’s failure to exhaust the city’s land-use approval process by not seeking a planned development review. In other words, the case was “unripe” for judicial review because the LLC’s failed rezoning attempts at both the planning and zoning and city council levels didn’t bring “finality” to the municipal development process, the judge concluded.
Boulder attorney Josh Marks, arguing for the city, lobbied the appellate judges to uphold Brimmer’s dismissal of the case. Marks said because Hunt’s LLC did not file a land-use application and did not seek a planned development review, there’s no way of knowing how the city would have decided on the actual project proposal. It only attempted to rezone the property and was unsuccessful, he said.
“At the end of the day, your honor, even if this (inaudible word) contains a little bit of doubt as to whether the PD (planned development) is going to be successful or not, this court should not be prognosticating over whether it’s going to be successful or not,” Marks said. “And the best medicine for determining whether finality exists is to make someone go through the process.”
The appellate judges took the matter under advisement after also listening to attorney Chris Bryan argue it would have been futile for Hunt to continue to pursue the development because the outcome to his proposal was predetermined.
“The city already said it’s not compatible with the surrounding area, the community character,” Bryan said in reference to rezoning denials by both planning & zoning and city council. The hope had been to rezone Mill Street Plaza to mixed-use to allow residential and commercial.
Mill Street Plaza is zoned service-commercial-industrial, or SCI, and has such locally serving tenants as an auto repair shop, a sports consignment store and a bike rental shop.
Also hamstringing Hunt’s desire to build residential is Ordinance 29, adopted by City Council in January 2017, Bryan told the panel. The ordinance prohibits developers from seeking conditional uses to build residential in the the SCI zone, which also made the outcome predetermined, Bryan argued.
“A variance for free-market residential is not allowed,” he said. “There’s an ordinance that bans it; it prohibits it. Before that ordinance went into effect, free-market residential was permitted as a conditional use only.
“And if the city had not enacted this ordinance, the city might well have a very good argument here: that I should have gone to them, that I should have done that.
“But by enacting the ordinance that prohibits free-market residential use at this property, they took away their own discretion, the discretion they claim they now have on a PD application.”
Bryan said the plaza is the city’s sole SCI district without free-market housing. Other SCI zones, like Obermeyer Place, were granted exceptions to build residential before Ordinance 29 was passed and took effect.
The lawsuit — which was dismissed without prejudice, meaning that it can be refiled — argued Ordinance 29 unfairly targeted Mill Street Plaza by not allowing residential development there. Other civil claims include allegations that the city violated Hunt’s right to due process and his equal protection by forbidding free-market housing while other SCI developments in Aspen have built free-market housing.
Mill Street Plaza is located across Puppy Smith Street from the Clark’s Market shopping center and comprises the 465 N. Mill St. property, a 20,000-square-foot building that sits on 49,901 square feet of land; and the property at 557 N. Mill St., an 8,000-square-foot building on 6,301 square feet of land, according to property records. Hunt’s LLC acquired the property for $15 million in June 2018.
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