10th Circuit sides with city of Aspen in Mill Street Plaza dispute
The 10th Circuit Court of Appeals this week affirmed the dismissal of a lawsuit against the city of Aspen that challenged its zoning laws concerning a parcel of commercial space with locally serving businesses.
The three-judge panel delivered its 31-page ruling Tuesday, upholding Chief U.S. District Court Judge Philip Brimmer’s March 2020 dismissal of the suit levied by North Mill Street LLC, a Mark Hunt-controlled limited liability company that owns Mill Street Plaza.
Like Brimmer, the panel concluded the LLC’s suit wasn’t “ripe” for litigation because Hunt, a developer with multiple commercial properties peppered through downtown Aspen, didn’t exhaust the city’s land-use approval process by seeking a planned development review. The LLC, however, unsuccessfully tried to rezone the property so free-market apartments could be built at the plaza, which is located across Puppy Smith Street from the Clark’s Market shopping center.
Because the Hunt LLC did not bring “finality” to the municipal land-use process by filing for a PD, the appellate panel said the suit was not ready for judicial review.
“I think it’s important because it recognizes our processes, which are an available avenue for the owner of this property to pursue his goals,” said Jim True, city attorney. ”And that was our position throughout the litigation — that we have processes that are appropriate.“
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Though the 10th Circuit upheld the dismissal, it disagreed with part of Brimmer’s reasoning to throw it out, which was that the federal district court didn’t have jurisdiction in the dispute.
“But we hold dismissal was proper for lack of prudential ripeness,” the ruling said.
North Mill Street LLC has 14 days from Tuesday’s ruling to submit a petition for a rehearing before the Denver-based 10th Circuit Court of Appeals, which has a total of 12 active judges.
“We are analyzing the federal appellate court’s published opinion that was issued,” said attorney Chris Bryan of Aspen firm Garfield & Hecht, which has litigated the matter on Hunt’s behalf. The statement was issued via email. “We are pleased that the appeals court agreed with our jurisdictional arguments, and we are considering next steps now that the Tenth Circuit has provided clarity on an issue of law that, as the court itself acknowledged, it had not ruled on before.
“We hope the City of Aspen takes this result to heart and engages with the property owner in earnest and forthright discussions about the redevelopment of the subject property.”
This week’s ruling came after in-person, oral arguments were held before the panel June 22 in Denver. At the hearing, Bryan said there was no point for Hunt’s LLC to submit a planned development application because the city already had decided it would not allow free-market residences at the plaza.
The plaza is zoned service-commercial-industrial, or SCI, and has a bike shop, used sporting goods store, a mechanic business and other tenants. At last month’s hearing, Bryan also argued that downzoning through Ordinance 29, adopted by City Council in January 2017, didn’t allow developers to seek conditional uses to build residential on SCI property.
Prior to the ordinance’s passage, conditional-use reviews were permitted for SCI districts.
Hunt’s LLC acquired the property for $15 million in June 2018, after the ordinance took effect. The LLC subsequently attempted to have the city rezone the plaza to mixed-use allowing residential and commercial, but it was denied by both planning & zoning and Aspen City Council.
“When (North Mill Street’s) predecessor in interest purchased the property in 2007, free market residential development was allowed in the SCI zone as a ‘conditional’ or ‘ancillary’ use,” the ruling said. “Of the four SCI-zoned properties in Aspen, only Mill Street Plaza lacked any (free-market residential) units. (North Mill Street) alleged that without the opportunity to develop (free-market residential) units at (Mill Street Plaza), future redevelopment of the Mill Street Plaza is not economically viable.”
Mill Street Plaza has two buildings — one is 20,000 square feet on 49,901 square feet of land at 465 N. Mill St.; the other is at 557 N. Mill St. and comprises an 8,000-square-foot building on 6,301 square feet of land, according to property records.
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