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Fowler v. City of Bethlehem Zoning Hearing Board

Commonwealth Court of Pennsylvania

May 22, 2018

Beall Fowler, Robert Romeril, Martin Romeril, Barbara Diamond, Timothy T. Stevens, Esquire and Bruce Haines, Appellants
City of Bethlehem Zoning Hearing Board

          Argued: April 12, 2018




         Beall Fowler, Robert Romeril, Martin Romeril, Barbara Diamond, Timothy T. Stevens, Esquire, and Bruce Haines (Objectors) appeal from an Order of the Court of Common Pleas of Northampton County (trial court), which dismissed Objectors' appeal and affirmed a decision by the City of Bethlehem Zoning Hearing Board (ZHB) to grant a use variance to Morning Star Partners, LLC (Applicant). The trial court found that prior zoning decisions involving the same property did not bar Applicant from seeking this variance under the doctrines of res judicata or collateral estoppel. Moreover, the trial court found that Applicant established the necessary requirements for a use variance, including, inter alia, the existence of a hardship that was not self-imposed. We agree that res judicata and collateral estoppel do not bar this action. However, Applicant did not show the currently conforming single-family dwelling could not continue to be used as such, and, in the absence of evidence of an unnecessary hardship, we must reverse.


         This zoning appeal involves property located at 2 West Market Street, Bethlehem, Northampton County, Pennsylvania (Property).[1] The Property measures 0.198 acres, or approximately 8276 square feet. It contains a large single-family residence located on the corner of West Market and New Streets; two smaller buildings that are connected, fronting New Street, which house retail space on the first floor and an apartment on the second floor; and a detached garage with an apartment above.

         The Property is located in the RT-Residential Zoning District, which is high density residential. Retail is not a permitted use in the district, but because the retail uses predate the local zoning ordinance (Ordinance), they are considered lawful nonconforming uses. In addition, the lot size itself is also nonconforming. The minimum lot size for the existing uses on the Property is 15, 500 square feet. The Property is adjacent to a commercial district on the north, and nearby are a Verizon store, a law office, the Moravian Academy, the Glemser office building, the Bethlehem Inn, a cemetery, and a mix of residential and commercial uses on Market Street.

         Applicant purchased the Property with the intent of using it for its financial services office, which is a commercial use not permitted in the zoning district. To accomplish its goal, Applicant sought zoning relief on a number of occasions. Its first two attempts were unsuccessful. Because those attempts form the basis of Objectors' res judicata or collateral estoppel argument with the most recent zoning relief application, we briefly recount that history now.

         A. Prior Applications

         Applicant first sought a special exception and/or variance in 2013 (2013 Application).[2] At that time, Applicant proposed converting the single-family residence into an office and maintaining the two retail spaces. (Nov. 27, 2013 ZHB Decision, Reproduced Record (R.R.) at 10a.) Applicant requested a special exception under Article 1304.04 of the Ordinance, entitled "Reuse of Corner Commercial Uses, " which was denied because the single-family residence did not qualify as the primary building with an existing storefront character. (Id.) Applicant alternately requested a use variance under Article 1325.06 of the Ordinance, which was also denied. The ZHB found Applicant did not meet its burden of showing a hardship. The ZHB noted the Property was only on the market for four months, undercutting a realtor's testimony that selling the Property is challenging because of its mixed use. (Id. at 13a.) The ZHB also found inadequate Applicant's explanation as to why the residence, which was a conforming use, could not remain residential. (Id.) It found that Applicant wanted to maximize profitable uses of the Property, which was insufficient for a variance. (Id. at 15a.)

         Applicant appealed the denial of its 2013 Application to the trial court, which affirmed. (May 20, 2014 Trial Ct. Opinion (Op.), R.R. at 28a-36a.) On appeal to our Court, we similarly affirmed denial of the variance. Schadt v. City of Bethlehem Zoning Hearing Bd., 119 A.3d 439 (Pa. Cmwlth. 2015). This Court found that Applicant did not demonstrate an unnecessary hardship, noting that the single-family dwelling was used as a residence for more than a century. Id. at 442. This, we held, "belies the claim that the property cannot be used without a variance." Id. We also rejected Applicant's claim that the presence of the nonconforming retail spaces constitutes a unique physical condition that prevents use of the Property in conformance with the Ordinance. Id. at 443. We echoed the trial court by saying that Applicant was not "entitled to make the property more nonconforming by virtue of the existing non-conformance." Id. (emphasis added).

         In April 2014, while the appeals were pending, Applicant submitted a second application (2014 Application), this time seeking a use variance and a dimensional variance. The ZHB denied the 2014 Application on the grounds of res judicata. (June 6, 2014 ZHB Decision, R.R. at 18a-26a.) This decision was not appealed.

         B. Present Application

         In 2016, Applicant submitted its third zoning application (2016 Application), which is the subject of this appeal. In the 2016 Application, it sought a special exception for the change of one nonconforming use to another or, in the alternative, a use variance to convert the existing residence and retail building into offices and one apartment.

         At a hearing on the 2016 Application, the Zoning Officer testified that this was the first time the Applicant was before the ZHB for a proposed single-residential use and single-office use. She testified that the minimum square footage for the proposed uses under the Ordinance still exceeded the Property's lot size - 9500 square feet (minimum) versus 8276 square feet (actual). Therefore, the proposed use would reduce the size of the lot nonconformity.

         Applicant's Engineer also testified at the hearing as to the specifics of the Property and the proposed use, as well as the adjacent uses. Because the retail space is less than 10 feet from the residence, according to Engineer, the Property cannot be subdivided. Engineer testified that under the plan, "two uses [are] replacing five." (Hr'g Tr., Supplemental Reproduced Record (S.R.R.) at 24b.)

         Applicant also presented a pre-construction services witness (Contractor), who testified as to the scope and cost of renovations. Contractor explained the exterior of the residence would be unchanged to maintain its residential character. The residence would be painted, a wheelchair ramp installed, a porch reconstructed, sidewalks repaired, and landscaping completed. All changes would meet applicable Historic District guidelines. Interiorly, the first floor kitchen would be removed and replaced with a kitchenette. The front door and bathrooms would be made ADA-compliant. The second floor would have walls removed to allow for the creation of five offices. The third floor attic would also be renovated. Renovations would also be made to the buildings housing the retail space and the studio apartment above the garage. Total cost for renovations is approximately $722, 000.[3]

         On cross-examination, Contractor acknowledged that the current nonconforming retail spaces "[p]robably" could be converted into residential space for the same amount. (Id. at 69b.) When asked by a ZHB member what the extent of the renovations would be in order to maintain the single-family house as a residential unit, Contractor responded: "If that were a residential [unit], somebody were to buy it as a house, we believe they would have to invest another $225, 000 into the property." (Id. at 73b.) The retail buildings are "prime candidates for razing, " but Contractor acknowledged that given their historic nature, obtaining approval to do so would be difficult. (Id. at 75b-78b.)

         A commercial loan officer also testified that financing was difficult to obtain because of the Property's mixed uses. A partner at Applicant testified the financial services office would have 14 employees, 11 of whom would be full-time and 3 of whom would be part-time. Only one to two clients would visit the office each day.[4]Office hours would be Monday through Friday, 8:30 a.m. to 4:30 p.m. There would be no signage, except for an address plate.

         In addition, at the hearing, a number of Objectors testified in opposition to the project and a number of residents and business owners testified in support of it.

         C. ZHB Decision

         Following the hearing, the ZHB voted 4-0 to deny the special exception request. The ZHB rejected Applicant's argument that the entire Property was nonconforming, instead finding that only the two retail spaces were nonconforming. (July 15, 2016 ZHB Decision at 6-7.) It also rejected Applicant's argument that the dimensional nonconformities do not render the entire Property nonconforming. (Id. at 7.) Thus, the proposal did not involve a change from one nonconforming use to another.[5] (Id. at 6.)

         The ZHB, however, voted 3-1 to grant the use variance under Article 1325.06 of the Ordinance, subject to certain conditions.[6] The ZHB found Applicant satisfied its burden of proof. With regard to the hardship element, the ZHB found the following physical hardships existed:

• The Property is less than 9, 000 [square feet] in area but contains a single-family residence, a garage with a second story apartment, and a third building with two retail units on the first floor and an apartment on the second floor. There is an existing parking area and little outdoor space to serve a residential use.
• The home on the Property dates to 1840 and is in need of significant renovation irrespective of whether the use is ...

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