Property Rights Wins: Taking Via Retroactive Zoning Struck Down by Maryland Court of Special Appeals

Despite recent losses on the property rights front, especially the Supreme Court’s Kelo decision this year, some successes can be celebrated.

One is a victory for property owners in Prince George’s County, one of Washington, D.C.’s bedroom communities, where a court has ruled against a county effort to toss small car dealerships off of property they in some cases have owned and operated upon for years, so the county can lure as many as 100 artists to open studios on their land.

As the Washington Post reports:

When the gravel-covered used-car lots that dot Route 1 stood in the way of plans to turn the highway into an arts district, Prince George’s County thought it could declare the businesses illegal and turn what it called blight into beauty.It was wrong.

The Maryland Court of Special Appeals has ruled in favor of the car dealers and against the county council, which passed a law, effective in 2003, that banned all dealerships of less than 25,000 square feet.The county offered no compensation to the car dealers, some of whom had operated along Route 1 for years.

The dealers fought back, and Judge Deborah S. Eyler agreed with them, writing on behalf of the court that banning small dealerships is “not rationally related to a possible legitimate purpose…”

I’m cheered by this victory. It has bugged me for two years that Prince George’s County would try to do this to small business owners. Here’s part of the 2003 Washington Post article that got me steamed in the first place:

The forest-green 1994 Buick LeSabre with whitewalls is still reliable at 100,008 miles, the salesman said. It sits on the lot next to a maroon Toyota Supra with peeling paint and a rusting gold Camry that’s seen better days. Like the other cars parked on the gravel patch on Hyattsville’s main drag, none of them sells for more than $5,000, the kind of bargain that Vernon Wolverton’s customers have expected for 33 years.Head north out of the District on U.S. Route 1 and you’ll pass dozens of places like Wolverton’s Suburban Motors. Nearly half the 97 licensed used-car dealers in Prince George’s County do business on or around the 20-mile stretch from the District line to Laurel, a road once known as the Washington region’s Car Alley. Over the decades, large new-car showrooms and secondhand dealers left for less-crowded suburbs. That left the small independent lots that cater to a local clientele — a landscape like many sections of Route 1 between Key West and the Canadian border.

Now, under a plan set in motion by county leaders three years ago, the car lots are about to be zoned out of existence. Beginning Sept. 1, it will be illegal for used-car lots smaller than 25,000 square feet to operate in the county, a limit that will force nearly all of the dealers on the highway to close. The untidy mix no longer fits with the county’s image of itself as it attempts to attract more retailers and shoppers.

“Having a small used-car lot that has twinkly decorations and vehicles that are not in very good condition does not help to improve value of a commercial area,” said Elaine Murphy, city administrator of Hyattsville, which has four such dealerships.

The measure was sponsored by Prince George’s County Council Chairman Peter A. Shapiro (D-Brentwood), who champions a plan to recharge the business area north of the District line by turning it into an arts district.

“There is a need and a demand for selling used cars,” Shapiro said, “but I don’t think it is appropriate for them to be clustered on our primary commercial corridor . . . where we are focused on redevelopment and revitalization…”

…Weathered flags from nations of the world flap around Y2K Auto Sales, a 23,000-square-foot cement lot on Route 1. Owner Tony Sia is the first to acknowledge that his faded banners and yellow sign aren’t pretty, but it doesn’t seem fair to him that his industry is being picked on for its lack of aesthetics. Eyeing a junkyard on the other side of the railroad track across the highway, Sia said: “You can’t have one side nice.”

…Inside the two-room trailer that serves as the office at Suburban Motors, salesman Jack Clay pointed to a certificate taped to the wood panel closet door. “Why would the state send me my license if I can’t operate?” he said.

Dino Saglimbeni, who opened Dino’s Used Cars and Rentals in Riverdale in 1977, said he dismissed the chatter about the new law he heard last year at an auto auction. “I thought the guy was just running his mouth,” Saglimbeni said, shrugging his shoulders and tossing up his hands.

Told last week that the law had passed, Saglimbeni began calculating the size of his lot in his head. A small vein bulged in his neck, and he immediately called his lawyer and three neighboring used-car lot owners. He hopes that his business, which is stretched over three lots, might be just large enough to squeak by…

Retroactive zoning is a form of taking, and in this case, a taking for which the county was refusing to provide compensation. Taking one person’s business to give the land it sits upon to another private business operating for private profit is just plain wrong.For what it is worth, I live in Laurel, one of the towns mentioned as part of “car alley,” and I agree that art studios would be prettier than used car lots. But hey, the used car guys bought those lots fair and square. If we don’t like it, we need to make them a financial offer so good they don’t want to turn it down. But that’s not what the county government tried to do. Nope. It just wanted to kick them out. And that’s just not right.

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