Thursday, June 13, 2024

Can’t fight city hall? Lawsuit over Wilmington planning commission move settles

The complicated lawsuit highlights the difficulty faced by residents who want to make their case before the city in official hearings, especially when arguing against skilled attorneys with time, money, and other resources at their disposal.

The case of Janet Parsons versus the City of Wilmington highlights an important question: can individual residents ever have equal footing against developers in matters of city planning and zoning? (Port City Daily photo | New Hanover County Superior Court)
The case of Janet Parsons versus the City of Wilmington highlights an important question: can individual residents ever have equal footing against developers in matters of city planning and zoning? (Port City Daily photo | New Hanover County Superior Court)

WILMINGTON — The case of Janet Parsons v. City of Wilmington was a complicated lawsuit which few people have ever heard about, but in several key ways it cuts to a basic question: can individual residents ever have equal footing against developers in matters of city planning and zoning?

The issue has a lot do to with what’s known as “quasi-judicial hearings,” like those required for special use permits and other major changes proposed before Wilmington’s Planning Commission. These hearings operate much like courtroom procedure, requiring evidence and standing –- a resident cannot walk into one of these hearings and make an emotional appeal or speak on an issue that doesn’t impact them directly.

As Wilmington residents have seen in the special use permit proceedings for major developments like The Avenue and CenterPoint, Planning Commissioners and City Council members are required to make their decision based on hard evidence brought by experts, and cannot – and thus do not – respond to public outcry.

It’s a process that seems to favor developers over the public, in the sense that developers – or, more often, their attorneys – have historically appeared at such hearings prepared, while residents often do not. It’s also worth pointing out that developers usually have ample time to make their case, while sworn testimony from residents is limited (often to about 3 minutes).

But what happens when a resident is prepared and does want to bring their own evidence and expert testimony? That’s in large part what Parsons v. Wilmington was about. The case recently settled, but it is a valuable window into a process that few residents understand, even if all are at the mercy of it.

6329 Head Road

6329 Head Road was the center of a lawsuit against the city; the case puts the ability of residents to make a case to the planning commission in the spotlight. (Port City Daily photo | Benjamin Schachtman)
6329 Head Road was the center of a lawsuit against the city; the case puts the ability of residents to make a case to the planning commission in the spotlight. (Port City Daily photo | Benjamin Schachtman)

The story of the Head Road property begins in 2014, when Thomas Fetzer purchased the lot.

Fetzer, the former mayor of Raleigh and chair of the North Carolina Republican party from 2009 to 2011, paid $1.35 million for the property, according to New Hanover County property records.

It would later become clear that Fetzer hoped to subdivide the property, but in 2014 there were two issues.

The first was that it partially wetland; the parcel was technically around 7.5 acres, but a significant portion – nearly two acres – of it was marsh or submerged under Costin’s Branch, a tributary of Hewlett’s Creek; this assessment came from a survey that would later be conducted by a consulting group and certified by the North Carolina Division of Coastal Management, the branch of the government that issues permits in compliance with the states Coastal Area Management Act (CAMA).

A survey of the property, prepared in April 2016, shows that nearly 2 acres of the land in considered to be coastal wetlands. (Port City Daily photo | North Carolina Division of Coastal Management)
A survey of the property, prepared in April 2016, shows that nearly 2 acres of the land are considered to be coastal wetlands. (Port City Daily photo | City of Wilmington)

The second issue was that under the city’s ordinances at the time, the lot would not have appropriate road access. To provide road access, an easement would have to be created through the property to the north, which belonged to Janet Parsons.

The 7.5-acre property at 6329 Head Road is partially submerged, and does not technically connect to the nearest city road -- two issues that made subdividing the property impossible in 2014. (Port City Daily photo | City of Wilmington)
The 7.5-acre property at 6329 Head Road is partially submerged and does not technically connect to the nearest city road — two issues that made subdividing the property impossible in 2014. (Port City Daily photo | City of Wilmington)

This left Fetzer sitting on a property that – while it could be built on – could not be subdivided and sold at a profit. Unless, of course, the city’s ordinances were changed.

Enter attorney and State Senator Michael Lee.

The creation of “conservation districts”

In 2016, Michael Lee applied on to the Wilmington Planning Commission to change the city's land use codes; 6329 Head Road was used as an "example." (Port City Daily photo | City of Wilmington)
In 2016, Michael Lee applied on to the Wilmington Planning Commission to change the city’s land use codes; 6329 Head Road was used as an “example.” (Port City Daily photo | City of Wilmington)

In early January, Lee applied to the Planning Commission to create a new category of zoning called a “conservation tract,” which would create an exemption for subdivision access requirements. It would require city-maintained access to only one of the subdivided properties – an arrangement which would allow 6329 Head Road to be divided up.

The amendment would allow parcels that bordered a CAMA conservation area (like a watershed or marsh) and were between 4 and 8 acres in size to be divided into parcels with a minimum size of 2 acres. Lee said this would encourage environmentally-friendly, less-dense development.

Lee used 6329 Head Road as his example of a property that would benefit from this new amendment, but said 20 other parcels would also benefit.

The Planning Commission approved the amendment, 6-1; Commissioner Bruce Bowman voted against the amendment, saying it was too narrowly focused for an amendment to the land development code.

Jumping the gun?

In April of 2016, Wilmington’s technical review board approved a plan prepared by Paramounte Engineering to divide the Head Road property into three parcels: two 2.368-acre lots and one 2.75-acre lot bordering Hewlett’s creek, which already had a three-car garage and foundation work for a residential building on it.

Having acquired city approval for what, presumably, would be a profitable subdivision, Fetzer sold the property in late June. According to county property records, Fetzer sold the parcel – which had not yet technically been subdivided – to Richard Webb, Jr. and his wife, Jill Webb, for $1.99 million on June 27, 2016, an approximately $650,000 profit.

The deed was prepared “without title examination” by Lee’s law firm.

The following month, after the Subdivision Review Board unanimously approved the division, there came some push-back.

On July 28, five nearby residents – including Janet Parsons – filed appeals against the Head Road subdivision. Parsons, in particular, because the project would put a road through her property.

The appeal hearing

On September 7, 2016, the Planning Commission held a quasi-judicial appeal hearing.

The appeal was based on two issues – that the access road through Parsons’ property was insufficient for emergency vehicles – a city requirement – and perhaps more importantly, that the Head Road property was actually not large enough to divide into three lots; the second argument was, in short, that since the size of the parcel – minus those state-owned waterways of Costin’s Creek – was closer to 5.5-acres than 7.5-acres.

The private road that leads to 6329 Head Road would prove challenging to emergency vehicles, neighbors argued. (Port City Daily photo | Benjamin Schachtman)
The private road that leads to 6329 Head Road would prove challenging to emergency vehicles, neighbors argued. (Port City Daily photo | Benjamin Schachtman)

At the hearing, Lee was joined by the Webbs, along with Robbie Parker, the title law expert from Lee’s law office, and Rob Balland, an engineer with Paramounte Engineering. Those appealing, including Harry Watkins, Eleanor Shakar, and Janet Parsons brought themselves.

When asked what her standing was – that is, how she would be injured by the subdivision – Shakar said she had a dock on the waterway which should give her the “right to speak on what happens.”

Lee responded by stating that it would be “engaging in unauthorized practice of law” for someone to interpret legal documents if they were not a licensed attorney.

When Shakar brought up the issue of land ownership – i.e. that the lot may not be large enough to subdivide because the state owns waterways – the issue of her standing again blocked her objection.

Watkins, an architect who owned a neighboring property, was granted standing based on his proximity to the property. Watkins reiterated Shakar’s point, that the Head Road parcel could likely contain two 2-acre lots, but because part of it was under marsh and water, not three lots.

Lee objected to Watkins’ testimony, not on the ground of standing, but because Waktins was not “competent” to determine acreage since he was not a surveyor or providing a survey; he then extended that to a standing objection against any other appeals. Lee told the Planning Commission that he did not believe they would hear from an attorney, an engineer, or a title expert – essentially stating that nothing said by those who came to appeal could be considered.

In the end, the only person qualified – under the rules of the hearing – was Balland, the engineer Lee brought with him. The Planning Commission asked Balland to settle the question – what was the acreage of “dry land” on the property, not the total size.

Balland told the commission he didn’t know and would have to guess, reiterating against that the deed states that property is 7.49 acres. Since Lee had effectively barred the testimony of those appealing, on the ground that they either had no standing or no competence, Balland’s guess was all the Commission had.

It’s worth pointing out that several months earlier, in May, the city’s planning office had been emailed a survey of the area, conducted by an environmental consulting group; the survey showed that only 5.2 acres of the property were considered to be dry land. Staff did not volunteer this information during the hearing.

For his part, Lee said of the hearing, “It has been quite some time ago but I do not recall the text amendment creating the district being contentious,” adding that city staff did a good job explaining it.

Spirit vs. Law

The Planning Commission initially moved to deny Lee’s request. Commissioners Bruce McGuire and Bruce Bowman both argued the denial was based on the actual amount of dry land.

Commissioner Jeff Hovis said he agreed with that argument in spirit, but that the commission had to rely on the “testimony of experts.” Hovis said the Commission may not agree with the land use, but that they “couldn’t go back.” Likewise, Commissioner Kemp Roberts said that he agreed with the “spirit,” but that the Planning Commission had to stand behind what was “in the rules.”

Assistant City Attorney Amy Schaefer also weighed, echoing the idea that the Commissioners were charged with sticking to technical standards.

Still, the Commission was split over whether to vote on the spirit or the legality of Lee’s request. McGuire and Bowman voted against it, Chairwoman Deb Hays, Vice Chairman Richard Collier, Hovis, and Roberts voted for it.

Fighting City Hall

In October of 2016, Janet Parsons took her case to New Hanover County Superior Court. In May of 2017, Superior Court Judge Phyllis Gorham upheld the Planning Commission’s decision and denied Parson’s motions.

Parson appealed.

The major issues included whether or not the state-owned land should be included in the property size.

Parsons and her attorney, Steve Coggins, had since learned that on May 20, 2016, Wilmington-based environmental consultants Land Management Group had emailed a survey of the Head Road parcel, certified by the state, to Kathryn Thurston, the city’s zoning administrator.

In May, the city received a copy of a survey of 6329 Head Road, showing that about 2 acres was considered state-owned wetlands. (Port City Daily photo | City of Wilmington)
In May, the city received a copy of a survey of 6329 Head Road, showing that about 2 acres of the land were considered state-owned wetlands. (Port City Daily photo | City of Wilmington)

The public document, produced by licensed engineers and certified by the state, would almost certainly be admissible evidence in the case. Parsons made a motion to retroactively add it to the Planning Commission’s record, but – like her other motions – Judge Gorham would not allow it.

Eventually, after two years of fighting the issue, Parsons v. City of Wilmington settled.

Neither Coggins or the City of Wilmington provided comment on the terms of the settlement. However, one reason may have been the passage of Senate Bill 131; known as the Regulatory Reform Act of 2016-2017, when passed into law it included language that essentially allowed “expedited review” of subdivisions, requiring on the plat (the county record) for subdividing properties over 5 acres into no more than 3 lots. The law for all intents and purposes negated any argument based on North Carolina Division of Coastal Management’s assessment of submerged lands. (You can see the bill’s history and read it here.)

Asked if he had any roll in the bill, Lee said no, although he did vote for it. Lee said State Senator Andy Wells was responsible for the language related to subdivisions. Calls and emails to Wells were not returned by press time.

In the end, whatever concessions Parsons may or may not have won from the city, the moral of the story remains the same, since the courts essentially upheld the law over the spirit when it comes to appealing a case before the city. If nothing else, the case highlights the profound difficulty of making a case against skilled attorneys, with the resources of time, money, and expertise.

There is no apparent construction ongoing beyond the foundation that has been on the lower section of the property since before Fetzer sold it.
There is no apparent construction ongoing beyond the foundation that has been on the lower section of the property since before Fetzer sold it. (Port City Daily photo | File)

As for the Head Road property, the Webbs still own the land, which is now divided into three lots according to county property records. There is no apparent construction ongoing beyond the foundation that has been on the lower section of the property since before Fetzer sold it.

Fetzer, meanwhile, bought a $2 million house just around the corner.


Send comments and tips to Benjamin Schachtman at ben@localvoicemedia.com, @pcdben on Twitter, and (910) 538-2001.

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