FM Properties Operating Co. v. City of Austin

93 F.3d 167, 1996 WL 460007
CourtCourt of Appeals for the Fifth Circuit
DecidedAugust 15, 1996
Docket95-50426
StatusPublished
Cited by95 cases

This text of 93 F.3d 167 (FM Properties Operating Co. v. City of Austin) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
FM Properties Operating Co. v. City of Austin, 93 F.3d 167, 1996 WL 460007 (5th Cir. 1996).

Opinion

DUHÉ, Circuit Judge:

FM Properties Operating Company (“FMP”) sued the City of Austin, Texas, under 42 U.S.C. § 1983, claiming the City arbitrarily and capriciously rejected its application for a land development permit, thereby violating its Fourteenth Amendment substantive due process rights. The district court entered judgment on a jury verdict in favor of FMP, and the City appealed. Because we find that FMP has failed to state a constitutional claim, we reverse the judgment and remand to the district court to dismiss.

I.

A House Bill h

In 1987, the Texas Legislature enacted the Texas Department of Commerce Act, Acts 1987, 70th Leg., eh. 374, § 1 (eff. Sept. 1, 1987) (current version at Tex.Gov’t Code Ann. § 481.101 et seq. (West 1990 & Supp. 1996)). At all times pertinent to this litigation, § 481.143(a) (“House Bill 4”) provided:

The approval, disapproval, or conditional approval of an application for a permit shall be considered by each regulatory agency solely on the basis of any orders, regulations, ordinances, or other duly adopted requirements in effect at the time the original application for the permit is filed. If a series of permits is required for a project, the orders, regulations, ordinances, or other requirements in effect at the time the original application for the first permit in that series is filed shall be the sole basis for consideration of all subsequent permits required for the completion of the project.

Tex.Gov’t Code Ann. § 481.143(a) (West 1990) (emphasis added) (amended 1995). 1 On September 1, 1987, the effective date of House Bill 4, the Austin City Manager delivered to the City Council a proposed interpretation of House Bill 4 that advocated treating the land development process as involving, in House Bill 4 rubric, two separate “projects.” The City Council unanimously adopted this construction, and since 1987 has divided land development activities into two projects, each involving a “separate and independent series” of permits — i.e., that series of permits necessary for subdividing unplatted, raw land into legal lots and that series of permits necessary for vertical construction on existing legal lots.

In the subdivision project, the application for preliminary subdivision plat approval is the first in the series of necessary permits. Under the City Council’s House Bill 4 policy, the filing of this initial application freezes those ordinances and regulations in effect on that date, such that the City Council’s consideration of the remaining permits required to obtain final subdivision plat approval is controlled by those regulations and ordinances, regardless of any subsequent enactments, amendments, or repeals. Likewise, a site plan application is the first permit application in the series of permits required for approval of construction on subdivided property. The *170 filing of the site plan application freezes those ordinances and regulations in effect on its filing date to govern the remainder of this permit process.

In August 1991, the City Attorney submitted a legal opinion to the City Council stating that its House Bill 4 policy was valid under Texas law. In the opinion letter, the City Attorney explained the purpose of the two-project policy:

It is well known that property is often subdivided for speculative reasons with no plans beyond enhancing the property’s value and making it marketable. The City has no way to determine what a person envisions as the ultimate result when particular applications are filed. Therefore, short of making a factual determination as to what each person’s “project” is when each application is filed, the only way to resolve this issue is to make a reasonable determination as to what ordinarily constitutes a “project.” The City has done this by using the Series 1 and Series 2 divisions, which is a reasonable, objective, and factually based treatment of development applications.
If any action, including zoning ..., were to freeze development regulations, the result would be to eliminate recent subdivision and site development regulations (including watershed regulations) for much of the property within the city and the extraterritorial jurisdiction. Virtually all of the property within the city limits has been zoned, and much of the property within the extraterritorial jurisdiction has been, or is in the process of, being subdivided; this would mean that these properties would be subject to regulations which may already be outdated. Furthermore, the interpretation favored by those who disagree with the City’s policy would essentially prohibit any changes to subdivision and site development regulations. This would permit persons to develop property under outdated and substandard regulations.
For example, a developer would not have to build in accordance with the latest building, fire, plumbing, mechanical, or electrical codes, but would be permitted to build under codes that might be years old. In addition, the developer would not be required to comply with drainage and watershed regulations. This would result in shoddy development and create an obvious public safety problem which could expose the developer, and possibly the City, to liability for personal injury. This result is contrary to the public interest in health, safety, and welfare.

B. Factual history

In 1987, FMP’s predecessor in interest purchased 4,000 acres in the Barton Creek Watershed outside of Austin. When purchased its development was governed by the City’s 1986 Comprehensive Watershed Ordinance. 2 Early in 1991, the 1986 ordinance was replaced with an interim watershed ordinance effective for six months. When the interim ordinance expired, the City Council passed a two month moratorium on development. The City Council then replaced the moratorium with the 1991 Composite Watershed Ordinance.

Thereafter, on April 8, 1992, FMP’s predecessor in interest submitted thirteen applications for preliminary subdivision plat approval to the City. 3 Two months later, FMP’s predecessor in interest transferred the 4,000 acres to FMP. Between December 1992 and April 1993, the City approved all thirteen preliminary subdivision plans.

On July 28, 1992, FMP filed a site plan application proposing development of a 198-unit multifamily complex called “The Falls.” *171 Under the City’s Land Development Code, the site plan application would expire on July 26,1993, if all steps for its approval were not completed by then. The City alerted FMP that the site plan application could not be approved until a final subdivision plat was approved and extended FMP’s site plan application approval deadline to August 23, 1993. FMP then filed a final subdivision plat application and amended its site plan application to reduce the size of the development to 41 units. Final subdivision plat approval was received on August 24, 1993, the day after FMP’s site plan application expired.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Jackson v. Tarrant County
Fifth Circuit, 2025
Divine v. Securix, LLC
S.D. Mississippi, 2024
Hignell v. City of New Orleans
E.D. Louisiana, 2024
Smith v. City of Bastrop
Fifth Circuit, 2023
Newell-Davis v. Phillips
E.D. Louisiana, 2022
Martin Wheelan v. City of Gautier and David A. Vindich
Court of Appeals of Mississippi, 2021
Mirna Reyes v. North Texas Tollway Authorit
861 F.3d 558 (Fifth Circuit, 2017)
Hackbelt 27 Partners, L.P. v. City of Coppell
661 F. App'x 843 (Fifth Circuit, 2016)
Reyes v. North Texas Tollway Authority
186 F. Supp. 3d 621 (N.D. Texas, 2016)

Cite This Page — Counsel Stack

Bluebook (online)
93 F.3d 167, 1996 WL 460007, Counsel Stack Legal Research, https://law.counselstack.com/opinion/fm-properties-operating-co-v-city-of-austin-ca5-1996.