Key Ads, Inc. v. Dayton Bd. of Zoning Appeals

2014 Ohio 4961
Ohio Court of Appeals·Decided November 7, 2014·No. 26148·Published·Cited by 11 cases

Opinion

[Cite as Key Ads, Inc. v. Dayton Bd. of Zoning Appeals, 2014-Ohio-4961.]

IN THE COURT OF APPEALS OF OHIO SECOND APPELLATE DISTRICT MONTGOMERY COUNTY

KEY ADS, INC.

Plaintiff-Appellee v. CITY OF DAYTON BOARD OF ZONING APPEALS Defendant-Appellant

Appellate Case No. 26148

Trial Court Case Nos. 2013-CV-2556 2013-CV-2559

2012-CV-2604

(Civil Appeal from (Common Pleas Court)

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OPINION

Rendered on the 7th day of November, 2014.

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JOHN C. CHAMBERS, Atty. Reg. No. 0029681, SASHA ALEXA M. VANDEGRIFT, Atty. Reg. No. 0080800, 33 West First Street, Suite 600, Dayton, Ohio 45402 Attorneys for Plaintiff-Appellee

JOHN J. DANISH, Atty. Reg. No. 0046639, City of Dayton Attorney, JOHN C. MUSTO, Atty. Reg. No. 0071512, Assistant City of Dayton Attorney, 101 West Third Street, P.O. Box 22, Dayton, Ohio 45401 Attorneys for Defendant-Appellant

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WELBAUM, J.

{¶ 1} Defendant-appellant, the City of Dayton Board of Zoning Appeals (“Board”),

appeals from a judgment of the Montgomery County Court of Common Pleas reversing a decision of the Board that rejected plaintiff-appellee Key Ads, Inc.’s (“Key Ads”), applications to alter three signs by changing the face of each sign from static vinyl to electronic changeable copy panels. For the reasons outlined below, we find the common pleas court erred in reversing the Board’s decision. The judgment of the common pleas court will therefore be reversed.

Facts and Course of Proceedings

{¶ 2} In early 2011, Key Ads filed zoning applications with the City of Dayton (“City”), requesting to alter three signs by changing the face of each sign from static vinyl panels to electronic changeable copy panels, i.e., digital panels. The three signs at issue are owned by Key Ads and are located in the City at 113 East Stewart Street, 629 South Main Street, and 3521 Riverside Drive, respectively. The Stewart Street and Main Street signs are located in the Mature General Commercial District (“MGC”), whereas the Riverside Drive sign is located in the Eclectic Single-Family Residential District (“ESF”). The signs are all static vinyl, non-digital billboards, meaning that in order to change the message on the signs, Key Ads must remove the vinyl that covers the panel of the sign and have new vinyl put in its place.

{¶ 3} All three signs at issue were built before 2006. The City adopted zoning

restrictions in 2006 that rendered the signs noncompliant with the City of Dayton Zoning Code (“Zoning Code”). However, since the signs were built before the 2006 restrictions were enacted, the signs were grandfathered in and are allowed to remain as non-conforming uses. There is no dispute that all three signs are “non-conforming off-premise signs” under the Zoning Code.1

{¶ 4} On April 15, 2011, the City’s Zoning Administrator, David Wombold, rejected Key Ads’ applications to convert the three non-conforming off-premise signs from vinyl panels to electronic changeable copy panels. In rejecting the applications, Wombold determined that the requested alteration was not in compliance with the Zoning Code.

Among the deficiencies was that the Zoning Code prohibits non-conforming signs from being renovated if the cost exceeds 50 percent of the value of the sign. Following the rejection, on May 12, 2011, Key Ads appealed to the Board, and filed a written request for a hearing and a memorandum in support of the application. The hearing took place on February 26, 2013.

{¶ 5} At the hearing, the Board heard testimony from Nicholas Keyes, the vice president and part owner of Key Ads. Keyes testified that one of Key Ads’ competitors had previously been granted permits to have electronic changeable copy signs in the same districts that Key Ads’ three signs are located. Additionally, he testified that the signs’ estimated

1

The Zoning Code defines “non-conforming sign” as “[a] sign, lawfully existing at the time this Zoning Code, or any amendment thereto, became or becomes effective, but which fails to conform to the sign regulations of the district in which it is located[.]” City of Dayton Zoning Code 150.140.6(B). An “off-premise sign” is defined as “any sign structure displaying an establishment, merchandise, event, service, or entertainment that is not sold, produced, manufactured or furnished at the property on which the sign is located.” Id. at 150.900.2(B). In addition, a “non-conforming off-premise sign” is “any off-premise sign not installed, constructed altered, repaired, replaced, located or relocated in accordance with 150.925.4[.]” Id. at 150.925.5. Section (A) of 150.925.4 provides the zoning districts in which “a person may install, construct, alter, repair, replace, locate or relocate an off-premise sign[.]” The MGC and ESF districts are not among the districts in which off-premise signs are permitted. See Id. at 150.925.4(A).

selling price after the conversion from vinyl to electronic changeable copy panels would be $1.1 million for the Riverside Drive sign, $2.25 million for the Main Street sign, and $2.5 million for the Stewart Street sign. According to Keyes, the cost to convert the sign panels from vinyl to electronic changeable copy would not exceed 50 percent of the signs’ value.

{¶ 6} In addition to Keyes’ testimony, Alan Duvall, a local certified public accountant, certified business appraiser, and attorney, testified as an expert witness at the hearing. According to Duvall, the cost to convert each sign from vinyl to electronic changeable copy panels would be $200,000 per sign. With regards to the value of the signs, Duvall opined that the fair market value of the sign must be used, not the real estate’s value, nor the cost to rebuild the signs. Duvall testified that he used the highest and best use standard in evaluating the signs’ fair market value. In other words, Duvall calculated the fair market value by estimating the value of the signs after their conversion from vinyl to electronic changeable copy, because, according to Duvall, that would be the highest and best use of the signs. Applying that standard, Duvall testified that the value of the Riverside Drive sign would be worth over $1 million, the Stewart Street sign would be worth approximately $2 million, and the Main Street sign would be worth over $2 million. He arrived at these valuations by considering the current revenue being generated by the vinyl signs and then multiplying it by ten, as he believed the change from vinyl to electronic changeable copy would increase the value tenfold.

{¶ 7} David Wombold, the City’s Zoning Administrator, also testified at the hearing. Wombold testified that in his experience, he has never seen a vinyl sign exceed $100,000 in value, and that he estimates the highest value of a vinyl sign in the City to be $60,000. Wombold also noted that the electronic changeable copy signs that were permitted for Key Ads’ competitor were approved before he was the Zoning Administrator, and that had he been the Zoning Administrator at the time Key Ads’ competitor applied, he would have denied their application as well.

{¶ 8} After the hearing, the Board deliberated and decided to affirm the Zoning Administrator’s rejection of Key Ads’ applications. Key Ads then appealed from the Board’s decision to the Montgomery County Court of Common Pleas. The common pleas court reversed the Board’s decision finding that section 150.900.18(B)(2)(b) of the Zoning Code permits the alteration of the signs’ panels from vinyl to electronic changeable copy. The court also found that the alteration complies with section 150.900.18(B)(3), because the cost to alter the signs would not exceed 50 percent of the signs’ value. In addition, the common pleas court found that section 150.925.14 of the Zoning Code expressly permits commercial electronic variable message signs and that replacing the signs’ panels is a form of refurbishment permitted under section 150.900.15(D)(3).

{¶ 9} The Board now appeals from the judgment of the common pleas court, raising one assignment of error for review.

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