Friday, January 17, 2020

A medium length primer on Bert J. Harris Act claims. What we can expect (including a timeline). Link to Bert J Harris Act provided.

Be thankful that Bert J Harris claims don’t arise every day. But this also means that the law is one that is still developing, so there is some uncertainty, so less predictability, as to how these serious claims for (alleged) deprivation of property rights may play out. 

I offer up some perspective to answer questions I have been asked on this matter. I am publishing this response here for public viewing as well as to assist our first time Palmetto Bay “Interim” Village Manager who has no experience in these types of matters as well as Palmetto Bay’s recently hired in-house Village Attorney (I am unaware as to his level of expertise on this specific litigation). I am trying to be helpful. The main point is Palmetto Bay needs to manage this litigation correctly as this could be the first of a few Bert J Harris claims, unfortunately, rather than a unique claim. Palmetto Bay must avoid setting bad law precedent for future litigation.

This article is in follow up to the Monday, January 13, 2020, blog post: involving Breaking News – 2:29 PM, Monday, January 13, 2020 - LUXCOM voluntarily dismisses the DOAH administrative action; gives notice of BERT J HARRIS claim potentially seeking over $21 million. Details including link to relevant documents.  As indicated, there are links provided to relevant documents that will allow those interested to do a deep dive into this matter.

Before a lawsuit is filed for a Harris Act claim, certain prerequisites are required under the statute. The Bert J Harris claim must be submitted not less than 150 days prior to filing a lawsuit under the act (Completed by LUXCOM on 1/13/2020). This claim must include a bona fide valid appraisal in support of the claim. (Completed by LUXCOM on 1/13/2020). Both the claim letter and appraisal were delivered to Palmetto Bay.

Palmetto Bay is now on the clock, and is required to either make a written settlement offer or state that Palmetto Bay will take no action within 150 days. (Deadline date:  Thursday, June 11, 2020)

If no settlement is reached during the 150-day notice period, Palmetto Bay must then issue a written statement of allowable uses identifying the allowable uses.

LUXCOM has to follow this procedure, or Palmetto Bay will be entitled to a dismissal of the Bert J. Harris Act claim.

Remedies – the $21,760,000.00 question.

Cash or rezoning – much is a matter of timing and how Palmetto Bay responds. 

LUXCOM appears to be alleging $21,760,000.00 in damages under Bert J Harris. The important allegation is contained in the Appraisal (Page two of appraisal, overall page eight of 63) that the Bert J Harris damages are projected at $21,760,000.00. The appraisers arrive at that number by setting their appraised value for the property as of July 29, 2019 at $34,000,000.00 based upon the value as an institutional use. The same appraisers then set a value for this same property predicated upon the re-zoning for the Estate Density Residential as of July 30, 2019: $12,240,000.00.  This results in the opinion of the appraisers for the "Bert J. Harris" claim as of July 30, 2019, or: $21,760,000.00.

Obviously Palmetto Bay will seek its own appraisal. However, it will be bound by the appraiser’s report.  Perhaps the appraiser will opine that there is no difference in value between the value of institutional use for example on July 29, 2019, as when the property was rezoned (as of July 30, 2019). Obviously, any different in value by Palmetto Bay appraisers (if requested) will set a minimum (floor) for potential damages, just as LUXCOM is bound by a maximum claim (ceiling or high water mark) of $21,760,000.00.

Another aspect of the act is encouragement for the parties to resolve claims by using alternative remedies (sounds a lot like the 12/12/2019 dispute resolution event, that did not go well for Palmetto Bay – see: January 7, 2020, South Dade Updates Guest Blog- view of the 12/12/2019Palmetto Bay / Miami-Dade County conflict resolution proceeding (let’s hope the Village has learned from this 12/12/2019 debacle and will be better prepared for this round involving a potential $21,700,000.00 plus Bert J. Harris claim – we are talking serious money here, not stop signs)

Palmetto Bay, if it acts timely, can avoid monetary damages, but, [and again, during a limited period (unless extended)] Palmetto Bay must make a written settlement offer that can include adjustment of land development; increase in density, intensity, or use; transfer of developmental rights (TDRs); land swaps or exchanges; mitigation, including payments in lieu of onsite mitigation; location on the least sensitive portion of the property; conditioning the amount of development or use permitted; etc. This takes a willingness to actually take a stand and make an offer. Obviously none of this would occur if Palmetto Bay officials opine that the Village (and its taxpayers) are at no risk from a Bert J Harris Act claim.

Big Issues with remedies

Once a lawsuit is filed, the court is limited to remedy monetary damages only. This may pit Palmetto Bay's appraisal (if one is obtained) v. LUXCOM’s appraisal of  $21,760,000.00.

Special circumstances may allow for the parties to revisit the monetary and work out a zoning option, but both sides need to be willing and sufficiently savvy to do so.

The “Toolbox” (resource materials):

The actual ACT online (CLICK HERE or title line below):

70.001   Private property rights protection.
70.002  Property Owner Bill of Rights.
70.20 Balancing of interests.
70.45 Governmental exactions.
70.51  Land use and environmental dispute resolution.
70.80 Construction of ss. 70.001, 70.45, and 70.51.
70.001 Private property rights protection.—
(1) This act may be cited as the “Bert J. Harris, Jr., Private Property Rights Protection Act.” The Legislature recognizes that some laws, regulations, and ordinances of the state and political entities in the state, as applied, may inordinately burden, restrict, or limit private property rights without amounting to a taking under the State Constitution or the United States Constitution. The Legislature determines that there is an important state interest in protecting the interests of private property owners from such inordinate burdens. Therefore, it is the intent of the Legislature that, as a separate and distinct cause of action from the law of takings, the Legislature herein provides for relief, or payment of compensation, when a new law, rule, regulation, or ordinance of the state or a political entity in the state, as applied, unfairly affects real property.
BLOG EDITOR'S DISCLAIMER: I will update with more information in additional future posts. This information is put out to provide some idea of the alleged basis for the LUXCOM claim under BERT J HARRIS ACT. How the claim actually proceeds, if at all is dependent in large part upon how the claim is pursued by LUXCOM as well as defended by the Village of Palmetto Bay.

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